Reassessment Notice Issued Under Section 148 for AY 2015-16 Beyond Ten Years Is Time-Barred and Quashed

By | October 29, 2026
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Reassessment Notice Issued Under Section 148 for AY 2015-16 Beyond Ten Years Is Time-Barred and Quashed

Issue

Whether a reassessment notice dated March 31, 2026, issued under Section 148 for Assessment Year 2015-16, was issued beyond the maximum permissible ten-year time limit prescribed under Section 149 and thus liable to be quashed.

Facts

  • Assessment Year: The matter pertains to Assessment Year 2015-16 (relevant to Financial Year 2014-15).
  • Notice Issuance: The Revenue issued a reassessment notice under Section 148 of the Income-tax Act on March 31, 2026.
  • Limitation Period: Under Section 149 of the Act, the maximum permissible extended limitation period for issuing a Section 148 notice is ten years from the end of the relevant assessment year.
  • Calculation: The ten-year limitation period for A.Y. 2015-16 expired on March 31, 2026, making the notice issued on or after that threshold time-barred under the statutory framework.

Decision

  • Barred by Limitation (In Favour of Assessee): The reassessment notice dated March 31, 2026, for A.Y. 2015-16 was issued beyond the strict permissible ten-year time frame laid down under Section 149.
  • Quashing of Notice (In Favour of Assessee): Since the notice failed to comply with the statutory period of limitation, the Section 148 notice was bad in law and liable to be quashed [In favour of assessee].

Key Takeaways

  • Strict Statutory Time Limits: Section 149 sets an absolute outer limit of ten years for reopening assessments involving income escaping assessment; notices issued beyond this period lack jurisdiction.
  • Jurisdictional Defect: An assessment reopened via a time-barred notice under Section 148 is void ab initio and cannot be sustained in law.
HIGH COURT OF DELHI
Rita Kumari
v.
Assistant Commission of Income-tax
Dinesh Mehta and Dr. Aditi Choudhary, JJ.
W.P.(C) 9112 OF 2026
CM APPL. 42747 and 42748 OF 2026
OCTOBER  7, 2026
Sachit Jolly, Sr. Adv., Ms. Bina Gupta, Ms. Anushka Rawal, Abhyudaya Shankar Bajpai and Ms. Ishkia, Advs. for the Petitioner. Gaurav Gupta, SSC, Shivendra Singh, JSC, Yojit Pareek and Shamindra Kumar Dev, Advs. for the Respondent.
JUDGMENT
Dinesh Mehta, J. – By way of present writ petition preferred under Article 226 of the Constitution of India, the petitioner has challenged the notice dated 31.03.2026 issued under Section 148 of the Income-Tax Act, 1961 (hereinafter referred to as ‘Act of 1961’) seeking to reassess the income of the petitioner for assessment year 2015-16.
2. Learned Senior Counsel for the petitioner at the outset argued that the impugned notice has been issued beyond the time period prescribed under Section 149 of the Act of 1961.
3. He submitted that the reassessment proceedings arise from the search and seizure action conducted under Section 132 of the Act of 1961 on 02.03.2022 at the premises of Gaursons Group and its associates. Since the impugned notice has been issued on 31.03.2026, the relevant assessment year, for the purposes of computing the outer ten-year period, would be AY 2026-27.
4. Mr. Gaurav Gupta, learned Senior Standing Counsel appearing for the Department was not in a position to controvert to the factual matrix of the case.
5. Heard learned counsel for the parties.
6. It does not need much discussion that the impugned notice, dated 31.03.2026, falls in the financial year 2025-26 corresponding to assessment year 2026-27. The ten-year period would, therefore, extend only up to assessment year 2017-18. The impugned notice qua assessment year 201516 is clearly beyond the permissible limitation period, the escaped income being more than Rs.50,00,000/-. If calculated backward from assessment year 2026-27, the position is as under:
For ease of understanding, a tabular depiction is made hereunder:
Year No. (counted backwards) Assessment Year
1 AY 2026-27
2 AY 2025-26
3 AY 2024-25
4 AY 2023-24
5 AY 2022-23
6 AY 2021-22
7 AY 2020-21
8 AY 2019-20
9 AY 2018-19
10th year AY 2017-18

 

7. The impugned notice for AY 2015-16 is, thus, time-barred on a plain reading of Section 149 of the Act of 1961.
8. The writ petition is allowed, the notice dated 31.03.2026 is quashed. Pending applications stand disposed of.