No Penalty Where Claim Is Based On Binding High Court Law Later Reversed By Top Court: Bombay High Court

The Bombay High Court on 30 March held that if a taxpayer made a deduction claim based on a binding High Court judgment, penalty under Section 270A of the Income Tax Act cannot be imposed subsequently, merely because the claim was later disallowed following a Supreme Court ruling.A Division Bench of Justices B. P. Colabawalla and Firdosh P. Pooniwalla held that penalty is not automatic and does not arise where a taxpayer makes a bona fide claim based on the prevailing legal position. It noted: ...

No TDS Payable On Pfizer Products' Cost-Sharing Payments To Pfizer Ltd. Without Profit Element: Bombay HC

Holding that reimbursements without any profit element do not attract TDS, the Bombay High Court has dismissed an income tax appeal filed by the Revenue against Pfizer Products India Pvt. Ltd. over cross-charges of Rs.14,51,77,000 paid to its sister concern-Pfizer Ltd.A Division Bench of Justice M. S. Karnik and Justice S. M. Modak held, "The cross-charge paid by the Assessee-Respondent in terms of the cost-sharing agreement between the Assessee and M/s. Pfizer Ltd, did not have any...

Bombay High Court Admits Limited 115JB Questions In ACC Case, Holds Settled Issues Not Appealable

The Bombay High Court on 16 March partly admitted an appeal filed by the Department against ACC Limited, holding that several issues raised by the Revenue were already covered by binding precedents and therefore did not give rise to any substantial question of law. A Bench of Justices B.P. Colabawalla and Firdosh P. Pooniwalla, however, admitted the appeal on four questions concerning computation of book profits under Section 115JB of the Income Tax Act, 1961. They held: “The appeal is...

Developer Undertaking Risk And Execution Qualifies For Section 80-IA Deduction: Bombay High Court

The Bombay High Court on 11 March held that a taxpayer-company undertaking substantial development work, investment risk and technical execution cannot be treated as a mere works contractor and is entitled to deduction under Section 80-IA(4) of the Income Tax Act for profits from infrastructure projects. A Bench comprising Justices M. S. Karnik and S. M. Modak dismissed the Revenue's appeals against Patel Engineering Ltd., holding that the latter acted as a “developer” of infrastructure...

Old Income Tax Demands Cannot Surface On Portal Without Serving Underlying Orders: Bombay High Court

The Bombay High Court recently observed that old income tax demands could not be sustained where the underlying orders were not made available to the taxpayer, observing that such demands cannot be permitted to surface without proper disclosure. “Old matters and demands cannot be allowed to suddenly surface on the portal without the underlying orders being available and served. Consequently, the impugned demands cannot be sustained,” the court said. A Division Bench of Justices B. P....

Borrower Cannot Use Court Receiver Appointment In Arbitration Proceedings To Resist SARFAESI Action: Bombay HC

The Bombay High Court has held that a borrower cannot rely on the appointment of a Court Receiver, which was ordered to retain possession of a mortgaged property pending arbitration, to resist enforcement of a security interest under the SARFAESI Act, particularly when such enforcement has not been challenged. Justice Arif S. Doctor, in a dispute between Aditya Birla Finance Ltd and Ma Durga Hardware Stores, said that it would be inequitable for the respondent to use the Court Receiver's...

Appeal Not Maintainable Against Arbitral Tribunal's Impleadment Order: Bombay High Court

The Bombay High Court on 8 April, held that an order allowing impleadment of parties cannot be challenged in appeal under Section 37 of the Arbitration and Conciliation Act, 1996 merely because the Arbitral Tribunal passed it under Section 17, which empowers the Tribunal to issue interim and procedural orders during arbitration to manage the proceedings and grant temporary reliefs. A Bench of Justice Somasekhar Sundaresan clarified that Section 37 contains an exhaustive list of appealable...

Bombay HC Quashes SCNs Against Foreign Exporter, Says Customs Act Had No Extra-Territorial Reach Pre-2018

The Bombay High Court has quashed show cause notices issued by customs authorities against a German textile machinery manufacturer and its Indian subsidiary, holding that the notices were without jurisdiction and that a foreign exporter cannot be made liable for alleged misdeclaration by Indian importers for a period prior to the 2018 amendment to the Customs Act. A Bench of Justice G. S. Kulkarni and Justice Aarti Sathe held that proceedings initiated against a foreign entity situated outside...

Bombay High Court Orders Fresh Review of V Ships' GST Refund Plea, Says Nature Of Service Not Determined

The Bombay High Court has recently set aside orders rejecting GST refund claims of V Ships India Pvt. Ltd., holding that the appellate authority failed to examine the terms of the service agreement before deciding whether the company's services were exports or intermediary services. A Bench of Justice G. S. Kulkarni and Justice Aarti Sathe said the absence of any findings on the agreement, which was relevant to determining the nature of services, vitiated the appellate orders. V Ships India...

Gateway Of India Jetty Construction Dispute: Bombay HC Refuses To Stop ₹31.86 Cr Bank Guarantee Encashment

The Bombay High Court has recently declined to restrain the invocation and encashment of bank guarantees worth Rs 31.86 crore in a dispute between RKEC Projects Limited and the Maharashtra Maritime Board over the construction of a passenger jetty and terminal near the Gateway of India in Mumbai. The ruling came on a petition under Section 9 of the Arbitration and Conciliation Act, 1996, which allows courts to grant temporary protection until disputes are decided through arbitration, before...

Article 226 Can Be Invoked Against Non Est MSME Award Violating Statutory Provisions: Bombay High Court

The Bombay High Court on 2 April, held that a writ petition under Article 226 is maintainable against an award passed by the Micro and Small Enterprises Facilitation Council when such award is non est in law and contrary to mandatory statutory provisions. Justice S.G. Chapalgaonkar observed that where an impugned award is passed in violation of the mandatory provisions of the MSMED Act, 2006 and the Arbitration and Conciliation Act, 1996, it cannot be treated as a valid arbitral award in the...

Bombay High Court Indicates It Will Pass Order Protecting Kartik Aaryan's Personality Rights

The Bombay High Court on Wednesday indicated that it will pass an order protecting the personality and publicity rights of Bollywood actor Kartik Aaryan, according to his counsel, who spoke to Live LawBiz. The relief would bein a suit alleging widespread digital misuse of his likeness through AI-generated content and unauthorised merchandise.The matter was heard by Justice Sharmila U. Deshmukh. Aaryan has moved the High Court seeking a broad John Doe injunction against 16 defendants, including...