Bombay High Court Says Income Tax Assessment Cannot Stand On Quashed Revision Order

The Bombay High Court has ruled that an assessment order cannot survive when the revision order on which it was based has already been quashed by the income tax tribunal.Justice G.S. Kulkarni and Justice Dr. Neela Gokhale observed that the Assessing Officer could not have proceeded with the assessment after the tribunal had quashed the underlying Section 263 order. The court also rejected the Revenue's contention that the pending challenge against the tribunal's decision changed this...

Tax Paid Twice On Same Income Is 'Unjust Enrichment' By Government: Delhi High Court

Holding so, the court allowed the taxpayer to file a revised return after finding that it had inadvertently paid tax twice on the same interest income.

SEZ Units Cannot Be Denied Stamp Duty Exemption Due To Pre-Ordinance Lease: Gujarat High Court

The Gujarat High Court on 2 September held that an SEZ unit cannot be denied exemption from stamp duty and registration fee merely because its lease deed was executed before the Gujarat Special Economic Zone Ordinance, 2004 came into force, where the investment was made on the basis of the State Government's earlier SEZ policy promising such fiscal incentives. A Division Bench comprising Chief Justice Sunita Agarwal and Justice D.N. Ray dismissed the State Government's appeal against an order...

Turnover Filter Cannot Be Applied Mechanically To Exclude Transfer Pricing Comparables: ITAT Delhi

The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 9 September held that transfer pricing comparables cannot be excluded merely by applying a rigid turnover filter where the entities are otherwise functionally comparable. A Division Bench comprising Judicial Member Satbeer Singh Godara and Accountant Member Manish Agarwal partly allowed twin appeals filed by GE India Industrial Pvt. Ltd. for assessment years 2007-08 and 2008-09 against transfer pricing adjustments and various...

Individual Notice To Partners Not Needed For Firm's Tax Recovery: Madras High Court

The Madras High Court on 24 August held that individual notice to partners is not required when the Income Tax Department initiates recovery proceedings against the assets of a defaulting partnership firm. It clarified that individual notice is necessary where recovery proceedings are initiated against the personal assets of an individual partner. Justice Senthilkumar Ramamoorthy disposed of four connected writ petitions concerning the recovery of income tax dues from RJK Investments and the...

Punjab & Haryana High Court Strikes Down Section 147A Income Tax Act As Unconstitutional

The Punjab & Haryana High Court has struck down the newly inserted Section 147A of the Income Tax Act, 1961, holding the provision unconstitutional. The provision was introduced retrospectively to clarify the role of the Jurisdictional Assessing Officer (JAO) in reassessment proceedings.A bench of Justice Deepak Sibal and Justice Rupinderjit Chahal pronounced the decision today. A detailed judgment is awaited.Section 147A was inserted with retrospective effect from April 1, 2021. It provides...

Madras High Court Upholds Deletion Of ₹70.95 Cr. Tax Additions In Bogus Long Term Capital Gains Cases

The Madras High Court on 28 August upheld the Income Tax Appellate Tribunal's orders deleting tax additions of Rs. 32.90 crore and Rs. 38.05 crore in cases concerning Long Term Capital Gains claimed from the sale of shares in PFL Infotech Limited and Risa International Limited. A Division Bench comprising Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan dismissed the Revenue's appeals and the connected appeals concerning penalty under Section 271(1)(c) of the Income Tax...

TPO Cannot Reject Comparables Merely To Adopt Department's Preferred Set: Karnataka High Court

The Karnataka High Court on 28 August held that a Transfer Pricing Officer (TPO) cannot reject comparable companies selected by a taxpayer merely to replace them with a standard set of comparables preferred by the Income Tax Department, holding that the selection or exclusion of comparables must satisfy the requirements under the Income Tax Act and Rule 10B of the Income Tax Rules. A Division Bench of Justices S.G. Pandit and K.V. Aravind allowed the batch of transfer pricing appeals, including...

'Classic Case Of Change Of Opinion': Delhi High Court Rejects Reassessment Of NTPC's ₹17.59 Crore Income

The Delhi High Court has rejected the Income Tax Department's appeal challenging the annulment of reassessment proceedings against NTPC Limited, holding that the subsequent Assessing Officer (AO) had initiated the proceedings merely because he disagreed with the view taken by his predecessor.The Division Bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta observed that the reassessment was a "classic case of change of opinion", particularly since the issues forming the basis of reassessment...

Three-Month Limitation For Consequential Orders Cannot Justify Delayed Vivad Se Vishwas Refunds Gujarat High Court

The Gujarat High Court has ruled that the tax department cannot rely on the three-month time limit for passing a consequential order under the Income-tax Act to justify delaying refunds under the Vivad se Vishwas scheme.It held that the department was required to pass the necessary order and issue the refund by July 31, 2021, as prescribed by the Central Board of Direct Taxes (CBDT), and directed it to pay interest at 6% per annum on the delayed refund from August 1, 2021 to March 2, 2024.“The...

Income Tax Prosecution Cannot Survive Once Assessment Is Set Aside On Merits: Gauhati High Court

The Gauhati High Court on 2 September held that an income tax prosecution cannot continue when the assessment on which it is based has been set aside on merits, and that separate complaints against company directors for the same alleged offence are not maintainable when the company itself has not been arraigned as an accused. Justice Robin Phukan allowed three petitions filed by Flamingo Breweries Private Limited and its two directors and quashed the criminal complaints pending before the...

Information-Seeking Notice Cannot Be Treated As Show Cause Notice In Transfer Pricing Case: Bombay High Court

The Bombay High Court has ruled that notices issued by a Transfer Pricing Officer seeking information from a taxpayer cannot substitute the show cause notice required before determining the arm's length price.A Division Bench of Justice B.P. Colabawalla and Justice Farhan P. Dubash observed, “Further the notice issued by the Transfer Pricing Officer under Section 92CA(2) of the Act seeking information from an Assessee cannot be said to be a Show Cause Notice issued as per the proviso to Section...