India: Procedural disputes within revived reassessment proceedings (Supreme Court decision)
Supreme Court resolves certain procedural disputes raised in revived reassessment proceedings.
The Supreme Court held that the Taxation and Other Laws (Relaxation of Certain Provisions) Act, 2020 (TOLA) applies to any action for which the statute of limitations would expire between March 20, 2020, and March 31, 2021, even if it is under a provision introduced after April 1, 2021, under the Finance Act, 2021.
The case is: UOI & Others v. Rajeev Bansal
Background
After introduction of the new reassessment regime under the Finance Act, 2021, tax officers continued to issue reassessment notices following the old reassessment procedures during April 1, 2021, to June 30, 2021, on the ground that the TOLA had extended compliance timelines. The Supreme Court previously held in UOI & Others v. Ashish Agarwal that notices issued on or after April 1, 2021, must be issued under the new reassessment regime. However, the Supreme Court exercised its jurisdiction under Article 142 of the Constitution of India and revived the disputed reassessment notices by deeming those notices as under the new reassessment regime.
Taxpayers disputed various procedural aspects of those revived reassessment proceedings, such as time limitations and issuance of notice without sanction from the appropriate authority under the new assessment regime, which the Supreme Court resolved in this recent decision.
Read an October 2024 report prepared by the KPMG member firm in India