SNC LAVALIN ACRES INC vs. ASSTT DIRECTOR OF INCOME TAX

ITA - 126 / 2013HC Delhi12 March 20131 pages

For Petitioner: HUSNAL SYALI

AI SummaryPartly Allowed

What did the High Court hold?

The Delhi High Court admitted the appeal, ITA 126/2013, and framed a substantial question of law. The court noted that an identical issue had arisen for assessment year 2001-02, and the appeal for that year had already been admitted with a substantial question of law framed. Based on this precedent and after hearing counsel for both parties, the court decided to admit the present appeal. The substantial question of law framed concerns the interpretation of Article 7(1)(b) of the Indo-Canada AADT in conjunction with the scope of work in the contract between NHPC and the appellant, to determine if the appellant's entire income was taxable in India through its permanent establishment. The court dispensed with the printing of paper books and listed the appeal along with ITA No. 661/2007. No decision on the merits of the substantial question of law has been made at this stage; the judgment only pertains to the admission of the appeal.

What were the facts?

The appeal, ITA 126/2013, was filed by SNC Lavalin Acres Inc. (the appellant) against an order passed by the Assistant Director of Income Tax (the respondent). The assessment year in question is not explicitly stated for this specific appeal, but it is mentioned that an identical issue arose for assessment year 2001-02. The appellant sought to challenge a decision concerning the taxability of its income in India. The High Court of Delhi condoned the delay in filing the appeal and allowed the application for delay condonation. The court was informed that a similar issue for assessment year 2001-02 had already been admitted, and a substantial question of law framed. Consequently, the present appeal was also admitted.

What were the issues?

1. Whether, on a true and correct interpretation of Article 7(1)(b) of the Indo-Canada Double Taxation Avoidance Agreement (AADT) read with the scope of work in the contract between NHPC and the petitioner, the entire income of the petitioner company was liable to tax in India in the assessment of the permanent establishment? Assessee's Contention: The appellant, SNC Lavalin Acres Inc., argued that the issue is identical to one that arose for assessment year 2001-02, where the appeal was admitted and a substantial question of law framed. This implies the appellant believes the current appeal should also be admitted and considered on its merits based on established legal principles. Revenue's Contention: The respondent, Assistant Director of Income Tax, was represented by counsel. No specific arguments are recorded in the judgment for the revenue regarding the substantial question of law at this stage, other than their participation in the proceedings.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF DELHI AT NEW DELHI . . . ITA 126/2013 . . . SNC LAVALIN ACRES INC ..... Appellant . Through: Mr M.S. Syali, Sr. Adv. with . Ms Husnal Syali, Mr Mayank Nagi, Advs. . . . versus . . . ASSTT DIRECTOR OF INCOME TAX ..... Respondent . Through: Mr Kamal Sawhney, Sr. St. Counsel. . . . CORAM: . HON'BLE MR. JUSTICE BADAR DURREZ AHMED . HON'BLE MR. JUSTICE R.V.EASWAR . . . O R D E R . 12.03.2013 . . . CM No. 3924/2013 . Allowed, subject to all just exceptions. . CM No. 3925/2013 . The delay is condoned. . ITA No. 126/2013 . We are informed by Mr Syali that in respect of the assessment year 2001-02 an identical issue had arisen and the appeal has already been admitted and the substantial question of law has also been framed. Consequently, after hearing the counsel for the parties this appeal is also admitted and the following substantial question of law is framed for our consideration:- . . . ?Whether on a true and correct interpretation of Article 7(1)(b) of the Indo-Canada AADT read with the scope of work in the contract between NHPC and the petitioner, the entire income of the petitioner company was liable to tax in India in the assessment of permanent establishment?? . . . Printing of paper books is dispensed with. . List along with the ITA No. 661/2007. . . . . . BADAR DURREZ AHMED, J . . . . . R.V.EASWAR, J . MARCH 12, 2013 . kb . . . . . $ 7 .

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