The Assessing Officer issued a notice under section 148A(b) of the Income Tax Act, 1961 on 15 March 2022 for the assessment year 2015-16, alleging escapement of income amounting to ₹78,59,057. The petitioner sought additional time to respond, but the request was denied, and an order under section 148A(d) was passed on 31 March 2022, leading to the issuance of a reassessment notice under section 148. The petitioner argued that the notice was barred by limitation under section 149(1)(a), as the escaped income was less than ₹50 lakh and the due date to issue notice in his case would be 3 years from the relevant assessment year ie. 31 March 2019. However, the Revenue claimed that the extended period of limitation under section 149(1)(b) applied since the escaped income exceeded ₹50 lakh.

The Hon’ble Gauhati High Court held that the petitioner was not given a reasonable opportunity to respond, which violated section 148A(c) and the principles of natural justice. The Court noted that the notice was received only six days before the deadline, which was inadequate. Further, the Court held that the denial of additional time was unjustified, and even if the escaped income exceeded ₹50 lakh, the due date would be 31 March 2026 and not 31 March 2022, and hence the reason so assigned in the affidavit for not granting additional opportunity amounted to non-application of mind. Consequently, the reassessment order and notice were quashed, and the Assessing Officer was directed to consider the petitioner’s reply and provide a fresh hearing.(AY. 2015-16)