The case involved the validity of a notice issued under section 148 of the Income-tax Act, 1961, for reopening the assessment of the assessee for a given assessment year, on the ground of income escaping assessment. The revenue alleged that the assessee had received accommodation entries from two parties, which were not disclosed in the return of income. The assessee challenged the notice on various grounds, including that it was barred by limitation, vague, unspecific, and without proper approval.

The Hon’ble High Court  rejected the assessee’s contentions and upheld the notice. The court held that the notice was issued within the period of three years from the end of the relevant assessment year, after excluding the time given to the assessee to respond to a prior notice under section 148A(b) of the Act, and extending the period by seven days, as per the fifth and sixth proviso to section 149(1) of the Act. The court also held that the notice was not vague or cryptic, as it set out the transactions alleged to have escaped assessment, and that the approval for issuing the notice was not required to be provided along with the notice but could be obtained by the assessee on request. (AY 2019-20)