ACIT, DELHI vs. TATA NYK SHIPPING PTE LTD, SINGAPORE

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ITITA 18/DEL/2025Status: DisposedITAT Delhi15 April 20263 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the assessment order, which was passed pursuant to the order of the Commissioner of Income Tax (International Taxation-3), Delhi, under Section 263 of the Income Tax Act, 1961, could not be sustained because the said Section 263 order had been set aside by a coordinate bench of the Tribunal in ITA No. 1067/Del/2022 by its order dated March 9, 2023. The Tribunal found no error or infirmity in the order of the Ld. CIT(A) who had allowed the appeal of the assessee. The reasoning was that the foundation of the assessment order was the Section 263 order, and once that foundation was removed by the Tribunal's earlier decision, the assessment order derived no legal validity. Therefore, the Tribunal found no merits in the grounds of appeal raised by the Revenue and dismissed the appeal. No issue was expressly left undecided.

What were the facts?

The appeal is filed by the Assistant Commissioner of Income Tax (ACIT) against the order of the Commissioner of Income Tax (Appeals) (CIT(A)) dated August 20, 2025, for Assessment Year 2016-17. The assessee, Tata Nyk Shipping Pte Ltd., is a foreign company based in Singapore. The core of the dispute stems from an order passed under Section 263 of the Income Tax Act, 1961, by the Commissioner of Income Tax (International Taxation-3), Delhi, on March 25, 2022. This Section 263 order was previously challenged by the assessee before the Income Tax Appellate Tribunal (ITAT) in ITA No. 1067/Del/2022. The ITAT, by an order dated March 9, 2023, had quashed the Section 263 order. The assessee contended that since the Section 263 order was set aside, any assessment order passed pursuant to it lacks legal validity and the CIT(A) had rightly allowed the assessee's appeal.

What were the issues?

1. Whether the assessment order, passed pursuant to a Section 263 order that has been quashed by the Tribunal, can have legal sanctity? (Question of law, turning on Section 263 of the Income Tax Act, 1961). Assessee's Contentions: The assessee argued that the order passed by the Commissioner of Income Tax (International Taxation-3), Delhi, under Section 263 of the Act on March 25, 2022, was quashed by the Tribunal in ITA No. 1067/Del/2022 by an order dated March 9, 2023. Consequently, any assessment order that was passed pursuant to this quashed Section 263 order cannot possess legal sanctity. The assessee further submitted that the CIT(A) had correctly allowed the assessee's appeal, and therefore, the present appeal filed by the Revenue is liable to be dismissed. Revenue's Contentions: The Revenue, through its Departmental Representative, relied on the orders of the lower authorities and sought the dismissal of the appeal.

Which sections of the Income-tax Act were involved?

Section 263

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI

Hearing: 06.04.2026Pronounced: 15.04.2026

1 ITA No 18/DEL/2025 ACIT VS. Tata Nyk Shipping PTE

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI BENCH ‘D’ NEW DELHI BEFORE SHRI YOGESH KUMAR U.S, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER IT(IT) A No. 18/Del/2025 ( A.Y 2016-17) Assistant Commissioner of Vs Tata Nyk Shipping Pte Ltd. Income Tax, Room No. 416, 4th 6, Shenton Way # 18-08B, Oue Floor, E-2, Block Dr. S. P. Downtown 2 Singapore, Mukherjee Civic Centre, Foreign, Singapore New Delhi PAN: AADCT9945P (APPLICANT) (RESPONDENT) Appellant by Sh. S. K. Agarwal, CA Respondent by Sh. M. S. Nethrapal, CIT DR Date of Hearing 06.04.2026 Date of Pronouncement 15.04.2026 ORDER PER YOGESH KUMAR, U.S. JM: The present appeal is filed by the Assessee against the order of Ld.

Commissioner of Income Tax (Appeals)(‘Ld. CIT(A)’ for short), Delhi-43,

dated 20/08/2025 for the Assessment Year 2016-17.

2.

The Ld. Counsel for the Assessee submitted that order passed

under Section 263 of the Income Tax Act, 1961, (‘Act’ for short) dated

25/03/2022 has been quashed by the Tribunal vide order passed dated

09/03/2023 in ITA No. 1067/Del/2022, therefore, the assessment order

pursuant to the order passed u/S 263 of the Act cannot have legal

sanctity. Further submitted that the Ld. CIT(A) has rightly allowed the

Appeal of the Assesseeand the present Appeal filed by the Revenue is

liable to be dismissed.

2 ITA No 18/DEL/2025 ACIT VS. Tata Nyk Shipping PTE

3.

Per contra, the Ld. Departmental Representative relying on the

orders of the Lower Authorities sought for dismissal of the Appeal.

4.

We have heard both the parties and perused the material available

on record. As per the material available on record, it is found that an

order u/s 263 of the Act came to be passed by the Commissioner of

Income Tax (International Taxtion-3) Delhi under Section 263 of the Act

on 25/03/2022, which has been challenged by the Assessee before this

Tribunal in ITANo. 1067/Del/2022. The Co-ordinate Bench of the

Tribunal vide order dated 09/03/2023, allowed the Appeal of the

Assessee and set aside the order dated 25/03/2022 passed by the

CIT(International Taxtion-3-Delhi). Thus, the impugned assessment

order passed pursuant to the order of the CIT(International Taxtion-3-

Delhi) under Section 263 of the Act cannot be sustained. Thus, we find

no error or infirmity, the order of the Ld. CIT(A) in allowing the Appeal of

the Assessee vide order impugned. Finding no merits in the Grounds of

Appeal of the Revenue, the Appeal of the Revenue is dismissed.

Order pronounced in the Open Court on this 15th Day of April, 2026

Sd/- Sd/- (SANJAY AWASTHI) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 15/04/2026 R. Naheed *

3 ITA No 18/DEL/2025 ACIT VS. Tata Nyk Shipping PTE

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