Delhi High Court overturns reassessment notices issued under old regime after April 1, 2021, CFO News, ETCFO

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The Delhi High Court’s division chamber, made up of Justices Manmohan and Navin Chawla, on Wednesday overturned all reassessment notices issued by taxpayers under the old regime as of April 1, 2021, leaving a huge respite to taxpayers.

The Delhi High Court has heard over 1,300 appraisals filed by appraisals challenging the validity of reassessment notices issued under the old reassessment regime after April 1, 2021.

Taxpayers had issued reassessment notices under the old regime in the light of extension notifications following the pandemic by the Central Council of Direct Taxes under the 2020 law (relaxation and modification of certain provisions) ( TOLA).

Under the old tax regime that existed until March 31, 2021, adjustment notices could be issued up to 4 years, 6 years or 16 years, depending on the different scenarios. Under the new tax regime, taxpayers can send adjustment notices for up to 3 years, or only 10 years. In addition, in the new tax system, taxpayers are required to give taxpayers the opportunity to hear from taxpayers before issuing adjustment notices, which they were not previously.

The Delhi High Court’s order is in line with the views of the High Courts of Allahabad and Rajasthan, which have also taken the same position and ruled in favor of the taxpayers. The Chhattisgarh High Court, meanwhile, took a different view in favor of taxpayers.

The reassessment procedures under the Income Tax Act allow taxpayers to reassess income that has escaped assessment. Notices of reassessment are sent under section 148 of the Income Tax Act.


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