Telangana HC sets aside Reassessment Notice Issued u/s 148 of Income Tax Act without following modified Procedure under Finance Act, 2021

The Telangana High Court invalidated a reassessment notice issued under Section 148 of the Income Tax Act, 1961, citing non-adherence to the revised procedures introduced by the Finance Act, 2021. The court emphasized that notices issued under Sections 147 and 148 after April 1, 2021, should follow the amended provisions under Section 148A. Failure to comply rendered the proceedings illegal, following precedents including directives from the Supreme Court in the Ashish Agarwal case. Justices Sujoy Paul and Namavarapu Rajeshwar Rao ruled that both the show cause notices and subsequent orders lacked legal validity due to procedural irregularities. The decision in W.P. No. 25903 of 2022 and related cases on September 14, 2023, concluded the matter, underscoring the mandatory nature of the amended procedures for reassessment notices. The case highlights the importance of procedural compliance in tax reassessment processes under evolving legislative frameworks.