M/S IDEMIA SYSCOM INDIA PRIVATE LIMITED vs. ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE- 25

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W.P.(C)/8463/2025HC DelhiDLHC01038180202504 July 2025Bench: HON'BLE MR. JUSTICE VIBHU BAKHRU,HON'BLE MR. JUSTICE TEJAS KARIA3 pages
AI SummaryRemanded

What did the High Court hold?

The Delhi High Court did not entertain the writ petition, finding that the petitioner had an equally efficacious remedy available. The Court noted that the petitioner was aggrieved by the Draft Assessment Order and the order passed by the TPO. Therefore, the Court clarified that if the petitioner files objections against the draft assessment order before the Dispute Resolution Panel (DRP), the DRP shall consider these objections on merits. The DRP is to bear in mind the decision of the High Court in M/s Giesecke and Devrient India Pvt. Ltd. v. Deputy Commissioner of Income Tax 2.1 & Ors. The Court explicitly reserved all rights and contentions of the petitioner. The petition was disposed of with these observations, and all pending applications were also disposed of.

What were the facts?

The petitioner, M/s IDEMIA SYSCOM INDIA PRIVATE LIMITED, filed a writ petition before the Delhi High Court challenging a Show Cause Notice dated 27.05.2025 issued by the Assistant Commissioner of Income Tax, Central Circle-25, for Assessment Year 2020-21. The petitioner contended that the Draft Assessment Order passed under Section 144C(1) was not in conformity with the order of the Transfer Pricing Officer (TPO) regarding the Arm's Length Price (ALP) of an international transaction. The petitioner argued that the Assessing Officer (AO) lacked jurisdiction to determine the ALP and must adhere to the TPO's decision. The AO had issued the impugned Show Cause Notice proposing transfer pricing adjustments beyond the TPO's order, and subsequently passed a draft assessment order.

What were the issues?

1. Whether the Assessing Officer has the jurisdiction to determine the Arm's Length Price (ALP) contrary to the order passed by the Transfer Pricing Officer (TPO) under Section 92CA of the Income Tax Act, 1961? 2. Whether the Show Cause Notice dated 27.05.2025 and subsequent assessment proceedings are liable to be quashed for lack of jurisdiction and expiry of the period of limitation? Assessee's Contentions: The petitioner argued that the AO does not possess the jurisdiction to determine the ALP and is bound to pass orders in conformity with the TPO's decision. The Show Cause Notice sought to travel beyond the TPO's order and proposed adjustments not in line with it. The petitioner also raised concerns about jurisdiction and limitation. Revenue's Contentions: The judgment does not record specific contentions from the revenue. However, it notes that the petitioner has an equally efficacious remedy before the Dispute Resolution Panel (DRP) or the Commissioner of Income Tax (Appeals).

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144C(1),Section 92CA

AI-generated summary — verify with the full judgment below

$~17 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 8463/2025, CM APPLs. 36807/2025 & 38547/2025

M/S IDEMIA SYSCOM INDIA PRIVATE LIMITED .....Petitioner Through: Mr. Mukesh Butani, Mr. Shankey Agrawal, Mr. Siddharth Agrawal and Mr. Saurabh Nandy, Advocates.

Versus

ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE- 25

.....Respondent Through: Mr. Gaurav Gupta, Sr. Standing Counsel with Mr. Shivendra Singh and Mr. Yojit Pareek, Jr. Standing Counsels and Mr. Surya Jindal, Advocate for Revenue.

CORAM:

HON'BLE MR. JUSTICE VIBHU BAKHRU

HON'BLE MR. JUSTICE TEJAS KARIA

O R D E R %

04.07.2025 1. The petitioner has filed the present petition, inter alia, praying as under: “a) Allow the present Writ Petition and pass a Writ of Certiorari, Mandamus and/or any other appropriate Writ, direction or order quashing/setting aside the impugned Show Cause Notice dated 27.05.2025 issued by the Respondent under section 143(3) of the Act including any ongoing or subsequent assessment proceedings under the Act with respect to Assessment Year 2020-21 due to the lack of jurisdiction and expiry of period of limitation;

b) Grant ad interim stay of the said Impugned Show Cause Notice dated 27.05.2025 and proceedings initiated in consequence thereof with respect to Assessment Year 2020-21 pending the adjudication/disposal of the present Petition by this Hon’ble Court;” 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 08/07/2025 at 12:05:40

2.

Mr. Butani, the learned counsel appearing for the petitioner submits that the Draft Assessment Order passed under Section 144C(1) of the Income Tax Act, 1961 is not in conformity with the order passed by the Transfer Pricing Officer [TPO] in regard to the determination of the Arm’s Length Price [ALP] of the International transaction. He submits that the Assessing Officer does not have any jurisdiction to determine the ALP and must necessarily pass orders in conformity with the decision of the TPO. He submits that the Assessing Officer had issued a Show Cause Notice dated 27.05.2025, which is impugned in the present petition seeking to travel beyond the order passed by the TPO and proposing transfer pricing adjustments which were not in conformity with the order passed by the TPO. He submits that thereafter, the AO had proceeded to pass the draft assessment order. 3. Concededly, the petitioner has an equally efficacious remedy to agitate the issue before the Dispute Resolution Panel (DRP) or avail appellate remedies before the Commissioner of Income Tax (Appeals). 4. In view of the above, we do not consider it apposite to entertain this petition. 5. Mr. Butani submits that the petitioner is also aggrieved by the order passed by the TPO and therefore, he would be filing objections before the DRP. 6. In view of the above, we also consider it apposite to clarify that in the event the petitioner files its objections against the draft assessment order before the DRP, the DRP shall consider the same on merits inter alia bearing in mind the decision of this Court in M/s Giesecke and Devrient 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 08/07/2025 at 12:05:40

India Pvt. Ltd. v. Deputy Commissioner of Income Tax 2.1 & Ors.: Neutral Citation 2024: DHC: 2561-DB. 7. It is clarified that all rights and contentions of the petitioner are reserved. 8. The petition is disposed of with the aforesaid observations. Pending applications are also disposed of. 9. The next date of hearing fixed, that is, on 16.07.2025 stands cancelled.

VIBHU BAKHRU, J

TEJAS KARIA, J JULY 4, 2025 akc

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 08/07/2025 at 12:05:40

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