Indian Courts Clarify Income‑Tax Reassessment Procedures

income tax reassessment section 148 high court ruling exemption valuation live link requirement

The Allahabad High Court ruled that an income‑tax reassessment notice issued in the name of a deceased person is void from the outset and cannot be validated later by substituting the legal heir. The bench directed that the judgment be forwarded to the Union finance ministry for possible legislative amendment.

The Delhi Income Tax Appellate Tribunal (ITAT) set aside an assessing officer’s arbitrary determination of fair‑market value for land dated 01‑04‑2001, upholding the assessee’s claim for exemption under sections 54 and 54F of the Income Tax Act.

A separate New Delhi ITAT bench held that reopening a tax assessment under section 148 requires a “live link” between specific material and the reason to believe income escaped assessment. The lack of such a link rendered the reassessment invalid.

Sources

IT reassessment notice issued in deceased's name void ab initio: HC [www.news18.com]

4 days ago

ITAT Delhi Allows Sections 54/54F Exemption, Rejects Arbitrary FMV Determination as on 01. 04. 2001 [taxguru.in]

4 days ago

ITAT Quashes Reassessment for Absence of ‘Live Link’ Between Material and Escaped Income [www.taxscan.in]

4 days ago