Action of Reassessment in relation to Search undertaken on or after 1st April 2021 should meet Tests under First Proviso to Section 149(1) of Income Tax Act: Delhi HC [Read Order]

The Delhi High Court ruled that reassessment actions related to searches conducted on or after April 1, 2021, must adhere to the First Proviso to Section 149(1) of the Income Tax Act, 1961. \r

The petition challenged reassessment under Section 148 for Assessment Year 2013-14, initiated after a search at M/s Proform Interiors Private Limited. The counsel referenced Filatex India Ltd. vs. Deputy Commissioner of Income Tax & Anr, arguing for similar treatment. The respondents' counsel claimed that post-April 1, 2021, Section 148 governs reassessment. \r

The Division Bench noted that under the First Proviso to Section 149(1), reassessment should comply with pre-April 1, 2021, timelines. Consequently, the petitioner would succeed based on Section 153C's timeframe for AY 2013-14 reassessment.