THE COMMISSIONER OF INCOME TAX - INTERNATIONAL TAXATION -3 vs. SMITH DETECTION ASIA PACIFIC PTE LTD.

ITA - 204 / 2025HC Delhi07 July 20252 pages

For Petitioner: RUCHIR BHATIA

AI SummaryRemanded

What did the High Court hold?

The High Court noted that the ITAT had allowed the assessee's appeals for AY 2020-21 and AY 2021-22 by following its earlier decision concerning a preceding AY. This prior decision had also been upheld by the High Court. The Revenue's counsel indicated that the basis for the addition by the Assessing Officer was the artificial splitting of a contract for supply and installation to facilitate overseas supply. The Revenue sought to verify if this issue was also raised for AY 2019-20. The Court, at the request of the Revenue's counsel, listed the matter for further hearing on July 9, 2025, to examine this aspect. No final decision on the merits of the ITAT's order was rendered in this proceeding; the matter was adjourned for further consideration.

What were the facts?

The Revenue has filed an appeal under Section 260A of the Income Tax Act, 1961, challenging a common order dated January 10, 2025, passed by the Income Tax Appellate Tribunal (ITAT). The ITAT's order pertains to Assessment Year (AY) 2020-21 (ITA No. 2396/Del/2023) and AY 2021-22 (ITA No. 3264/Del/2023), in the case of Smiths Detection Asia Pacific Pte Limited versus the Deputy Commissioner of Income Tax (DCIT). The ITAT had allowed the assessee's appeal, following its prior decision for an earlier AY, which had also been upheld by the High Court. The Assessing Officer's addition for AY 2020-21 was based on the finding that the contract for supply and installation was artificially split to facilitate the overseas supply of equipment. The Revenue's counsel sought to ascertain if this issue was also raised for AY 2019-20.

What were the issues?

1. Whether the ITAT erred in allowing the assessee's appeal for AY 2020-21 and AY 2021-22, thereby deleting the additions made by the Assessing Officer. Assessee's Contention: The ITAT allowed the appeal, following its earlier decision for a preceding AY, which had been upheld by the High Court. This implies the assessee argued that the issue was already decided in its favour and that the AO's addition was incorrect. Revenue's Contention: The Revenue's counsel submitted that the addition was based on the finding that the contract of supply and installation was artificially split to provide for the supply of equipment overseas. The Revenue sought to examine whether this specific issue was also raised in AY 2019-20, indicating a potential challenge to the ITAT's decision on the merits of the splitting of the contract.

Which sections of the Income-tax Act were involved?

Section 260A

AI-generated summary — verify with the full judgment below

$~42 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA 204/2025 THE COMMISSIONER OF INCOME TAX - INTERNATIONAL TAXATION -3 .....Appellant Through: Mr Ruchir Bhatia, SSC, Mr Anant Mann, JSC Ms Aditi Sabharwal and Mr Abhishek Anand, Advocates. versus SMITH DETECTION ASIA PACIFIC PTE LTD. .....Respondent Through: None. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRU HON'BLE MR. JUSTICE TEJAS KARIA O R D E R % 07.07.2025 1. The Revenue has filed the present appeal under Section 260A of the Income Tax Act, 1961 [the Act], inter alia, impugning the common order dated 10.01.2025 passed by the learned Income Tax Appellate Tribunal [ITAT] in ITA No.2396/Del/2023 in respect of the Assessment Year [AY] 2020-21 and ITA No.3264/Del/2023 in respect of the AY 2021-22 captioned Smiths Detection Asia Pacific Pte Limited vs DCIT. 2. It is noted that the ITAT has allowed the appeal following the earlier decision in respect of earlier AY, which has also been upheld by this Court. 3. Mr Bhatia, the learned counsel appearing for the Revenue submits that basis for the addition made by the Assessing Officer [AO] in AY 2020- 21 is the finding to the effect that the contract of supply and installation has been artificially split to provide for supply of equipment overseas. He seeks This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 27/03/2026 at 12:04:59

to examine whether the said issue has also been raised in AY 2019-20. 4. At his request, list on 09.07.2025. VIBHU BAKHRU, J TEJAS KARIA, J JULY 07, 2025 M Click here to check corrigendum, if any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 27/03/2026 at 12:04:59

Recent GST High Court judgments

Search GST case law →