Delhi HC weighs revival of tax notices dating back to '96

Retrospective reopening may shake the credibility of voluntary disclosure schemes

- Krishna Yadav

The Delhi High Court will soon decide whether the tax department can retrospectively reopen old tax notices involving foreign assets—even if those notices were time-barred under earlier rules.

A division bench led by Justices Vibhu Bakhru and Tejas Karia was hearing a batch of petitions on 30 May—filed by companies such as UK Paints (Overseas) Ltd, BJN Holdings (India) Ltd, and KS Dhingra—challenging these reassessment notices under Section 148 of the Income Tax Act.

It referred the matter to a larger bench for a final decision.

The notices were issued between 2014 and 2021, covering assessment years that stretch back decades.

At the centre of the case is a 2012 amendment to the Income Tax Act that extended the reassessment period from six years to 16 years for cases involving foreign assets.

After the amendment, which was aimed at tackling black money and undisclosed foreign assets, the department started issuing reassessment notices for older cases, some dating back to 1997.