PR. COMMISSIONER OF INCOME TAX vs. ASHTECH INDUSTRIES PVT. LTD.

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ITA/59/2023HC DelhiDLHC01000009201931 January 2023Bench: HON'BLE MR. JUSTICE RAJIV SHAKDHER,HON'BLE MS. JUSTICE TARA VITASTA GANJU2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the appeal cannot be sustained. The Court noted that the SFIO order in the present case is dated 31.03.2016, while the notice for reopening the assessment was issued prior to it, on 28.03.2016. The Court found that the same rationale applied as in the coordinate bench order cited by the Revenue (ITA No. 113/2021), where a similar plea was rejected. In that case, the SFIO's report was dated 31.03.2016, and the assessment order was dated 16.03.2016. The Court concluded that the reopening notice being issued before the SFIO order rendered the appeal unsustainable. Consequently, the appeal was closed, and the accompanying applications were rendered inefficacious.

What were the facts?

The appeal by the Principal Commissioner of Income Tax (Revenue) is against an order dated 20.12.2018 passed by the Income Tax Appellate Tribunal (Tribunal). The assessment year in question is 2009-2010. The proceedings were initiated under Section 147/148 of the Income Tax Act, 1961, based on information from the Deputy Commissioner of Income Tax. The tax effect in this appeal is Rs 62,88,150/-. The Revenue contended that parallel investigations by the SFIO made the appeal maintainable despite the tax effect being below the prescribed threshold, citing para 10(e) of the circular dated 20.08.2018. However, the Revenue also placed before the Court a coordinate bench order in ITA No. 113/2021 (Pr. Commissioner of Income Tax-7 v. M/S Rajdhani Realcon P. Ltd.) where a similar plea was rejected.

What were the issues?

1. Whether the appeal filed by the Revenue is maintainable despite the tax effect being below the prescribed monetary threshold, considering parallel investigations by the SFIO and the circular dated 20.08.2018 (para 10(e))? Assessee's Contention: Not recorded. Revenue's Contention: The appeal is maintainable because parallel investigations are being carried out by the SFIO, which brings it within the exception provided in para 10(e) of the circular dated 20.08.2018, even though the tax effect is below the prescribed threshold. The Revenue relied on the circular dated 20.08.2018.

Which sections of the Income-tax Act were involved?

Section 147,Section 148

AI-generated summary — verify with the full judgment below

$~25 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA 59/2023 & CM Appls.4376-77/2023

PR. COMMISSIONER OF INCOME TAX ..... Appellant Through: Mr Zoheb Hossain & Mr Vipul Agrawal, Sr. Standing Counsel with Mr Parth Semwal, Advs.

versus

ASHTECH INDUSTRIES PVT. LTD.

..... Respondent

Through: Mr Kapil Goel, Adv.

CORAM:

HON'BLE MR JUSTICE RAJIV SHAKDHER

HON'BLE MS JUSTICE TARA VITASTA GANJU

O R D E R %

31.01.2023 [Physical Hearing/Hybrid Hearing (as per request)] 1. This appeal is directed against the order dated 20.12.2018 passed by the Income Tax Appellate Tribunal [in short “Tribunal”]. 1.1 This appeal concerns Assessment Year (AY) 2009-2010. 2. This order was passed, after proceedings under Section 147/148 of the Income Tax Act, 1961 [in short “Act”] were initiated, based on inputs received from the Deputy Commissioner of Income Tax (DCIT). 2.1 The admitted position is, that the tax effect in the present appeal is Rs 62,88,150/-. 3. Mr Zoheb Hossain, who appears on behalf of the appellant/revenue, says that parallelly, investigations are being carried out by the SFIO, and therefore, the instant appeal will be maintainable, despite the tax impact being below the prescribed threshold in view of para 10(e) of the circular dated 20.08.2018. ITA 59/2023

page 1 of 2 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 29/05/2026 at 16:18:20

3.1 Mr Hossain, however, has placed before us, fairly, an order of the coordinate bench dated 04.05.2022 passed in ITA No. 113/2021 titled Pr. Commissioner of Income Tax-7 v. M/S Rajdhani Realcon P. Ltd. wherein a similar plea taken on behalf of the appellant/revenue was rejected. In that case, the SFIO’s report is dated 31.03.2016, while the assessment order is dated 16.03.2016. 3.2 In this case, it is noticed, that the SFIO order is dated 31.03.2016, while the notice for reopening assessment was issued prior in point of time i.e., on 28.03.2016. 4. In our view, the same rationale would apply, and therefore, this appeal cannot be sustained. 4.1 The appeal is, accordingly, closed. 5. Consequently, the accompanying applications are rendered inefficacious. Accordingly, the same are closed.

RAJIV SHAKDHER, J

TARA VITASTA GANJU, J

JANUARY 31, 2023/r

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ITA 59/2023

page 2 of 2 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 29/05/2026 at 16:18:20

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