The Tax fraternity has witnessed a range of developments since the amendment of reassessment provisions by the Finance Act 2021 and the resultant controversy surrounding reassessment notices issued on or after Apr 1, 2021 under the old regime. The Supreme Court's judgment in Ashish Agarwal does not seem to put the lid on the controversy, once and for all.
Mr. Ashish Sodhani (Leader, International Tax Advisory & Litigation, Nishith Desai Associates) articulates the developments on the reassessment controversy covering the Finance Act amendments, extension of time limits under The Taxation and other Laws (Relaxation of Certain Provisions) Act, 2020 right upto the SC ruling. He discusses various nuances of the SC ruling on directions given for conducting reassessment and questions the dispensing of the requirement of obtaining sanction under Section 148A(a). He expresses concern about the cases where the time limit of 30 days as laid down by the Supreme Court for furnishing information is not adhered to by the Revenue.
In the light of Instruction issued by the CBDT, Mr. Sodhani is of the view that the clarification on applicability of amended provisions of Section 149 would be useful for determining the validity of notices. He emphasizes that since both the Assessees and Revenue gave their broad consensus before the Supreme Court, a review petition may not possibly succeed. He maintains that one would have to be observant as to how the issue pans out in the due course of time and is hopeful that the Instruction would result in smoothening of the process.
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