Delhi HC quashes
re-assessment initiation for AY 1998-99 on assessee-individual (who was
non-resident for subject AY), as it was barred by limitation u/s. 149; Relying
on assessee’s statement during search that he had settled an offshore trust, AO
had issued notice u/s 148 in March, 2015 thereby proposing to tax the
amount of US $ 2-3 million contributed by assessee for settling a trust in
foreign country; Notes that assessment for subject AY could not be
reopened beyond March 31, 2005 in terms of provisions of Sec 149 as applicable
at the relevant time; Clarifies that the subsequent amendment by Finance Act,
2012, which extended the limitation to sixteen years, could not be resorted for
reopening concluded proceedings (in respect of which limitation had already
expired/ lapsed before the date the amendment became effective), further holds
the amendment to be prospective in nature; With respect to
Revenue’s contention that amendment in Sec. 149 is retrospective as its
procedural in nature, HC remarks that “the interpretation proposed by the
revenue has the potential of arming its authorities to re-open settled matters,
in respect of issues where the citizen could genuinely be sanguine and had no obligation
of the kind which the Revenue seeks to impose by the present
amendment.”, cites SC rulings in K.M. Sharma and S.S. Gadgil:HC
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