Reassessment – Notice issued after 01.04.2021 – AY 2015-16 – Time-barred – Addition relating to property purchase made in wrong assessment year – Not Sustainable

Sections 147 and 148 of the Income-tax Act, 1961

Issue

Whether reassessment proceedings for A.Y. 2015-16 initiated through a notice under section 148 issued after 01.04.2021 are valid, and whether an addition relating to investment in immovable property can be made in A.Y. 2015-16 when the payments for the property were made in an earlier financial year.

Held

The assessee had jointly purchased an immovable property for ₹66,41,850/- along with his mother. The Assessing Officer initiated reassessment proceedings for A.Y. 2015-16 by issuing a notice under section 148 dated 12.04.2022 based on information that the assessee had purchased an immovable property. During the assessment proceedings, the assessee furnished the registered deed and payment details showing that the payments for the property were made in F.Y. 2013-14 relevant to A.Y. 2014-15, including a housing loan of ₹53,00,000 obtained from Bank of Baroda.

The Tribunal observed that the notice issued under section 148 on 12.04.2022 for A.Y. 2015-16 was time-barred, as the Hon’ble Supreme Court in Deepak Steel & Power Ltd. v. CBDT had clarified that all notices issued for A.Y. 2015-16 on or after 01.04.2021 were liable to be dropped. Accordingly, the notice issued under section 148 and the consequent reassessment order were held to be invalid and were quashed.

The Tribunal further observed that even on merits the addition could not be sustained, since the payments for the property had been made in F.Y. 2013-14 (A.Y. 2014-15), whereas the addition was made in A.Y. 2015-16 merely because the property was registered in that year. The Assessing Officer had issued the notice without verifying the basic facts and without proper application of mind.

Accordingly, the reassessment proceedings were quashed and the addition made by the Assessing Officer was directed to be deleted.

Ratio / Principle

A reassessment notice issued under section 148 for A.Y. 2015-16 after 01.04.2021 is time-barred and liable to be quashed. Further, an addition relating to investment in immovable property cannot be sustained in an assessment year different from the year in which the actual payments were made.

Rahul Purswani v. ITO
ITAT Pune Bench
ITA No. 2106/PUN/2025 (A.Y. 2015-16)
Order dated: 09.04.2026