COPERION GMBH vs. COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION) -1 NEW DELHI & ANR.

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W.P.(C)/17400/2024HC DelhiDLHC01094757202417 December 2024Bench: HON'BLE MR. JUSTICE TUSHAR RAO GEDELA,HON'BLE THE ACTING CHIEF JUSTICE2 pages
AI SummaryRemanded

What did the High Court hold?

The Delhi High Court set aside the impugned order dated 21.11.2024 passed under Section 197 of the Income Tax Act, 1961. The Court remanded the matter back to the Assessing Officer (AO) for a fresh consideration. The reasoning was based on the concession made by the Revenue's counsel, who acknowledged that some of the petitioner's submissions, both in the writ petition and those filed before the AO, might not have been considered. The High Court directed the AO to pass a final order within a period of four weeks from the date of the order, taking into account the averments made in the writ petition and the submissions filed by the petitioner. The principle established is that an order under Section 197 should be passed after due consideration of all material and submissions presented by the assessee.

What were the facts?

The petitioner, COPERION GMBH, filed a writ petition challenging an order dated 21.11.2024 passed under Section 197 of the Income Tax Act, 1961. The impugned order granted the petitioner benefits of lower withholding tax at 13% (excluding surcharge and educational cess) on revenues of ₹.2,57,45,280/-. The petitioner had sought a lower withholding tax rate on projected revenues of ₹ 23,00,00,000/- from Technimont SPA India Project Office, submitting work orders and estimated quantum of work. The petitioner's grievance was not with the rate but with the limited amount of revenue to which the lower rate was applied, contending it was possibly covered by a single work order and that its submissions were not considered by the Assessing Officer (AO).

What were the issues?

1. Whether the Assessing Officer (AO) erred in not considering the submissions and relevant material furnished by the petitioner while passing the order under Section 197 of the Income Tax Act, 1961, concerning the determination of lower withholding tax rate and the quantum of revenue it applies to? Assessee's Contentions: The petitioner argued that the AO failed to consider its submissions and the relevant material, including work orders and estimated quantum of work, when determining the lower withholding tax rate and confining it to ₹.2,57,45,280/-. The petitioner contended that this amount was likely covered by a single work order and that the AO should have considered its projected revenues of ₹ 23,00,00,000/-. Revenue's Contentions: The Revenue, through its counsel, fairly stated that the matter could be remanded to the AO for a fresh determination in light of the submissions made by the petitioner in its writ petition and before the AO, acknowledging that some submissions might not have been considered.

Which sections of the Income-tax Act were involved?

Section 197

AI-generated summary — verify with the full judgment below

$~78 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 17400/2024, CM APPL. 74064/2024 & CM APPL. 74065/2024

COPERION GMBH

.....Petitioner Through: Mr. Piyush Kaushik and Mr. Tanveer Zaqi, Advocates.

versus COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION) -1 NEW DELHI & ANR.

.....Respondents Through: Mr. Puneet Rai, Sr. Standing Counsel alongwith Mr. Ashvini Kumar, Mr. Rishabh, JSCs, Mr. Nikhil Jain and Ms. Srishti Sharma, Advocates.

CORAM:

HON'BLE THE ACTING CHIEF JUSTICE

HON'BLE MR. JUSTICE TUSHAR RAO GEDELA

O R D E R %

17.12.2024 W.P.(C) 17400/2024 & CM APPL. 74064/2024 1. Issue notice. 2. Learned counsel appearing for the respondents accepts notice. 3. The petitioner has filed the present petition impugning an order dated 21.11.2024 passed under Section 197 of the Income Tax Act, 1961 (hereafter the Act) whereby the petitioner has been granted benefits of a lower withholding tax (@ 13% excluding surcharge and educational cess) in respect of revenues of ₹.2,57,45,280/-. 4. It is the petitioner’s case that it had requested for lower rate of withholding tax in respect of projected revenues of ₹ 23,00,00,000/- (Twenty-three Crores) which it claimed to have received from Technimont SPA India Project Office (hereafter Technimont). The petitioner had also submitted two work orders issued by Technimont as well as the estimated 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 23/12/2024 at 12:14:43

quantum of work that would be executed pursuant to the said two work orders. 5. The petitioner is not aggrieved by the rate of withholding tax, which has been determined (@ 13% excluding surcharge and educational cess); its grievance stems from confining the said withholding tax to an amount of ₹.2,57,45,280/-. According to the petitioner, the said amount is possibly covered under a single work order. 6. Petitioner contends that it had furnished its submissions alongwith relevant material, which has not been considered by the Assessing Officer (AO). 7. Mr. Rai, learned counsel appearing for the Revenue fairly states that the matter may be remanded to the AO for determining afresh in the light of the submissions made by the petitioner in its writ petition as well as the submissions filed before the AO, as is apparent that some of the submissions have not been considered. 8. In view of the above, we set aside the impugned order and remand the matter to the AO for consideration afresh, in the light of the averments made in the present petition as well as the submissions filed by the petitioner. 9. We request the AO to pass a final order within a period of four weeks from date. 10. The petition is disposed of in the aforesaid terms. 11. Pending applications also stand disposed of.

VIBHU BAKHRU, ACJ

TUSHAR RAO GEDELA, J DECEMBER 17, 2024/kct 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 23/12/2024 at 12:14:43

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