Loading High Court cases…
538 orders · Page 9 of 11
The Tribunal held that the contention of the Revenue regarding the timelines is fundamentally misconceived. A notice under Section 148 of the IT Act, accompanied by an order under Section 148A(d), must be issued within the time stipulated under Section 149 of the IT Act. Section 148A(d) governs the officer's compliance with the stipulations under Section 148A, aiming for transparency and benefit to assessees, but it does not extend the time limit prescribed under Section 149(1). The entire process under Section 148A(a) to (d) and the issuance of notice under Section 148 must be completed within the total time available under Section 149(1). A notice issued under Section 148 beyond the timeline stipulated in Section 149(1) is non-compliant and invalid. The Tribunal relied on the Delhi High Court's decision in Ram Balram Buildhome Pvt. Ltd. vs. Income Tax Officer & Anr., which considered the principles laid down in Ashish Agarwal and Rajeev Bansal, and concluded that the notice under Section 148 was time-barred. Consequently, the notice dated 29/07/2022 issued under Section 148 is quashed as it is beyond the time period specified under Section 149(1). The assessment order dated 29/05/2023, passed on the basis of this notice, is also quashed and set aside. Rule is made absolute.
The High Court, while not deciding the issues on merits, remanded the matters back to the Commissioner of Income Tax (Appeals) (CIT(A)) for fresh adjudication. The Court directed the CIT(A) to examine the transponder service agreements to determine factually whether the payments constitute 'royalty' under the domestic law or Article 12 of the India-USA Treaty. For payments made prior to the insertion of Explanation 6 by the Finance Act, 2012, the CIT(A) must follow the decision in Reliance Industries Limited, holding that retrospective amendments cannot fasten withholding tax liability if payments were made before the amendment. For payments made post-Finance Act, 2012, the CIT(A) is to examine the agreements and ascertain if the payments constitute 'royalty' under the domestic law or the Treaty, considering Section 90(2) of the Act. The Court clarified that if there is a final determination of no taxability in the hands of Intelsat Corporation, there would be no withholding tax liability. The Court explicitly stated it was not expressing any opinion on the merits or the applicability of Article 12(3) of the Treaty.
The High Court, while not deciding the issues on merits, remanded the matters back to the Commissioner of Income Tax (Appeals) (CIT(A)) for fresh adjudication. The Court directed the CIT(A) to examine the transponder service agreements to determine factually whether the payments constitute 'royalty' under the domestic law or Article 12 of the India-USA Treaty. For payments made prior to the insertion of Explanation 6 by the Finance Act, 2012, the CIT(A) must follow the decision in Reliance Industries Limited, holding that retrospective amendments cannot fasten withholding tax liability if payments were made before the amendment. For payments made post-Finance Act, 2012, the CIT(A) is to examine the agreements and ascertain if the payments constitute 'royalty' under the domestic law or the Treaty, considering Section 90(2) of the Act. The Court clarified that if there is a final determination of no taxability in the hands of Intelsat Corporation, there would be no withholding tax liability. The Court explicitly stated it was not expressing any opinion on the merits or the applicability of Article 12(3) of the Treaty.
The High Court, while admitting the appeals on substantial questions of law, did not adjudicate the issues on merits. Instead, the Court remanded the matters back to the Commissioner of Income Tax (Appeals) (CIT(A)) for fresh adjudication. The Court directed the CIT(A) to examine the transponder service agreements to determine the nature of services rendered and whether the payments constitute 'royalty' under the domestic law or Article 12 of the India-USA DTAA. For payments made prior to the insertion of Explanation 6 by the Finance Act, 2012, the CIT(A) was directed to follow the decision in *Reliance Industries Limited* and hold that no withholding tax liability can be imposed based on a retrospective amendment. For payments made post-Finance Act, 2012, the CIT(A) must ascertain if the payments constitute 'royalty' under the domestic law or the Treaty, considering Section 90(2) of the Act. The Court explicitly stated that it had not expressed any opinion on the merits and that all contentions would be open for the CIT(A) to adjudicate. The CIT(A) was requested to dispose of the appeals expeditiously, by December 31, 2025.
The High Court, while admitting the appeals on substantial questions of law, did not adjudicate the issues on merits. Instead, the Court remanded the matters back to the Commissioner of Income Tax (Appeals) (CIT(A)) for fresh adjudication. The Court directed the CIT(A) to examine the transponder service agreements to determine the nature of services rendered and whether the payments constitute 'royalty' under the domestic law or Article 12 of the India-USA DTAA. For payments made prior to the insertion of Explanation 6 by the Finance Act, 2012, the CIT(A) was directed to follow the decision in *Reliance Industries Limited* and hold that no withholding tax liability can be imposed based on a retrospective amendment. For payments made post-Finance Act, 2012, the CIT(A) must ascertain if the payments constitute 'royalty' under the domestic law or the Treaty, considering Section 90(2) of the Act. The Court explicitly stated that it had not expressed any opinion on the merits and that all contentions would be open for the CIT(A) to adjudicate. The CIT(A) was requested to dispose of the appeals expeditiously, by December 31, 2025.
The High Court, while not deciding the issues on merits, remanded the matters back to the Commissioner of Income Tax (Appeals) (CIT(A)) for fresh adjudication. The Court directed the CIT(A) to examine the transponder service agreements to determine factually whether the payments constitute 'royalty' under the domestic law or Article 12 of the India-USA Treaty. For payments made prior to the insertion of Explanation 6 by the Finance Act, 2012, the CIT(A) must follow the decision in Reliance Industries Limited, holding that retrospective amendments cannot fasten withholding tax liability if payments were made before the amendment. For payments made post-Finance Act, 2012, the CIT(A) is to examine the agreements and ascertain if the payments constitute 'royalty' under the domestic law or the Treaty, considering Section 90(2) of the Act. The Court clarified that if there is a final determination of no taxability in the hands of Intelsat Corporation, there would be no withholding tax liability. The Court explicitly stated it was not expressing any opinion on the merits or the applicability of Article 12(3) of the Treaty.
The Bombay High Court held that the communication dated November 29, 2018, cannot be treated as a statutory order or a final determination of the Petitioner's refund entitlement. While the Petitioner's claim letter of October 10, 2018, could be considered an application for refund, the subsequent communication from the ACIT did not conclusively determine the refund. The Court agreed with the Petitioner that it would not be appropriate to delve into the merits of the refund claim based on the India-Mauritius Tax Treaty, as this issue is pending before various forums. The Court quashed and set aside the impugned communication dated June 16, 2022. However, it declined to issue a writ of mandamus for the refund solely based on the November 29, 2018 communication, as it lacked the character of a final refund order. The Court directed the ACIT to pass a final speaking order on the refund claim within eight weeks, after providing the Petitioner an opportunity for a hearing. All contentions on merits were left open. If the refund is found admissible, interest would be granted from October 10, 2018.
The High Court allowed the appeal, quashing and setting aside the Tribunal's order. Regarding the first substantial question of law (disallowance of write-off of deposits and interest as business loss), the Court noted the assessee's submission that this issue was decided in its favour in its own case for a previous assessment year, and the revenue had accepted that decision. The Court found this submission to be valid and answered the question in favour of the assessee. Regarding the second substantial question of law (AO questioning correctness of P&L account for book profit computation), the Court, relying on Supreme Court judgments in Apollo Tyres Ltd. vs. Commissioner of Income-tax and Malayala Manorama Company Limited vs. Commissioner of Income-tax, held that Section 115J(1A) does not empower the AO to probe into accounts accepted by authorities under the Companies Act, except to the extent provided in the Explanation to Section 115J. The Court found that the AO does not have jurisdiction to go behind the net profit shown in the P&L account. Therefore, this question was also answered in favour of the assessee. The third substantial question of law concerning miscellaneous expenses was implicitly answered in favour of the assessee as the overall appeal was allowed and the Tribunal's order set aside.
The High Court dismissed the writ petition challenging the reassessment proceedings. The Court held that the reassessment proceedings initiated by the notice dated March 30, 2016, were valid. The reasoning was based on the analysis of various High Court judgments, which upheld reassessment proceedings initiated beyond the period of four years when based on subsequent tangible material that revealed the original disclosure to be incorrect or the transaction to be bogus. The Court found that the ratio of decisions like Indo European Breweries Limited vs. Income Tax Officer, Ambuj Foods (P.) Ltd. vs. Principal Commissioner of Income-tax, and others supported the revenue's stand. The Court clarified that it had not commented on the merits of the transaction itself, as the issue before it was solely the jurisdiction of the AO to reopen the case. All contentions on merits were kept open for adjudication during the reassessment proceedings. The interim relief granted to the petitioner was continued for four weeks from the date of the order.
The High Court held that the substantial question of law is answered in the affirmative and against the assessee. The Court noted that Clause 3 of the agreement stipulated payment of 5% of the total receipts of the assessee from advertising. The assessee's profit and loss account showed income of Rs. 63,43,480. The Assessing Officer correctly applied the agreement's terms to calculate the allowable expenditure as 5% of the receipts of Rs. 58,77,412. The Commissioner of Income Tax (Appeals) found 15% of receipts, Rs. 8,81,611, to be reasonable. The High Court found that the findings of fact by the Assessing Officer, Commissioner of Income Tax (Appeals), and the Tribunal regarding the income from advertisement (Rs. 63,43,480) were not perverse and did not warrant interference under Section 260A. The appeal was dismissed.
The High Court held that the Petitioner has a statutory remedy of appeal, which was communicated to them. The Court found the Petitioner's assertion of having no alternate or efficacious remedy to be false. The reasons provided by the Petitioner, such as the delay in appellate proceedings and the pre-deposit requirement for interim relief, were not considered justifiable grounds to bypass the statutory remedy. The Court emphasized that extraordinary jurisdiction cannot be invoked to avoid pre-deposit requirements or to circumvent statutory appeal mechanisms. Regarding the breach of natural justice, the Court noted that the allegations pertained to inadequate notice or opportunity, which would require factual investigation and did not present extraordinary circumstances to deviate from the rule of exhausting alternate remedies. The Court, relying on its previous decision in Oberoi Constructions Limited vs. Union of India, declined to entertain the petition, relegating the Petitioner to their alternate statutory remedy. All contentions of both parties were left open to be decided by the Appellate Authority.
The High Court held that the writ petition could be entertained despite the Petitioner having invoked the alternate statutory remedy of appeal. This was because the undisputed facts revealed a clear violation of the principles of natural justice and fair play, which constitutes a circumstance where the rule of exhaustion of alternate remedies can be departed from. The Court found that the Petitioner was issued a show cause notice with a deadline of March 30, 2022, at 23:59 hours, and filed a response at 17:59 hours on the same day. However, the reassessment order was passed at 17:22 hours, before the deadline and without considering the Petitioner's response. This non-consideration vitiated the order and violated natural justice. The Court relied on the reasoning in *Mateen Pyarali Dholakia vs. Union of India*. Consequently, the impugned reassessment order was set aside, and the matter was remitted back to the assessing officer for fresh consideration, including granting the Petitioner a personal hearing. This exercise was to be completed within three months. The Petitioner's statement regarding the withdrawal of the pending appeal and not raising limitation objections was accepted. All contentions on the merits of the reassessment were left open.
The High Court quashed and set aside the notice under Section 148 dated March 31, 2021, for the assessment year 2014-15. The Court found that the reasons recorded for re-opening did not contain any allegation of the assessee's failure to disclose fully and truly all material facts necessary for the assessment, which is a mandatory pre-condition under the first proviso to Section 147 when re-opening a case after four years. Additionally, the Court noted that the issues concerning the eligibility of interest under Section 80P and the disallowance under Section 40(a)(ia) for non-deduction of TDS were already investigated and addressed during the original assessment proceedings under Section 143(3). Therefore, any attempt to re-open the case on these grounds amounted to a change of opinion and a review of the earlier concluded assessment, which is not permissible under Section 147. The rule was made absolute, and the petition was disposed of.
The High Court held that the adjustment of the refund for AY 2014-15 against the demand for AY 2016-17 was unjustified and illegal. The Court noted that there was no dispute that the Petitioner had paid 20% of the demand for AY 2016-17 and that the appeal for that year was pending. The Court reiterated that as per CBDT Circulars, the balance demand should be stayed upon payment of 20% of the demand until the disposal of the appeal. The reasoning of the Respondent that the adjustment was justified because the balance demand was not paid was found to be erroneous and contrary to the Court's decision in Mahesh Ganatra (supra) and the CBDT Circular. The Court directed the Respondent to refund the erroneously adjusted amount within four weeks and also directed the Commissioner of Income Tax (Appeal) to dispose of the appeal for AY 2016-17 expeditiously within four months.
The High Court held that there was a clear violation of the principles of natural justice. The Court accepted the Revenue's submission that a bona fide error occurred in not granting the opportunity of hearing to the Petitioner. Consequently, the Court set aside the impugned assessment order dated 09.08.2022. The matter was remanded back to the Assessing Officer with a direction to carry out the assessment afresh after giving an opportunity of hearing to the Petitioner and also providing a draft assessment order. The Court stipulated that this exercise must be completed within three months of the order's upload, and the Petitioner agreed not to raise any limitation issues if this timeline was adhered to. All other contentions of the parties were left open.
The High Court held that the Tribunal erred in its decision. The Court agreed with the assessee's contention that Section 72A of the IT Act was not applicable to the facts of the case. The appellant's claim was not for carrying forward and setting off accumulated loss and unabsorbed depreciation of the amalgamating companies in the hands of the amalgamated company, but rather for the determination of the correct written down value (WDV) of the assets of the amalgamating companies that had vested in the appellant pursuant to the scheme of amalgamation. The Court found that the WDV of the assets at the hands of the amalgamated company should be the WDV at the hands of the amalgamating company for the immediately preceding previous year, arrived at after reducing the depreciation actually allowed. The Court agreed with the Commissioner of Income-tax (Appeals) that the unabsorbed depreciation of the amalgamating companies should be added to the WDV of the block of assets of the amalgamated company. The Court answered the substantial question of law in favour of the assessee and against the Revenue, quashing and setting aside the impugned order of the Tribunal and restoring the order of the Commissioner of Income-tax (Appeals).
The High Court set aside the orders passed by the CIT (Exemptions) in Writ Petition No. 11759/2024 and Writ Petition No. 11761/2019, as the delay in these cases, when correctly computed up to the filing of Form-10B, exceeded 365 days. Consequently, these applications should have been considered by the Chief Commissioner of Income Tax. The petitioners were granted four weeks to respond to the Chief Commissioner's communication dated October 30, 2023. The Chief Commissioner was directed to dispose of the application expeditiously within three months. For the remaining three writ petitions, where the admitted delays were significant (865, 1930, and 1245 days), the Court also set aside the orders of the Commissioner (Exemption) due to confusion regarding the competent authority. The appropriate authority was directed to consider and dispose of these applications within three months. All contentions on merits were left open.
The Bombay High Court held that the petitioners' calculation of delay by referring to the filing of Form-10BB was incorrect. The relevant form for claiming exemptions was Form-10B, and therefore, the delay should have been computed up to the filing of Form-10B. Consequently, for assessment years 2018-2019 and 2019-2020, the delay in filing Form-10B exceeded 365 days. This meant the CIT (Exemptions) was not the competent authority to condone the delay. The court set aside the orders passed by the CIT (Exemptions) in these cases. For WP 11759/2024 and WP 11761/2024, the petitioners were granted four weeks to respond to the Chief Commissioner of Income Tax's communication dated 30 October 2023. The Chief Commissioner was directed to dispose of the application for condonation of delay expeditiously within three months. For the remaining three writ petitions, where the delays were admitted to be significantly higher (865, 1930, and 1245 days), the court, noting confusion regarding the competent authority for earlier assessment years, directed the appropriate authority to consider and dispose of the applications for condonation of delay within three months. All contentions on merits were left open.
The High Court held that the Tribunal erred in estimating only 3% of the alleged purchases as bogus. The Court found a clear error of law in the Tribunal's approach, which contradicted several decisions, including Kanak Impex (Supra). The Court noted the Assessee's significant non-cooperation, inability to prove genuineness of purchases, failure to produce suppliers, books of accounts, or incidental expenses, and unserved summons to suppliers. These factors, similar to the facts in Kanak Impex, justified a full disallowance. The Court distinguished the Assessee's cited cases like Shree Ganesh Developers. Consequently, the Court reversed the orders of the CIT(A) and the Tribunal, restoring the addition made by the Assessing Officer. The questions of law were answered in favour of the Revenue.
The Bombay High Court held that the petitioners' calculation of delay by referring to the filing of Form-10BB was incorrect. The relevant form for claiming exemptions was Form-10B, and therefore, the delay should have been computed up to the filing of Form-10B. Consequently, for assessment years 2018-2019 and 2019-2020, the delay in filing Form-10B exceeded 365 days. This meant the CIT (Exemptions) was not the competent authority to condone the delay. The court set aside the orders passed by the CIT (Exemptions) in these cases. For WP 11759/2024 and WP 11761/2024, the petitioners were granted four weeks to respond to the Chief Commissioner of Income Tax's communication dated 30 October 2023. The Chief Commissioner was directed to dispose of the application for condonation of delay expeditiously within three months. For the remaining three writ petitions, where the delays were admitted to be significantly higher (865, 1930, and 1245 days), the court, noting confusion regarding the competent authority for earlier assessment years, directed the appropriate authority to consider and dispose of the applications for condonation of delay within three months. All contentions on merits were left open.
The Bombay High Court held that the petitioners had incorrectly computed the delay in filing Form-10B by calculating it up to the filing of Form-10BB, instead of the relevant Form-10B. This miscalculation meant that the delay in several cases, particularly for assessment years 2019-2020 and 2018-2019, exceeded 365 days. Consequently, the Commissioner of Income Tax (Exemptions) lacked the jurisdiction to condone such delays. The Court set aside the orders passed by the Commissioner (Exemptions) in these instances. For assessment years 2019-2020 and 2018-2019, the petitioners were granted four weeks to respond to the Chief Commissioner of Income Tax's communication dated 30 October 2023. The Chief Commissioner was directed to dispose of the applications expeditiously. For other assessment years where the competent authority was unclear, the Court set aside the Commissioner's orders and directed the appropriate authority to consider and dispose of the applications within three months. All contentions on merits were left open.
The High Court held that it would not be appropriate to entertain the Writ Petition when a statutory appeal against the impugned order dated 10.10.2023 was already pending. The Court reasoned that all contentions raised by the Petitioner, including the issue of non-compliance with the principles of natural justice, could be effectively considered and decided in the pending Appeal. Accordingly, the High Court disposed of the Writ Petition with liberty to the Petitioner to pursue the pending Appeal. The Appeal was directed to be disposed of expeditiously by 14.08.2025. The interim order that had restrained the Respondents from enforcing the impugned order was continued until the disposal of the Appeal. All contentions of all parties were explicitly left open for consideration in the Appeal.
The High Court held that the Tribunal erred in estimating only 3% of the alleged purchases as bogus. The Court found that the Assessee had failed to discharge its onus to prove the genuineness of the purchases, citing numerous instances of non-cooperation and inability to produce vital documentation. The Court relied on the decision in Pr. Commissioner of Income Tax-5 vs. Kanak Impex (India) ltd., where the disallowance of the whole of the purchases was confirmed. The Court distinguished the decisions relied upon by the Assessee, such as Shree Ganesh Developers. Consequently, the High Court reversed the orders of the CIT(A) and the Tribunal, restoring the addition made by the Assessing Officer, which was the peak of the bogus purchases. The substantial questions of law were answered in favour of the Revenue and against the Assessee. The operative direction is to restore the addition made in the assessment orders.
The High Court set aside the orders passed by the CIT (Exemptions) in Writ Petition No. 11759/2024 and Writ Petition No. 11761/2019, as the delay in these cases, when correctly computed up to the filing of Form-10B, exceeded 365 days. Consequently, these applications should have been considered by the Chief Commissioner of Income Tax. The petitioners were granted four weeks to respond to the Chief Commissioner's communication dated October 30, 2023. The Chief Commissioner was directed to dispose of the application expeditiously within three months. For the remaining three writ petitions, where the admitted delays were significant (865, 1930, and 1245 days), the Court also set aside the orders of the Commissioner (Exemption) due to confusion regarding the competent authority. The appropriate authority was directed to consider and dispose of these applications within three months. All contentions on merits were left open.
The High Court held that the substantial question of law is answered in the affirmative, meaning the Tribunal was justified in its findings. The Court noted that the scope of appeal under Section 260A is limited to interference with findings of fact only if they are perverse. The Assessing Officer had held that the beneficiaries voluntarily pooled their money in the trust with the knowledge that funds would be used for business projects, leading to profits, thus constituting an AOP. This finding was upheld by the CIT(A) and the ITAT. The ITAT had further observed that the assessee itself declared its status as an AOP and made no attempt to rectify this declaration or offer an explanation for it. The Court found that the orders of all authorities were based on meticulous appreciation of evidence and the findings of fact were not perverse. Consequently, the interest claim of Rs. 6,60,238/- to the beneficiaries was disallowed. The appeal was dismissed.
The High Court held that the substantial question of law is answered in the affirmative, dismissing the appeal. The Court noted that the Assessing Officer, applying the criteria from CIT v. Indira Balkrishna, found that the beneficiaries voluntarily pooled their money in the trust with the knowledge that funds would be used for business projects, leading to profits for the trust and beneficiaries. This led to the disallowance of interest under Section 40(b). The Tribunal had further observed that the assessee itself declared its status as an AOP, and no attempt was made to rectify this declaration or offer an explanation for it. The Court found that the orders of the lower authorities were based on meticulous appreciation of evidence and the findings of fact were not perverse. Therefore, the appeal failed.
The High Court held that the substantial question of law is answered in the affirmative, meaning the Tribunal was justified in its findings. The Court noted that the Assessing Officer applied the criteria from CIT v. Indira Balkrishna, finding that beneficiaries voluntarily pooled funds for business with knowledge of profit generation, thus forming an AOP. This led to the disallowance of interest under Section 40(b). The ITAT had upheld this, noting that the assessee itself declared its status as an AOP and made no attempt to rectify this declaration or offer an explanation for it. The Court found that the orders of the Assessing Officer, CIT(A), and ITAT were based on meticulous appreciation of evidence and the findings of fact were not perverse. Therefore, the appeal was dismissed.
The High Court held that the substantial question of law is answered in the affirmative, dismissing the appeal. The Court noted that the Assessing Officer, applying the criteria from CIT v. Indira Balkrishna, found that the beneficiaries voluntarily pooled their money in the trust with the knowledge that funds would be used for business projects, resulting in profits for the trust and beneficiaries. Consequently, the trust was held to be an AOP, and the interest claim of Rs.14,38,740/- to beneficiaries was disallowed under Section 40(b). The ITAT had further observed that the assessee itself declared its status as an AOP in its return, and no attempt was made to rectify this declaration or offer an explanation for it. The Court found that the orders of the lower authorities were based on meticulous appreciation of evidence and that the findings of fact were not perverse. Therefore, the appeal was dismissed.
The High Court held that the substantial question of law is answered in the affirmative, leading to the dismissal of the appeal. The Court noted that the scope of appeal under Section 260A is limited to interfering with findings of fact only if they are perverse. The AO had applied the criteria from CIT v. Indira Balkrishna, concluding that the beneficiaries voluntarily pooled their money in the trust with the knowledge that funds would be utilized for business projects, resulting in profits for the trust and beneficiaries. This led to the disallowance of interest under Section 40(b). The ITAT had further observed that the assessee itself declared its status as an AOP, and no attempt was made to rectify this declaration or offer an explanation. The Court found that the orders of the lower authorities were based on meticulous appreciation of evidence and the findings of fact were not perverse. Therefore, the appeal was dismissed.
The High Court held that the substantial question of law is answered in the affirmative, leading to the dismissal of the appeal. The Court noted that the scope of appeal under Section 260A is limited to interfering with findings of fact only if they are perverse. The Assessing Officer, applying the criteria from CIT v. Indira Balkrishna, found that the beneficiaries voluntarily pooled their money in the trust with the knowledge that funds would be used for business projects, resulting in profits for the trust and beneficiaries. This led to the conclusion that the trust was an Association of Persons, justifying the disallowance of interest under Section 40(b). The ITAT had further observed that the assessee itself declared its status as an AOP and made no attempt to rectify this declaration or offer an explanation for it. The Court found that the orders of the lower authorities were based on meticulous appreciation of evidence and were not perverse. Therefore, the appeal failed.
The High Court granted the applicant-petitioner permission to travel from Mumbai to Dubai, UAE, between April 4, 2025, and June 10, 2025, subject to several conditions. These conditions include filing an undertaking with a detailed itinerary, hotel addresses, contact details, and a commitment to return by June 11, 2025. He must also undertake not to seek renewal of the order until his return and to return within 96 hours if the Income Tax Department requires his presence. A further undertaking requires him to file an affidavit within one week of his return, detailing business meetings, expenses, and income sources for the trip. The Look Out Circular issued at the instance of the respondent-Income Tax Department was suspended until June 11, 2025. The court directed immigration authorities to permit the applicant's passage irrespective of notifications. The matter was listed for reporting compliance on June 16, 2025.
The High Court held that since the refunds have now been made, the issue of interest is best adjudicated by the Third Respondent (presumably an Income Tax authority) in terms of Section 244A(2) of the Income Tax Act, 1961. The Third Respondent is to decide whether any delay in disbursing the refund was attributable to the petitioner. The petitioner was granted liberty to represent their case to the Third Respondent within three weeks of the order's uploading, providing all necessary details. The Third Respondent must then hear the petitioner and decide the matter in accordance with the law within four weeks, communicating a reasoned decision. The court kept all contentions of both parties open and granted liberty to challenge the Third Respondent's decision if aggrieved. The petition was disposed of in these terms.
The High Court held that the reassessment proceedings were vitiated because the Assessing Officer (AO) acted on borrowed satisfaction and under dictation from his superiors, rather than forming his own independent reason to believe that income had escaped assessment. The Court noted that while the reassessment was initiated within four years, the crucial precondition for reopening under Section 147 is the AO's own "reason to believe." The judgment emphasized that the AO cannot act merely on the dictates of another person or authority, citing Supreme Court and various High Court precedents like Anirudhsinhji K Jadeja, Sodexo India Services, and Balaji Mines and Minerals. The Court clarified that the AO is bound by the TPO's determination only when a reference is made under Section 92CA(1) during pending assessment proceedings, not by a determination for a subsequent year. The ITAT's finding that the AO had not independently applied his mind and had acted under dictation was found to be correct. Therefore, the substantial question of law was answered against the revenue. The appeal was dismissed.
The High Court declined to entertain the writ petition and relegated the Petitioner to avail of the alternate remedy under Section 264 of the Income Tax Act. The Court acknowledged that the Petitioner's contentions regarding the Rs.6.15 crores gross receipts and the nature of write-backs, supported by ICAI Guidance Notes and Gujarat High Court decisions, had prima facie merit. However, it held that a deeper scrutiny of the returns, profit and loss accounts, and other accompanying documents, including the interpretation of the ICAI guidance note in the context of Section 44AB, would be required. The Court found that the Commissioner exercising revisional jurisdiction under Section 264 could more conveniently undertake such an exercise. Citing precedents on the exhaustion of alternate remedies, the Court concluded that this case did not fall within the exceptions warranting bypassing the statutory remedy. The Petitioner was directed to file the revision within four weeks, and the Revisional Authority was directed to dispose of it expeditiously, within three months, after giving a hearing and passing a reasoned order on merits.
The High Court held that sufficient cause was shown for the condonation of delay in filing Form-10. The Court considered the peculiar facts, including the Petitioner being a small charitable trust engaged in educational scholarships, the challenges faced during the COVID-19 pandemic which had just ended, and the Petitioner's past diligence in filing necessary forms. The Court noted the absence of malafides and that the Petitioner had not gained any undue advantage from the delay. The fact that the return was filed within the prescribed period, and the delay occurred only in filing Form-10 after the lacuna was pointed out, was also considered. The Court acknowledged the Petitioner's lack of professional assistance. Therefore, the impugned communication/order dated August 8, 2024, was set aside, and the Petitioner's application for condonation of delay was allowed. The Petitioner was permitted to file consequential applications. The rule was made absolute without costs.
The High Court held that the impugned notice under Section 148 of the Income Tax Act, 1961, and the order rejecting objections were liable to be quashed and set aside. The Court found that the assessee had made full disclosures during the original assessment proceedings, and there was no failure to disclose material facts. The reopening was based on a change of opinion, as the issue of expenses was already considered. The Court noted that CBDT Circular No. 5 of 2012 was not applicable to AY 2008-2009, as it pertained to expenses incurred after December 14, 2009. The Court followed the decision in Abbott India Ltd. vs. Assistant Commissioner of Income-tax, which quashed reassessment proceedings for the same AY on similar grounds. The Court also distinguished the revenue's reliance on Kap Scan and Diagnostic Centre (P.) Ltd., stating it dealt with the merits of allowability of expenses, not the jurisdictional conditions for reopening, and was for a different assessment year. The Court found no obligation for the assessee to disclose that sales promotion expenses were incurred on doctors during the original assessment.
The High Court quashed and set aside the impugned notice dated March 29, 2016, under Section 148 of the Income-tax Act, 1961. The Court found that the reopening was initiated more than four years after the end of the relevant assessment year, thus requiring a failure on the part of the petitioner to disclose fully and truly all material facts necessary for the assessment, as per the first proviso to Section 147. The Court noted that the reasons recorded for reopening admitted that the issue of promotional expenses was examined during the original assessment, and one-third of such expenses were disallowed. The Court held that if there was any failure, it was on the part of the Assessing Officer in not disallowing the entire expenditure, not on the part of the petitioner. Therefore, the precondition of failure to disclose material facts was not satisfied. Furthermore, the Court observed that the petitioner had provided detailed submissions regarding the promotional expenses and the applicability of CBDT Circular No. 5 of 2012 during the original assessment proceedings, and the AO had made an ad-hoc disallowance after considering these submissions. The Court concluded that permitting reassessment proceedings in this scenario would amount to a change of opinion and a review of the assessment order, which is not permissible under Section 147. The Court also noted that the issue had been concluded by the CIT(A) before the initiation of the impugned proceedings, making the proceedings without jurisdiction due to the third proviso to Section 147. The Court made no finding on other submissions made by the petitioner.
The Bombay High Court held that the issues raised by the petitioner, including the validity of the Section 153C notices, the provision of a satisfaction note, the existence of incriminating material, and the computation of the limitation period, involve mixed questions of law and fact. The Court declined to exercise its discretionary writ jurisdiction under Article 226 of the Constitution of India to delve into these factual investigations. The Court reasoned that such factual correlation and examination of documents with assessment years, as well as the precise determination of the limitation period under Section 153B(1)(ii) (which requires ascertaining the last date of authorization for search), are best undertaken by the authorities under the Income-tax Act. The Court observed that it cannot be converted into an assessing officer. The petitioner was relegated to raise all these issues before the appropriate authorities during the assessment proceedings or in appeal if dissatisfied with the assessment order. The Court found no infirmity in the rejection of further objections by the assessing officer, stating that there must be an end to repeated objections. The petitions were dismissed.
The High Court dismissed all the writ petitions. Regarding the validity of the notices and the co-relation of documents, the Court held that examining the co-relation of documents with the assessment years is a factual investigation that cannot be undertaken by the High Court while exercising its extraordinary writ jurisdiction under Article 226. This factual co-relation must be done by the authorities under the Act, making the alternate remedy more appropriate. Concerning the time-bar issue, the Court noted that determining the limitation period under Section 153B(1)(ii) requires ascertaining the last date of authorization for the search, which was not provided by the petitioner. The Court also observed conflicting decisions on this issue based on case facts. Therefore, it was deemed appropriate for the authorities to adjudicate this issue. The Court emphasized that it would be premature to presume the assessment order would be against the petitioner and that the writ jurisdiction should not be exercised to prevent the assessing officer from proceeding with the assessment, especially in cases involving detected huge unaccounted income. The Court declined to exercise its discretionary jurisdiction by entering the arena of factual investigation, relegating the petitioner to raise all issues before the authorities under the Act.
The High Court held that the issues raised by the petitioner, including the validity of the Section 153C notices, the existence of incriminating material, the provision of the satisfaction note, and the correlation of documents with assessment years, require factual investigation. The Court stated that it would not undertake such factual inquiries while exercising its discretionary writ jurisdiction under Article 226 of the Constitution. Regarding the limitation issue under Section 153B(1)(ii), the Court noted that determining the last date of authorization for the search and the date of handing over documents would require factual ascertainment, which is best left to the authorities under the Act. The Court also observed that there are conflicting decisions on the limitation issue based on case facts. Therefore, the Court concluded that it was premature to presume the assessment order would be against the petitioner and that the petitioner should pursue their remedies before the Income Tax authorities. The petitions were dismissed, relegating the petitioner to raise all issues before the assessing officer and in appeal proceedings if necessary.
The Bombay High Court dismissed all the writ petitions. The Court held that the issues raised by the petitioner, such as the co-relation of documents with assessment years and the computation of the limitation period, required factual investigation. The Court stated that such factual co-relation and investigation cannot be undertaken by the High Court while exercising its discretionary writ jurisdiction under Article 226 of the Constitution. The Court emphasized that these matters are best adjudicated by the authorities under the Income-tax Act. Regarding the limitation period, the Court noted that it is a mixed question of law and fact and that the petitioner had not provided the date of the last authorization for the search, making it inappropriate for the Court to examine the issue. The Court also observed that there are conflicting decisions on the limitation issue based on case facts. The Court concluded that it would be premature to presume the assessment order would be against the petitioner and that preventing the assessing officer from proceeding with the assessment in cases involving detected unaccounted income would be inappropriate. The petitioner was relegated to raise all issues before the authorities under the Act.
The Bombay High Court dismissed all the writ petitions. Regarding the validity of the notices and the co-relation of documents, the Court held that examining the co-relation of documents with specific assessment years is a factual investigation that cannot be undertaken by the High Court while exercising its extraordinary writ jurisdiction under Article 226. This requires an examination by the authorities under the Act, making the alternate remedy more appropriate. Concerning the issue of limitation, the Court noted that it is a mixed question of law and fact. It observed that the petitioner had not provided the date of the last authorization for the search, which is crucial for determining the limitation period under Section 153B(1)(ii). Therefore, the Court deemed it inappropriate to examine the limitation issue and directed that it should be adjudicated by the authorities under the Act. The Court also stated that it would be premature to presume the assessment order would be against the petitioner and that the proceedings should not be intricated at this stage, especially in cases involving search and seizure of large unaccounted income. The petitioner was relegated to raise all issues before the authorities under the Act.
The High Court held that the rate of commission to be adopted is a pure question of fact. For credits identified by the assessee, the rate of commission should be taken at 0.15%, as adopted by the Tribunal. The Court answered question (a) in favour of the Revenue and against the assessee, and question (b) against the Revenue and in favour of the assessee. Consequently, the Tribunal's order was reversed, and the CIT(A)'s order dated 4 October 2012 was restored, subject to retaining the commission rate at 0.15%. The Court also issued directions for investigation into the assessee's activities by various authorities, including the Institute of Chartered Accountants of India, police, Enforcement Directorate, and the Chief Commissioner of Income-tax, due to admissions of fraud and money laundering. The Court noted that the argument on the tax regime being untenable was found so, but investigations were necessary due to serious economic crimes.
The High Court held that the issues raised by the petitioner, including the validity of the satisfaction note, the existence of incriminating material, and the computation of the limitation period, are mixed questions of law and fact that require detailed factual investigation. The Court declined to exercise its extraordinary writ jurisdiction under Article 226 of the Constitution of India to delve into these factual matrixes. The Court noted that the question of limitation under Section 153B(1)(ii) requires ascertaining the last date of authorization for the search, which was not provided by the petitioner. The Court also observed that the correlation of documents with assessment years is a factual exercise that cannot be undertaken by the High Court. Therefore, the petitioner was relegated to raise all these issues before the appropriate authorities under the Income-tax Act, 1961, and specifically in appeal proceedings if dissatisfied with the assessment order. The Court found no infirmity in the rejection of further objections, stating that there must be an end to repeated objections. The petitions were dismissed as premature, with the observation that if the Assessing Officer is convinced on merits, no prejudice would be caused to the petitioner.
The High Court dismissed all the writ petitions. Regarding the issue of the satisfaction note and incriminating material, the Court held that examining the correlation of documents with the assessment years and determining if incriminating material was found requires factual investigation. Such detailed factual analysis cannot be undertaken by the High Court while exercising its extraordinary writ jurisdiction under Article 226 of the Constitution. The Court stated that this is a matter best left for adjudication by the authorities under the Act. Concerning the issue of limitation, the Court found it to be a mixed question of law and fact. To ascertain the limitation period under Section 153B(1)(ii), it would be necessary to determine the last date of authorization for the search in the case of the searched party, which was not provided by the petitioner. The Court concluded that it would not be appropriate to examine the limitation issue and that the authorities under the Act should adjudicate this. The Court also observed that there are conflicting decisions on the issue of limitation based on the facts of each case. The Court reiterated that it would not exercise its discretionary jurisdiction to interfere at this stage, as it would prevent the AO from investigating cases involving significant unaccounted income. The petitioner was relegated to raise all issues before the authorities under the Act.
The High Court dismissed all the writ petitions. Regarding the validity of the Section 153C notices and the satisfaction note, the Court held that these issues required factual investigation, such as examining documents and their co-relation with specific assessment years. The Court opined that such detailed factual inquiry could not be undertaken by the High Court while exercising its extraordinary writ jurisdiction under Article 226 of the Constitution. It stated that the Assessing Officer is the appropriate authority to conduct this investigation. Therefore, the Court relegated the petitioner to pursue their objections through the available alternate remedies under the Act. Concerning the issue of limitation, the Court noted that it was a mixed question of law and fact. It observed that to determine the limitation period under Section 153B(1)(ii), it would be necessary to ascertain the last date of authorization for the search in the Alankit Group's case, which was not provided by the petitioner. The Court also noted conflicting decisions on this issue based on case facts. Consequently, the Court held that it was not appropriate to examine the limitation issue in the writ proceedings and that the authorities under the Act should adjudicate this matter. The Court also stated that the petitioner would not be precluded from raising the plea of limitation in appeal proceedings if dissatisfied with the assessment order. The Court found no infirmity in the rejection of further objections, stating that there must be an end to the filing of objections. The Court concluded that it would be premature to presume the assessment order would be against the petitioner and that preventing the Assessing Officer from proceeding would prejudice the investigation into alleged huge unaccounted income.
The High Court held that the revenue could not avoid or delay the refunds due to the petitioners, especially since the time limit for passing orders giving effect to the ITAT's order had expired. The court found the department's explanations regarding restructuring and lost records to be vague and insufficient to absolve them of responsibility. The court directed the Principal Commissioner of Income Tax, Pune, to ensure appropriate orders on refunds were passed by 15th April 2025, with refunds to be paid to the petitioners by 30th April 2025. If there was a delay, the refund amounts would carry interest at 6% per annum, and this interest component was to be recovered from the officers responsible for the delay. The court emphasized that the public exchequer and taxpayers should not bear the burden of departmental inaction. The petitions were disposed of with a direction for a compliance report.
The High Court held that the issues raised by the petitioner, including the validity of the Section 153C notices and the question of limitation, involve a mixed question of law and fact requiring factual investigation. The Court declined to exercise its discretionary writ jurisdiction under Article 226 of the Constitution of India, stating that it cannot be converted into an Assessing Officer to conduct such investigations. The Court found no infirmity in the rejection of further objections, as there must be an end to repeated objections. Regarding the time-bar issue, the Court noted that determining the limitation period under Section 153B(1)(ii) requires ascertaining the last date of authorization for the search, which was not provided. The Court concluded that these matters are best adjudicated by the authorities under the Act. The petitioner was relegated to raise all issues before the appropriate authorities and in appeal proceedings if dissatisfied with the assessment order. The petitions were dismissed.