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585 orders · Page 9 of 12
The High Court held that the impugned Notice issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2015-16 is time-barred. This decision is based on the concession made by the learned Additional Solicitor General before the Hon'ble Supreme Court in the case of *Union of India and Ors. v. Rajeev Bansal*. The Supreme Court's order dated 4th May 2026 explicitly stated that if a matter pertains to AY 2015-16, no further adjudicatory exercise is required by the High Court, other than declaring the Notice as time-barred. Since it is an admitted fact that the Notice was issued on or after 1st April 2021 and pertains to AY 2015-16, the Notice is consequently set aside. Any action taken or emanating from the said Notice is also quashed. The Rule is made absolute, and the Writ Petition is disposed of accordingly.
The High Court held that the matter pertains to Assessment Year 2015-16 and that the impugned notice issued under Section 148 is clearly time-barred. This conclusion is based on the concession made by the learned Additional Solicitor General before the Supreme Court in the case of Union of India & Ors. v. Rajeev Bansal. The Supreme Court's order dated 4th May 2026 explicitly stated that if a matter pertains to AY 2015-16, no further adjudicatory exercise is required by the High Court, except to declare the notices as time-barred. Consequently, the Writ Petition was allowed, and the impugned Notice under Section 148 was set aside. Any action taken or emanating from the said notice was also quashed. The rule was made absolute, and the Writ Petition was disposed of accordingly, with no order as to costs.
The High Court held that the impugned Notice issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2015-16 is clearly time-barred. This decision is based on the concession made by the learned Additional Solicitor General before the Hon'ble Supreme Court in the case of Union of India Vs. Rajeev Bansal. The Court noted that it is an admitted fact that the Notice was issued on or after April 1, 2021, and pertains to Assessment Year 2015-16. Following the Supreme Court's direction that if a matter pertains to AY 2015-16, no further adjudicatory exercise is required except to declare the notice as time-barred, the Court made the Rule absolute. Consequently, the Writ Petition was allowed, and the impugned Notice, along with any action taken or emanating from it, was quashed and set aside. The Court did not leave any issue undecided.
The High Court held that the Writ Petition stands revived. It found that the impugned Notice under Section 148 was issued on or after April 1, 2021, and pertains to Assessment Year 2015-16. Following the concession made by the learned Additional Solicitor General before the Supreme Court in the case of Union of India Vs. Rajeev Bansal, the Court held that the Notice is clearly time-barred. Consequently, the Writ Petition was allowed, and the impugned Notice issued under Section 148 was set aside. Any action taken or emanating from the said Notice was also quashed and set aside. The Rule was made absolute, and the Writ Petition was disposed of accordingly. No issue was expressly left undecided.
The High Court held that the impugned Notice issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2015-16 is time-barred. This finding is based on the admitted fact that the notice was issued on or after April 1, 2021, and pertains to AY 2015-16. The Court relied on the concession made by the learned Additional Solicitor General before the Supreme Court in the case of Union of India & Ors. v. Rajeev Bansal, which stipulated that reassessment notices for AY 2015-16 would be time-barred. Consequently, no further adjudicatory exercise was required by the High Court, other than to declare the notice as time-barred. The Writ Petition was allowed, and the impugned Notice, along with any consequential actions, was set aside. The rule was made absolute, and the Writ Petition was disposed of accordingly, with no order as to costs.
The High Court noted that the parties had informed the Court that the order dated 15th June 2026, read with the order dated 27th July 2026, had been duly complied with. Given that the Writ Petition had already been disposed of by the earlier order directing the payment of interest under Section 244A, and compliance had now been reported, no further orders were deemed necessary. The Court acknowledged the compliance and closed the matter. The specific calculation of interest or the exact amount in dispute was not re-examined as the focus was on compliance with the prior directive.
The High Court held that no substantial question of law arises in the appeal. This decision was based on the prior judgment of the same High Court in CIT V/s. Kolhapur Zilla Sahakari Dudh Utpadak Sangh Ltd., which dealt with the assessee's own case for assessment years 2007-08 and 2008-09. Crucially, this High Court decision was affirmed by the Hon'ble Supreme Court in Commissioner of Income Tax (Central) Vs. Kolhapur Zilla Sahakari Dudh Utpadak Sangh Ltd. The Supreme Court had held that the amount paid to milk suppliers, which included non-members, could not be considered profit. Therefore, following these binding precedents, the High Court found no merit in the department's appeal.
The High Court allowed the petition and quashed the criminal proceedings. The Court held that the prosecution could not be sustained because the entire TDS amount along with interest had been paid before the Show Cause Notice was issued. The Court considered the CBDT Circular dated April 24, 2008, which suggests that criminal prosecution need not be launched where the tax has been deposited. The Court noted that the Show Cause Notice was issued approximately 40 months after the payment of delayed TDS and interest, which was contrary to the circular's preference for launching prosecution within 60 days of detection. The explanation for the delay, though rejected by the revenue as an afterthought, was considered a reasonable cause by the Court, indicating no intention to avoid or evade TDS payment. Furthermore, the Court found that the revenue authorities failed to substantiate the specific roles of the petitioners (directors) in the commission of the offence under Section 276B to make them liable under Section 278B, as no notice under Section 2(35)(b) was issued to any petitioner treating them as a principal officer. The Court invoked its inherent powers under Section 482 of the CrPC to prevent abuse of process and secure the ends of justice.
The High Court held that the petition is allowed and the impugned order is set aside. The complaint filed by the respondent No.1 is dismissed. The Court reasoned that, as held in Unique Trading Company & Ors. vs. Income Tax Officer & Ors., Section 276C(2) does not indicate that mere failure to pay tax falls within its ambit; there must be a willful attempt to evade tax. The Court noted that it is a well-settled rule of construction for penal statutes to lean towards an interpretation that exempts the subject from penalty if two reasonable constructions are possible. In this case, the entire amount of tax was paid before the filing of the complaint. The petitioner had also pointed out circumstances in his explanation to the show cause notice that led to the default. Therefore, the mere failure to pay the tax was not sufficient to constitute the offense, and the order impugned could not be sustained.
The High Court clarified its earlier order dated 27.04.2026. The Court held that if the petitioner were to succeed in the writ petition, based on the challenge raised therein, the notice issued under Section 148 of the Income Tax Act would be rendered without jurisdiction. Consequently, the consequential assessment proceedings would not be allowed to be sustained. This clarification was made by deleting the previously recorded lines concerning the respondent's liberty to choose whether to proceed with faceless assessment and substituting them with the statement that the notice under Section 148 would be without jurisdiction, invalidating the assessment proceedings. The application was disposed of in terms of this clarification.
The High Court held that the ITAT was justified in setting aside the order of the CIT (Exemptions). The Court found that the AO had conducted necessary inquiries regarding the utilization of Rs. 6 crores of accumulated income and accepted the assessee's explanation as a possible view. The CIT's satisfaction was not shown to be erroneous. The Court distinguished the present case from Sesa Starlite Ltd. (supra) by noting that the AO had raised specific queries and received replies from the assessee before passing the assessment order, indicating application of mind. The reliance on Malabar Industrial Co. Ltd. (supra) was also deemed not applicable as the AO had made an enquiry and taken a view, which even if not agreed with by the CIT, did not warrant revision under Section 263. The Court concluded that the ITAT rightly held that the CIT erred in exercising jurisdiction under Section 263. The appeal was dismissed as it did not give rise to any substantial questions of law.
The High Court decided to clarify its previous order dated April 27, 2026. The Court found that the initial recording, stating that Respondent No. 3 would have to be considered at liberty to choose whether to proceed with the Faceless Assessment if the Petitioner were to succeed, was not accurate in reflecting the consequences of the petitioner's potential success. Instead, the Court clarified that if the Petitioner were to succeed in the petition based on the challenge raised therein, then the notice under Section 148 itself would be rendered without jurisdiction. Consequently, the consequential assessment proceedings would not be allowed to be sustained. This clarification was to be read as forming part of the original order after deleting the previously recorded lines. The application was disposed of in these terms.
The High Court held that the ITAT's order was not perverse or infirm and no substantial question of law arose. The ITAT correctly reversed the CIT(Appeals) order and held the reassessment proceedings invalid. The reasoning was that the AO had not established the assessee's failure to disclose truly and fully the material facts necessary for the original assessment. All facts regarding the sale of development rights and investments in FDRs were produced and deliberated upon during the original assessment proceedings, leading to an informed opinion by the AO. The subsequent notice under Section 148, based on a reappraisal of the same material, constituted a clear case of change of opinion. The ITAT rightly found no failure on the assessee's part to disclose material facts. The decision in Yuvraj v. Union of India was distinguished as factually different, lacking application of mind, unlike the present case which involved thoughtful consideration of facts and evidence. The ITAT declined to decide other issues as the primary ground of invalid reassessment was decided in favour of the assessee. The appeals were dismissed at the admission stage.
The High Court of Bombay at Goa held that the withdrawal of the notice under Section 148 of the Income Tax Act, 1961, by the Revenue had rendered the subject matter of the writ petition infructuous. Consequently, the learned Advocate for the petitioner, on instructions, sought to withdraw the petition. The Court accepted this request. The ratio of the decision is that when the action challenged in a writ petition becomes infructuous due to subsequent actions by the respondent, the petitioner is entitled to withdraw the petition. The operative direction was that the Writ Petition stands disposed of as withdrawn.
The High Court noted a cleavage of opinion between different Division Benches of the Bombay High Court regarding the nature of DDT and its applicability to DTAA provisions. Specifically, the decision in M/s. Colorcon Asia Pvt. Ltd. was contrasted with the decisions in Godrej & Boyce Mfg. Co. Ltd. (confirmed by the Supreme Court) and Small Industries Development Bank of India. The Court found substance in the revenue's argument that the Colorcon Asia Pvt. Ltd. decision overlooked the Supreme Court's interpretation in Godrej & Boyce Mfg. Co. Ltd. and the reasoning in Small Industries Development Bank of India, which held that Section 115-O is a tax on the company's profits, not on the dividend income in the shareholder's hands. Consequently, the Court held that the questions of law raised require determination by a Larger Bench. The appeals were not decided on merits but were referred to the Chief Justice for constitution of a Larger Bench.
The High Court noted a cleavage of opinion between different Division Benches of the same court regarding the nature of DDT and its applicability to DTAA provisions. Specifically, the decision in M/s. Colorcon Asia Pvt. Ltd. was contrasted with the decisions in Godrej & Boyce Mfg. Co. Ltd. (as confirmed by the Supreme Court) and Small Industries Development Bank of India. The Court found substantial merit in the revenue's contentions that DDT is a tax on the company's profits, not on the shareholder's dividend income, and that sub-sections (4) and (5) of Section 115-O preclude claiming benefits by the company or shareholder. Consequently, the High Court held that the questions of law raised required an answer from a Larger Bench. The Court directed the Registry to place the proceedings before the Chief Justice for the constitution of a Larger Bench to answer the specific questions of law framed.
The High Court allowed the writ petition, quashing and setting aside the impugned order dated 05/12/2023. The Court held that the respondent No.2 had adopted a hyper-technical approach, ignoring the pandemic situation prevalent at the relevant time. The Court reiterated the settled legal position that delay should be condoned liberally and found the impugned order to be contrary to this principle. Consequently, the delay caused by the petitioner in filing the audit report in Form 10B for Assessment Year 2020-21 was condoned. The Court directed respondent No.2 to take appropriate action in accordance with law after providing the petitioner an opportunity of hearing. The ratio is that in situations impacted by a pandemic, a liberal approach should be taken towards condoning delays in statutory filings, and hyper-technical objections should not be the sole basis for refusal.
The High Court noted a cleavage of opinion between different Division Benches of the Bombay High Court regarding the applicability of DTAA benefits to DDT. The Court referred to the decision in M/s. Colorcon Asia Pvt. Ltd. which held that DDT is a tax paid by the company on dividend income of the shareholder, entitling the shareholder to DTAA benefits. Conversely, the decisions in Godrej & Boyce Mfg. Co. Ltd. (confirmed by the Supreme Court) and Small Industries Development Bank of India held that DDT is a tax on the company's profits, not on dividend income in the shareholder's hands, and therefore, DTAA benefits are not applicable. The Court found substance in the revenue's argument that the Colorcon Asia Pvt. Ltd. decision was per incuriam as it was contrary to the Supreme Court's interpretation in Godrej & Boyce Mfg. Co. Ltd. and another Division Bench ruling. Consequently, the Court held that the questions of law required an answer from a Larger Bench.
The High Court noted a cleavage of opinion between different Division Benches of the Bombay High Court regarding the applicability of DTAA benefits to DDT. The Court referred to the decision in Godrej & Boyce Mfg. Co Ltd. (confirmed by the Supreme Court), which held that DDT is a tax on the company's profits and not on dividend income in the shareholder's hands, and that sub-sections (4) and (5) of Section 115-O preclude claiming benefits by the company or recipient. The Court also referred to another Division Bench decision in Small Industries Development Bank of India, which took a similar view. The Court found substance in the revenue's arguments that the decision in Colorcon Asia Pvt. Ltd. was per incuriam as it overlooked the Supreme Court's interpretation. Consequently, the Court held that the questions of law required to be answered by a Larger Bench due to the conflicting opinions.
The High Court noted a cleavage of opinion among different benches of the Bombay High Court regarding the applicability of DTAA provisions to DDT. The Court referred to the decision in Godrej & Boyce Mfg. Co. Ltd. (confirmed by the Supreme Court) and Small Industries Development Bank of India, which held that DDT under Section 115-O is a tax on the company's profits, not on dividend income in the shareholder's hands, and therefore not subject to DTAA benefits. Conversely, the decision in Colorcon Asia Pvt. Ltd. held that DDT is a tax on the dividend income of the shareholder, entitling them to DTAA benefits. The Court found substance in the revenue's argument that the Colorcon Asia Pvt. Ltd. decision was per incuriam, as it was contrary to the Supreme Court's interpretation in Godrej & Boyce. Consequently, the Court held that the questions of law required determination by a Larger Bench.
The High Court did not delve into the merits of any substantive issue concerning the income tax proceedings. Instead, the learned advocate for the petitioners, on instructions, informed the Court that the proceedings under challenge had been dropped by the Income Tax Department. Consequently, the advocate sought leave to withdraw the petitions. The Court, accepting this submission, passed an order dismissing the petitions as withdrawn. No finding was reached on the validity or otherwise of the original income tax proceedings, nor was any principle established for future citation. The operative direction was solely to dismiss the petitions as withdrawn.
The High Court noted the submission by the learned advocate for the Petitioner that the proceedings under challenge had been dropped. Consequently, on instructions, the learned counsel for the Petitioner sought leave to withdraw the writ petitions. The Court, in light of this development, passed an order dismissing the petitions as withdrawn. No decision was rendered on the merits of any income tax assessment or dispute, as the petitions were disposed of based on the withdrawal by the petitioners.
The High Court noted a cleavage of opinion among different benches of the Bombay High Court regarding the taxability of DDT and its interaction with DTAA provisions. The Court referred to the decision in M/s. Colorcon Asia Pvt. Ltd., which held that DDT is a tax paid by the company on the dividend income of the shareholder, entitling the shareholder to DTAA benefits. However, it contrasted this with the Supreme Court's affirmation of the Bombay High Court's view in Godrej & Boyce Pvt. Ltd. and another Bombay High Court decision in Small Industries Development Bank of India, which held that DDT is a tax on the company's profits and not on the dividend income in the shareholder's hands. The Court found substance in the revenue's argument that the Colorcon Asia Pvt. Ltd. decision might be per incuriam, being contrary to the Supreme Court's interpretation. Consequently, the High Court held that the questions of law raised require consideration by a Larger Bench. The Court did not decide the issues on merits but framed specific questions for the Larger Bench to answer regarding the correct interpretation of section 115-O and its interplay with DTAA provisions, particularly in light of the conflicting judgments.
The High Court noted the submission made by the learned advocate for the Petitioner that the proceedings under challenge in the writ petitions had been dropped. Consequently, on instructions from the petitioner, the learned counsel sought leave of the Court to withdraw the matters. The Court accepted this submission and granted the leave. Therefore, the petitions were dismissed as withdrawn. No specific findings on the merits of any tax dispute were made, as the withdrawal was based on the cessation of the challenged proceedings. The operative direction was to dismiss the petitions as withdrawn.
The High Court noted the submission by the learned advocate for the petitioners that the proceedings under challenge had been dropped. Consequently, on instructions from the petitioners, their counsel sought leave to withdraw the matters. The Court, accepting this request, passed an order dismissing the petitions as withdrawn. No decision was made on the merits of the original proceedings or the grounds on which the writ petitions were filed, as the matter was disposed of based on the withdrawal.
The High Court noted the submission made by the learned advocate for the petitioners that the proceedings under challenge in the writ petitions had been dropped. Consequently, on instructions from the petitioners, their counsel sought leave to withdraw the matters. The Court, in view of the submission that the proceedings were dropped and the request for withdrawal, passed an order dismissing the petitions as withdrawn. No decision was made on the merits of any income tax issue, as the petitions were disposed of on the procedural ground of withdrawal. The operative direction was to dismiss the petitions.
The High Court noted the submission by the learned advocate for the Petitioner that the proceedings under challenge in these writ petitions have been dropped. Consequently, on instructions, the learned counsel for the Petitioner sought leave of the Court to withdraw the matters. The Court, in view of this submission and the request for withdrawal, passed an order. The operative direction was that the petitions stand dismissed as withdrawn. No decision was made on the merits of any substantive issue related to income tax law, as the petitions were withdrawn by the petitioners themselves.
The High Court noted the submission by the learned advocate for the Petitioner that the proceedings under challenge in these petitions have now been dropped. Consequently, on instructions, the learned counsel for the Petitioner sought leave of the Court to withdraw the matter. The Court granted this leave. Therefore, the petitions were dismissed as withdrawn. The Court did not decide on the merits of any tax dispute or any specific legal question related to the Income Tax Act. The operative direction was to dismiss the petitions as withdrawn.
The High Court noted a cleavage of opinion between different Division Benches of the Bombay High Court regarding the applicability of DTAA benefits to DDT. The decision in M/s. Colorcon Asia Pvt. Ltd. held that DDT is a tax paid by the company on the dividend income of the shareholder, entitling the shareholder to DTAA benefits. Conversely, the decisions in Godrej & Boyce Mfg. Co. Ltd. (confirmed by the Supreme Court) and Small Industries Development Bank of India held that DDT is a tax on the company's profits, not on the dividend income in the shareholder's hands, and therefore, DTAA benefits are not applicable. The Court found substance in the revenue's arguments that the Colorcon Asia decision was per incuriam, being contrary to the Supreme Court's interpretation in Godrej & Boyce. Consequently, the Court held that the questions of law concerning the correct position on DDT and DTAA applicability, and whether Colorcon Asia was per incuriam, required an answer from a Larger Bench. The appeals were therefore referred to the Chief Justice for constitution of a Larger Bench.
The High Court held that no substantial question of law arises in this case. The Court noted that the ITAT had previously decided in favour of the assessee in its own case for earlier assessment years, holding that its irrigation projects qualified as infrastructure projects and that the assessee was entitled to deduction under Section 80IA(4). This prior decision was not overturned by the High Court. Regarding the additional income, the Tribunal had relied on decisions of the Bombay High Court in Gem Plus Jewellery India Ltd. and CIT Vs. Sheth Developers (P) Ltd., and other Tribunal decisions, to hold the assessee eligible for deduction on the additional income offered. The Court found no merit in the Revenue's grounds of appeal, concluding that the lower authorities had correctly applied the law to the facts and that the issues were settled by prior pronouncements. Therefore, the appeal was dismissed.
The High Court held that the substantial question of law is decided in favour of the appellant-assessee. The Court found that comparing the profits of the Assessee's EOU operating in the foreign market with its sister concern operating in the domestic market, without accounting for material differences in statutory benefits and cost structures, is untenable in law. The capping of the profit share for Section 10B deduction at 19% solely based on the sister concern's profit margin of 19.03% was deemed arbitrary and not sustainable. The Court noted that the ITAT and CIT(A) erred by not first establishing a categoric finding that the course of business between the EOU and the sister concern produced more than ordinary profits, as required by Section 80-IA(10). There was no material to show such an arrangement was producing inflated profits. Consequently, the impugned order of the ITAT was quashed and set aside. The appeal was allowed.
The Tribunal held that the assessment is barred by limitation. It noted that the DRP issued directions on 22.02.2021. As per Section 144C(13) of the Income Tax Act, the Assessing Officer is required to pass a final assessment order within one month from the end of the month in which such directions are received. This meant the order was due by 31st March 2021. Even with extensions granted by CBDT notifications up to 30th June 2021, no order was passed. The Tribunal relied on its own decision in Shell India Markets Pvt. Ltd. vs. Additional Commissioner of Income Tax, New Delhi, which emphasized that Section 144C(13) mandates the completion of assessment within one month of the DRP's directions. Since the Assessing Officer failed to comply with this mandatory timeline, the assessment is time-barred. The writ petition was allowed, quashing the pending assessment. The petitioner also undertook to withdraw a protective appeal filed earlier.
The High Court held that the disposal order dated March 11, 2022, was unreasoned. The Court found that the objections filed by the petitioner were not adequately dealt with, and the order merely stated that they were considered and found unacceptable and untenable in the eyes of law. The Court emphasized that when disposing of objections, the Assessing Officer must provide proper reasons explaining why income is believed to have escaped assessment. Furthermore, the Officer must consider the evidence submitted by the assessee to substantiate their claim that reopening is not justified. On these grounds, the Court disposed of the writ petition by directing the Jurisdictional Assessing Officer to decide the petitioner's objections afresh, providing proper reasons. Additionally, in the peculiar facts of the case, the Court directed that a personal hearing be granted to the petitioner before passing the fresh order on objections, clarifying this direction is not to be treated as a precedent.
The High Court held that the impugned notice dated April 4, 2022, issued under Section 148 of the IT Act for AY 2015-2016, and the consequential Assessment Order dated March 20, 2024, are bad in law. The Court relied on the concession made by the Revenue before the Supreme Court in Union of India Vs. Rajeev Bansal, which was recorded in paragraph 19 of the judgment, stating that for AY 2015-2016, all notices issued on or after April 1, 2021, would have to be dropped. This concession was also followed by the Supreme Court in Deepak Steel and Power Ltd. Vs. CBDT and by the Bombay High Court in Cherian Nallathu Abraham Annamma Vs. ITO and Mitra Biswas Vs. Income Tax Officer. The Court found merit in the petitioner's submission that the notice was invalid, and therefore, it would not deny relief on the grounds of delay and laches, as a delay would not validate an otherwise invalid notice. The Court quashed and set aside the impugned notice, assessment order, and all consequential orders/notices, including recovery notices. The petitioner was directed to withdraw the pending appeal before the CIT (Appeals) within two weeks. The Court also stipulated that if the order was challenged and set aside, the appeal before the CIT (Appeals) would stand revived.
The High Court held that the impugned Notification dated March 16, 2026, issued by the Election Commission of India, is contrary to Clause (a) of the proviso to Section 151-A of the Representation of the People Act, 1951. The Court reasoned that the date of the result announcement for the bye-election would be May 4, 2026, and the remaining period until the end of the Assembly's term on March 14, 2027, is approximately nine months. This period is less than one year, thus contravening the mandate of Clause (a) of the proviso to Section 151-A, which prohibits holding an election if the remaining term is less than one year. The Court found no conflicting view in judgments cited by the Election Commission, specifically Mohammad Farhan Shaik, and therefore rejected the argument for reference to a larger bench. The Court quashed and set aside the impugned Notification, declaring it arbitrary and issued contrary to the law. The writ petitions were allowed, and the miscellaneous civil application was disposed of as nothing survived. The prayer for a stay on the judgment was rejected.
The High Court allowed the petitioner's request to withdraw the Criminal Writ Petition. The Court noted the petitioner's statement that they were not served with the summons or the order dated March 1, 2019, and had been bonafidely pursuing their remedy through the writ petition. The Court directed that if the proposed Criminal Revision Application is filed within four weeks from the date of the order before the competent Sessions Court, it would be considered on its own merits and in accordance with law, without insisting on an application for condonation of delay. All contentions of the parties were kept open for consideration in the Criminal Revision Application. The Court expressly left undecided any substantive issues regarding the merits of the original case or the validity of the order issuing process.
The High Court held that the impugned notices under Section 143(2) and Section 142(1) were unsustainable and quashed them. The Court reasoned that Section 170A(2)(a) of the Act applies when the assessment proceedings are completed on the date of furnishing the modified return. In such cases, the Assessing Officer is required to pass an order modifying the total income determined in the completed assessment, taking into account the order of business reorganisation and the modified return. The Court found that the notices issued by the Revenue were not restricted to modifying the income to give effect to the amalgamation order but sought to re-open the entire assessment. The issuance of a notice under Section 143(2) and a notice under Section 142(1) for de novo assessment is not permissible under Section 170A(2)(a). The Court noted that an assessment already completed can be modified under Section 170A(2)(a) by considering the modified return and giving effect to the amalgamation order. The Court also noted that a fresh assessment order passed on March 24, 2026, under Section 143(3) read with Section 144B, which referred to the modified return but did not give it effect, was also set aside. The Revenue was directed to pass a fresh order modifying the total income as per the intimation under Section 143(1) and giving effect to the modified return.
The Tribunal held that the delay of 13 days in filing Form 10-IC was liable to be condoned. The Tribunal reasoned that the delay was neither deliberate nor malafide, being caused by the undisputed and unfortunate demise of a key family member. It distinguished between the substantive statutory benefit under Section 115BAA and the procedural requirement of filing Form 10-IC. The Tribunal emphasized that procedural requirements should not defeat substantive entitlements, especially when the assessee's eligibility is not in dispute and there is no prejudice to the Revenue. The denial of the benefit would result in a tax liability of over Rs. 5,00,00,000/-, causing immense hardship. The Tribunal found the impugned order to be unduly technical and rigid, lacking application of mind, and defeating substantial justice. The ratio decidendi is that procedural delays, if minimal, genuine, and caused by exceptional circumstances, should be condoned to uphold substantive justice, particularly when no prejudice is caused to the Revenue. The impugned order was quashed, the delay condoned, and the Respondents were directed to process the matter as if Form 10-IC was filed within time.
The High Court allowed the Writ Petition. The Court found that the issue was squarely covered by its previous decision in Alag Property Construction Private Limited vs. ACIT-Circle 15(1)(1) Mumbai & Others, which in turn relied on the Supreme Court's decision in Union of India vs. Rajeev Bansal. In the cited case, the Court had held that for the Assessment Year 2017-18, the appropriate authority to grant sanction for issuing a notice under Section 148 was the one specified in Section 151(ii) of the Act, and not the one specified in Section 151(i). The Court reiterated that non-compliance with the provisions of Section 151 vitiates the Assessing Officer's jurisdiction to issue a notice under Section 148. Consequently, the impugned order dated July 22, 2022 (under Section 148A(d)), the notice dated July 22, 2022 (under Section 148), the reassessment order dated May 11, 2023 (under Section 147 r.w.s. 144B), the notice of demand dated May 11, 2023 (under Section 156), and the show cause notices dated May 11, 2023 (under Sections 271F and 271AAC(1)) were quashed and set aside. The Petitioner also undertook to withdraw an appeal filed before the CIT (Appeals).
The High Court held that the Assessing Officer correctly rejected the Petitioner's application for a NIL withholding tax certificate. The reasoning was that higher authorities had already ruled that payments made by Benteler India to the Petitioner for services rendered are taxable in India for previous assessment years. Issuing a NIL withholding tax certificate would contradict these existing rulings. The Court also noted that Rule 28AA itself contemplates considering the tax payable on income for the last three previous years, and in the Petitioner's case, higher authorities had already determined such payments to be taxable. Regarding the broader issue of taxability of the consideration received by the Petitioner, the Court declined to make any findings. It reasoned that this very issue was pending before the ITAT for previous assessment years, and any declaration by the High Court would directly impact those pending appeals. Therefore, the Court left the decision on taxability to the ITAT.
The High Court disposed of the Writ Petition by directing the Petitioner to pursue its pending Appeal before the CIT Appeals against both the impugned Notice issued under Section 148 and the impugned Assessment Order. The Court explicitly kept open all contentions challenging the Notice and the Assessment Order, including those raised in the Writ Petition, to be agitated before the CIT Appeals. Furthermore, the Court ordered that the impugned Assessment Order shall not be acted upon until the Appeal before the CIT Appeals is decided. The Court clarified that all contentions of all parties are expressly kept open to be agitated before the CIT Appeals, which shall decide them on their own merits and in accordance with law. No issue was expressly left undecided, as the Court deferred the decision on merits to the appellate authority.
The High Court disposed of the Writ Petition by directing the Petitioner to pursue their appeal already filed before the CIT (Appeals) against the impugned Notice issued under Section 148 and the impugned Assessment Order. The Court kept open all contentions challenging the Notice and the Assessment Order, including those raised in the Writ Petition, for agitation before the CIT (Appeals). It was further directed that until the Appeal before the CIT (Appeals) is decided, the impugned Assessment Order shall not be acted upon. The Court clarified that all contentions of all parties are expressly kept open to be agitated before the CIT (Appeals) and will be decided by the CIT (Appeals) on its own merits and in accordance with law. No order as to costs was made.
The High Court disposed of the Writ Petition by directing the Petitioner to pursue its pending appeal before the Commissioner of Income Tax (Appeals) against both the Notice issued under Section 148 and the Assessment Order. The Court explicitly kept open all contentions challenging the impugned Notice and Assessment Order, including those raised in the Writ Petition, for agitation before the CIT (Appeals). Furthermore, the Court ordered that the impugned Assessment Order shall not be acted upon until the appeal before the CIT (Appeals) is decided. The Court clarified that all contentions of all parties are expressly kept open to be decided by the CIT (Appeals) on its own merits and in accordance with law. No decision was made on the merits of the case.
The High Court disposed of the Writ Petition by directing the Petitioner to pursue the Appeal already filed before the CIT (Appeals) against both the Section 148 Notice and the Assessment Order. The Court explicitly kept open all contentions challenging these impugned actions, including those raised in the Writ Petition, for agitation before the CIT (Appeals). It was further directed that the impugned Assessment Order shall not be acted upon until the Appeal before the CIT (Appeals) is decided. The Court clarified that all contentions of all parties are expressly kept open to be decided by the CIT (Appeals) on its own merits and in accordance with law. No decision was made on the merits of the case.
The High Court held that the final assessment order dated February 2, 2026, passed without serving a draft assessment order on the petitioner, who is an "eligible assessee" involved in an "international transaction," is in clear violation of the mandatory provisions of Section 144C and Section 144B(1)(xxi) to (xxix) of the Income Tax Act, 1961. The Court found that the failure to issue a draft assessment order deprived the petitioner of its substantive right to object before the Dispute Resolution Panel (DRP), constituting a jurisdictional error, not a mere procedural irregularity. Relying on its previous decisions in Danfoss Fluid Power Private Limited and SHL(India) Pvt. Ltd., the Court quashed and set aside the impugned final assessment order. The Court rejected the revenue's suggestion to treat the final order as a draft or to remand the matter, stating that once the final order is passed in breach of mandatory provisions, it must be set aside. The Assessing Officer is free to commence the process again by issuing a fresh draft assessment order if legally entitled to do so.
The High Court disposed of the Writ Petition by directing the Petitioner to pursue the appeal already filed before the CIT Appeals against both the Notice under Section 148 and the Assessment Order. All contentions challenging the impugned Notice and Assessment Order, including those raised in the Writ Petition, were kept open to be agitated before the CIT Appeals. The Court further directed that the impugned Assessment Order shall not be acted upon until the appeal is decided by the CIT Appeals. The Court clarified that all contentions of all parties are expressly kept open to be decided by the CIT Appeals on its own merits and in accordance with law. No specific finding was given on the merits of the challenge to the Notice or the Assessment Order, as the matter was remitted to the appellate authority.
The High Court allowed the petitioner to withdraw the Writ Petition. The Court granted the petitioner liberty to challenge the Assessment Order by availing of appellate proceedings available under the Income Tax Act, 1961. The Court further directed that if the petitioner files an appeal within four weeks from the date of the order, the appeal shall be entertained on its merits without the issue of limitation being raised. Any delay in filing the appeal within this four-week period is condoned. Since the Writ Petition was disposed of as withdrawn, the Interim Application, which sought an amendment to the petition, was also disposed of as nothing survived. No order as to costs was made.