Delhi High Court invalidates reassessment notice for AY 2014-15 issued beyond six-year limitation

Background of the dispute

In Mohd. Athar Anjum Vs ACIT (Delhi High Court), the Delhi High Court examined the validity of a reassessment notice dated 31.03.2024 issued under Section 148 of the Income Tax Act 1961 for Assessment Year 2014-15.

The assessee approached the Court by way of W.P.(C) 3472/2025, challenging:

  • The notice issued under Section 148A(b)
  • The order passed under Section 148A(d)
  • The consequential reassessment notice under Section 148 dated 31.03.2024

The central question was whether, in light of the amended reassessment scheme and the transitional provisions under Section 149(1)(b) and its first proviso, the Revenue could initiate reassessment for AY 2014-15 on 31.03.2024, even though the earlier six-year limitation period had already come to an end.

The dispute turned on the interaction between:

  • The old reassessment regime, under which reassessment could generally be initiated up to six years from the end of the relevant assessment year (Section 149(1)(b) – old law), and
  • The new reassessment framework, introduced by the Finance Act, 2021, which extended the time limit up to ten years in specified cases, accompanied by a first proviso to Section 149(1)(b) restricting retrospective operation.

The assessee argued that once the six-year period under the old regime had expired, the new extended ten-year period could not be used to reopen an already time-barred assessment year, relying on binding precedent.

Reliance on Delhi High Court and Supreme Court precedents

Reference to Manju Somani decision

Counsel for the assessee submitted that the controversy was squarely covered by the Delhi High Court’s earlier judgment in:

  • Manju Somani v. Income Tax Officer Ward-70(1) & Ors., Neutral Citation: 2024:DHC:5411-DB

This decision had already examined the reach of the first proviso to Section 149(1)(b) and held that assessment years that had become barred by the six-year limitation under the old law could not be revived under the new ten-year window.

Supreme Court ruling in Union of India & Others v. Rajeev Bansal

Further, the assessee drew support from the Supreme Court judgment in:

  • Union of India & Others v. Rajeev Bansal, 2024 SCC OnLine SC 2693

Specific reliance was placed on paragraphs 46 and 49 of the Supreme Court’s decision, which interpret the first proviso to Section 149(1)(b) in detail. The Delhi High Court reproduced and considered the following key portions: