ITAT Bangalore Quashes Reassessment Notice Over Limitation Period

The Story in Brief

A retired Mysuru teacher deposited Rs 1.33 crore in cash during assessment year 2015-16 and had not filed an income tax return. The Income Tax Department issued notices and later assessed his income at Rs 48.85 lakh. His appeal before the Commissioner of Income Tax (Appeals) was dismissed.

The ITAT Bangalore SMC Bench allowed his appeal, ruling that the Section 148 reassessment notice issued on April 26, 2022, was 26 days beyond the applicable limitation period ending March 31, 2022. It held the notice and subsequent reassessment invalid, without deciding the underlying cash deposit issue.

The Indian Opinion

The ruling highlights that tax authorities must follow statutory time limits, even when transactions appear unusual or raise legitimate questions. It does not establish that the cash deposits were fully explained or that no tax was due. Claims portraying the decision as a complete clean chit may therefore be overstated. The source also provides limited detail on the teacher’s evidence and the legal reasoning beyond limitation.

Source: economictimes.indiatimes.com

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