M/S. LG ELECTRONICS INDIA PRIVATE LIMITED vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 13 (1) AND OTHERS

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W.P.(C)-3036/2022HC Delhi2022:DHC:76425 February 20222 pages
AI SummaryRemanded

What did the High Court hold?

The High Court noted the submission by the revenue that the rectification of the intimation under Section 143(1) had been carried out. The demand raised in the intimation for Assessment Year 2020-21 was cancelled. The Court was informed that the accounting of the rectification order was pending completion at CPC due to technical reasons but was expected to be finalized. In light of these developments, the Court directed the CPC to determine and process the refund due to the Petitioner in accordance with the law. The Court did not explicitly decide on the validity of the original intimation but addressed the issue through the rectification process. The primary relief granted was the direction for refund processing.

What were the facts?

M/s. LG Electronics India Private Limited (the Petitioner) filed a writ petition challenging an intimation dated March 31, 2021, issued under Section 143(1) of the Income Tax Act, 1961. The Petitioner alternatively sought a direction to the respondents to dispose of an application dated April 14, 2021, filed under Section 154 of the Act for rectification of the intimation. The Petitioner contended that it opted for taxation under Section 115BAA of the Act, which prescribes a tax rate of 22%, but the respondents applied a tax rate of 25% as mandated under Section 115BA of the Act. The assessment year in question is 2020-21.

What were the issues?

1. Whether the intimation dated March 31, 2021, issued under Section 143(1) of the Income Tax Act, 1961, which allegedly applied an incorrect tax rate of 25% instead of the opted 22% under Section 115BAA, is valid. Assessee's Contention: The Petitioner argued that it had opted for taxation under Section 115BAA of the Act, which specifies a tax rate of 22%. However, the impugned intimation incorrectly applied the tax rate of 25% as per Section 115BA of the Act. The Petitioner sought rectification of this error. Revenue's Contention: The revenue, through its counsel, stated that after obtaining approval from the Director of Income Tax, CPC, Bangalore, the rectification rights were reverted to CPC. Rectification of the intimation under Section 143(1) had been carried out. However, due to technical reasons, the accounting of the order under Section 154 could not be completed on February 24, 2022, but was expected to be completed by February 25, 2022. The demand raised in the intimation for Assessment Year 2020-21 was cancelled, and once the rectification order accounting was completed, the refund due would be determined.

Which sections of the Income-tax Act were involved?

Section 143(1),Section 154,Section 115BAA,Section 115BA

AI-generated summary — verify with the full judgment below

W.P.(C) 3036/2022 Page 1 of 2 $~A-6 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 3036/2022 M/S. LG ELECTRONICS INDIA PRIVATE LIMITED ..... Petitioner Through: Mr.Deepak Chopra, Advocate. versus DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 13 (1) AND OTHERS ..... Respondents Through: Ms.Vibhooti Malhotra, Advocate. % Date of Decision: 25th February, 2022 CORAM: HON'BLE MR. JUSTICE MANMOHAN HON'BLE MR. JUSTICE NAVIN CHAWLA J U D G M E N T MANMOHAN, J (Oral): 1. Present writ petition has been filed challenging the intimation dated 31st March, 2021, issued under Section 143(1) of the Income Tax Act, 1961 (‘Act’). In the alternative, Petitioner seeks a direction to the Respondents to dispose-of the application dated 14th April, 2021, filed under Section 154 of the Act, seeking rectification of the impugned intimation. 2. In the present writ petition, it has been averred that though the Petitioner had opted to be taxed under Section 115BAA of the Act, wherein tax rate of 22% has been prescribed, yet the Respondents by the impugned order has applied the tax rate of 25% as mandated under Section 115BA of the Act. 2022:DHC:764-DB

W.P.(C) 3036/2022 Page 2 of 2 3. Today, Ms.Vibhooti Malhotra, learned counsel for the respondents, states that after taking the approval of Director of Income Tax, CPC, Bangalore the rectification rights in this case was reverted to CPC and rectification of intimation under Section 143(1) has been carried out. However, due to some technical reasons the accounting of order under Section 154 could not be completed on 24th February, 2022 and the same may get completed by 25th February, 2022. The demand raised in intimation under Section 143(1) for Assessment Year 2020-21 has been cancelled and once the accounting of rectification order is completed at CPC, refund due will be determined. 4. In view of the aforesaid development, the CPC is directed to determine and process the refund in accordance with law. 5. With the aforesaid directions, the present writ petition stands disposed of. MANMOHAN, J NAVIN CHAWLA, J FEBRUARY 25, 2022 TS 2022:DHC:764-DB

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