The officer excluded the whole period he spent chasing a foreign tax authority. Does the exclusion start before the s.10(1) notice was served?
No. The time excluded under Explanation 1(iii) to s.11 of the Black Money Act cannot include a period before the s.10(1) notice was served, because exclusion presupposes that the period was inside the limitation to begin with. On the facts the excludable period ran from service of the notice on 25 November 2020 to receipt of the last reply on 25 May 2021, being 182 days and not 195, which moved the last date for the assessment to 29 September 2023. The order passed on 30 September 2023 was one day late and was quashed.
Decided by the ITAT (Shri Amit Shukla, Judicial Member and Shri Arun Khodpia, Accountant Member) on 2026-03-25, reported as BMA Nos. 27 and 29/Mum/2025, assessment year 2021-22. It bears on section BMA s.11, section BMA s.10(1), section BMA s.10(3) of the Income Tax Act 1961, in Assessment & Scrutiny and Appeals matters.
Limitation under the Black Money Act is worked almost entirely through the exclusions in Explanation 1 to s.11, and the department routinely counts from the date it wrote to the foreign authority. This fixes the starting point at service of the s.10(1) notice and shows that a single day is enough.
Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere.
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Notice under s.10(1) of the Black Money Act dated 24 November 2020 was issued and served on the assessee on 25 November 2020 (para 7). The first reference to a foreign tax authority, to France, had been made on 11 November 2020, that is before service of the notice, and the last reply, from the United Arab Emirates, was received on 25 May 2021. The Assessing Officer computed the excludable period at 195 days by counting from the date of the first reference and passed the assessment order for assessment year 2021-22 on 30 September 2023. The assessee appealed on limitation and the Revenue filed a cross appeal.
The assessee's appeal was allowed and the Department's appeal dismissed (para 30). The Tribunal held that the correct period liable to exclusion ran from 25 November 2020 to 25 May 2021, which works out to 182 days (para 23), and that adding 182 days to the normal limitation date of 31 March 2023 gave 29 September 2023 as the last date for passing the assessment order (para 23). The assessment order dated 30 September 2023 was accordingly held to be time barred, without jurisdiction and non est in law, and was quashed.
The Tribunal treated the power to assess under the Black Money Act as a jurisdictional process set in motion in the manner the statute prescribes, and service of the notice under s.10(1) as the point at which the assessee is brought within the proceedings. On that footing the exclusion in Explanation 1(iii) can only operate on time that was already running: exclusion presupposes inclusion within the original field of computation, and a period that never entered the available time cannot be taken out of it. A reference made to a foreign authority before the notice was served therefore could not be counted (paras 16, 17 and 21), leaving 182 excludable days and a last date of 29 September 2023.
the correct period liable to exclusion would be from 25.11.2020 to 25.05.2021, which works out to 182 days.
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Handle my notice → Ask a CA on WhatsAppNo. The time excluded under Explanation 1(iii) to s.11 of the Black Money Act cannot include a period before the s.10(1) notice was served, because exclusion presupposes that the period was inside the limitation to begin with. On the facts the excludable period ran from service of the notice on 25 November 2020 to receipt of the last reply on 25 May 2021, being 182 days and not 195, which moved the last date for the assessment to 29 September 2023. The order passed on 30 September 2023 was one day late and was quashed. This was decided by the ITAT (Shri Amit Shukla, Judicial Member and Shri Arun Khodpia, Accountant Member) and bears on section BMA s.11, section BMA s.10(1), section BMA s.10(3) of the Income Tax Act 1961. It is reported as BMA Nos. 27 and 29/Mum/2025, assessment year 2021-22. Limitation under the Black Money Act is worked almost entirely through the exclusions in Explanation 1 to s.11, and the department routinely counts from the date it wrote to the foreign authority. This fixes the starting point at service of the s.10(1) notice and shows that a single day is enough. If it applies to you, the first step is this: Get the date of service of the s.10(1) notice and the date of every reference to and reply from the foreign authority, on the record.
Notice under s.10(1) of the Black Money Act dated 24 November 2020 was issued and served on the assessee on 25 November 2020 (para 7). The first reference to a foreign tax authority, to France, had been made on 11 November 2020, that is before service of the notice, and the last reply, from the United Arab Emirates, was received on 25 May 2021. The Assessing Officer computed the excludable period at 195 days by counting from the date of the first reference and passed the assessment order for assessment year 2021-22 on 30 September 2023. The assessee appealed on limitation and the Revenue filed a cross appeal. The matter was decided on 2026-03-25 by the ITAT (Shri Amit Shukla, Judicial Member and Shri Arun Khodpia, Accountant Member). On those facts the ITAT held as follows. The assessee's appeal was allowed and the Department's appeal dismissed (para 30). The Tribunal held that the correct period liable to exclusion ran from 25 November 2020 to 25 May 2021, which works out to 182 days (para 23), and that adding 182 days to the normal limitation date of 31 March 2023 gave 29 September 2023 as the last date for passing the assessment order (para 23). The assessment order dated 30 September 2023 was accordingly held to be time barred, without jurisdiction and non est in law, and was quashed.
The Tribunal treated the power to assess under the Black Money Act as a jurisdictional process set in motion in the manner the statute prescribes, and service of the notice under s.10(1) as the point at which the assessee is brought within the proceedings. On that footing the exclusion in Explanation 1(iii) can only operate on time that was already running: exclusion presupposes inclusion within the original field of computation, and a period that never entered the available time cannot be taken out of it. A reference made to a foreign authority before the notice was served therefore could not be counted (paras 16, 17 and 21), leaving 182 excludable days and a last date of 29 September 2023. In the words reproduced by the source cited on this page: "the correct period liable to exclusion would be from 25.11.2020 to 25.05.2021, which works out to 182 days."
It was decided by the ITAT on 2026-03-25 and is reported as BMA Nos. 27 and 29/Mum/2025, assessment year 2021-22. Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere. A Tribunal decision binds the assessing officer and the Commissioner (Appeals) within that Tribunal's jurisdiction, and is persuasive before other benches. It is not binding on a High Court, and a contrary co-ordinate bench decision will be argued against you, so check whether the point has been taken the other way before you build a reply around it. On section BMA s.11, section BMA s.10(1), section BMA s.10(3), the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the taxpayer. The assessee's appeal was allowed and the Department's appeal dismissed (para 30). The Tribunal held that the correct period liable to exclusion ran from 25 November 2020 to 25 May 2021, which works out to 182 days (para 23), and that adding 182 days to the normal limitation date of 31 March 2023 gave 29 September 2023 as the last date for passing the assessment order (para 23). The assessment order dated 30 September 2023 was accordingly held to be time barred, without jurisdiction and non est in law, and was quashed. It arises in Assessment & Scrutiny and Appeals matters, on section BMA s.11, section BMA s.10(1), section BMA s.10(3) of the Income Tax Act 1961, and was decided by Shri Amit Shukla, Judicial Member and Shri Arun Khodpia, Accountant Member. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. Recompute the exclusion from the later of service of the notice and the date of the reference; anything earlier is not excludable. Add the excluded days to the ordinary last date under s.11 and compare with the date on the assessment order. Take limitation as a standalone ground - it is jurisdictional and does not need the merits.
Searched for later treatment; none was found. That is not the same as a source affirming it. The order is of March 2026 and no later decision applying or doubting it was located, nor any appeal against it to the Bombay High Court. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The two readings of this order differ on the number of the operative paragraph, one giving para 28 and the other para 30 for the conclusion; para 30 is taken from the reading that quotes the 'In the result' sentence in terms and is used here. The order records the underlying foreign asset only in passing and the entry does not attempt to describe it. The phrase 'Explanation 1(iii)' is as the order uses it for the exclusion of time taken in obtaining information from an authority outside India. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The assessee's appeal was allowed and the Department's appeal dismissed (para 30). The Tribunal held that the correct period liable to exclusion ran from 25 November 2020 to 25 May 2021, which works out to 182 days (para 23), and that adding 182 days to the normal limitation date of 31 March 2023 gave 29 September 2023 as the last date for passing the assessment order (para 23). The assessment order dated 30 September 2023 was accordingly held to be time barred, without jurisdiction and non est in law, and was quashed.
TaxSphere, “Sunil Kumar Alagh v DDIT (Inv)”, https://taxnotice.vittsphere.com/caselaw/case/sunil-kumar-alagh-v-ddit-bma-11-limitation-exclusion/ (validity last checked 2026-09-16)
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My Black Money Act assessment was passed more than two years after the s.10 notice. The Department says the covid relaxation law extended the time. Did it?
I have an assessment order under s.10(3) of the Black Money Act. The department says the limitation was extended because a request for exchange of information was pending. How long is the period, and how much can that request add to it?
The officer issued a fresh s.10 notice two years after the first one and then assessed. Does the clock run from the second notice?
The assessment under the Black Money Act is not complete, and may now be time-barred. Can they still summon me on a s.51 complaint?
