Tax
Penalty Provision U/S 16(7) HP VAT Act Cannot Be Invoked Without First Ascertaining Applicability Of S.16(4): Himachal Pradesh High Court
The Himachal Pradesh High Court has held that the penalty provision couched in Section 16(7) of the HP Value Added Tax Act, 2005 cannot be invoked until the statutory authority is satisfied regarding the applicability of Section 16(4) of the Act.Section 16(4) requires a registered dealer to pay the full amount of tax due from him into a Government Treasury before it furnishes the return. Failure to do so attracts a penalty under Section 16(7).A division bench of Justices Tarlok Singh Chauhan and...
Importation Of Wireless Access Points Which Operate Solely On MIMO Technology Exempt From Customs Duty: Delhi High Court
Coming to the rescue of an IT distribution company, the Delhi High Court has held that the import of Wireless Access Points (WAPs), which operate on MIMO technology, are exempt from Customs duty.In doing so, the division bench of Acting Chief Justice Vibhu Bakhru and Justice Swarana Kanta Sharma held that the word “and” used between 'MIMO and LTE Products', which are eligible for exemption under the relevant notification issued by the Centre, is disjunctive.It thus rejected the Customs'...
Tax Annual Digest 2024: Part I
Reopening Of Assessment Inspired From 'Review' & 'Change Of Opinion' By Subsequent AO Is Deprecated: Madras HCWhile setting aside the order disposing of assessee's objection for re-opening of assessment pursuant to the issue of notice u/s 148 of the Income tax Act, 1961 and the consequent reassessment order, the Madras High Court held that there is no scope for re-opening of the assessment, since the reasons cited for same was inspired from change of opinion of the Assessing officer. A...
Penalties Like Seizure, Detention Of Goods In Transit U/S 129 CGST Act Shouldn't Be Imposed To Penalise Minor Breaches: Delhi High Court
The Delhi High Court has held that Section 129 of the Central Goods & Services Tax Act, 2017 which pertains to detention, seizure and release of goods while in transit cannot be invoked for imposing penalties for minor breaches, like incomplete e-way bill.A division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar further held that Section 129 cannot, merely by virtue of its non-obstante clause, be construed to have an overriding effect on Section 126 which interdicts tax...
Whether Entity Is 'Permanent Establishment' Is A Fact-Specific Issue, Must Be Examined Separately For Different Tax Periods: Delhi High Court
The Delhi High Court has held that whether an entity is a Permanent Establishment (PE) of a foreign company or not is a “fact-specific” issue which must be examined separately for different tax periods.A division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar observed,“The position of a PE being a facts-specific issue and thus liable to be examined against the backdrop of what obtained in a particular tax period…”Reliance was placed on a Commentary of the Organization for...
Delhi High Court Distinguishes From SC's Sky Light Judgment, Declines Assessment Issued In Wrong Name After Entity's Merger
The Delhi High Court on Friday declined the Income Tax Department's appeal to treat as 'curable', the error committed in naming the relevant entity while issuing reassessment notices.A division bench of Justices Yashwant Varma and Dharmesh Sharma refused to grant the benefit which the Supreme Court had given to the Department in Sky Light Hospitality LLP v. Assistant commissioner of Income-tax (2018). It observed,“It was the conduct of the assessee in Sky Light which had convinced the Supreme...
[S.151 IT Act] SC Judgment In Rajeev Bansal Doesn't Affirm Authority Of Joint Commissioner To Accord Approvals For Reassessment: Delhi HC
The Delhi High Court has held that the Supreme Court's decision in Union of India and Ors. vs. Rajeev Bansal (2024) did not affirm the authority of a Joint Commissioner to grant approval under Section 151 of the Income Tax Act, 1961 for initiation of reassessment proceedings. The provision precludes the Assessing Officer from issuing notice for reassessment after the expiry of four years from the end of the relevant Assessment Year, unless the Principal Chief Commissioner or...
[S.115JB Income Tax Act] Delhi HC Rejects Dept's Appeals Against Tata Power's Joint Venture With Delhi Govt For Supply Of Electricity
The Delhi High Court has held that Section 115JB of the Income Tax Act, 1961, as it stood prior to its amendment by virtue of Finance Act, 2012, would be inapplicable to an electricity generation company. A division bench of Acting Chief Justice Vibhu Bakhru and Justice Swarana Kanta Sharma thus dismissed the Department's appeals against Tata Power Delhi Distribution Limited, a joint venture of Tata Power with the Delhi government for purposes of power generation and distribution of ...
ITAT Cannot Decide On Grounds Not Addressed By Commissioner Of Income Tax (Appeals): Delhi High Court
The Delhi High Court recently said aside an order passed by the Income Tax Appellate Tribunal, deciding grounds that did not arise from the impugned order passed by the Commissioner of Income Tax (Appeals). A division bench of Acting Chief Justice Vibhu Bakhru and Justice Tushar Rao Gedela observed, “The Assessee's challenge to the addition of ₹4,30,00,000/- under Section 68 of the Act had remained unaddressed by the learned CIT(A) but had been affirmed by the learned ITAT, without...
Baggage Rules Should Be Reviewed To Prevent Harassment Of Genuine Air Travellers Carrying Gold Jewellery To Attend Weddings: Delhi HC
The Delhi High Court has urged the Central government as well as the Customs department to review the Baggage Rules, 2016 which regulate the amount of gold or gold jewellery that can be carried by a person travelling to India by air. A division bench of Justices Prathiba M. Singh and Dharmesh Sharma observed, “While, there is no doubt that any illegal smuggling of gold deserves to be curbed, at the same time, bona-fidely and genuine tourists/travellers, including people from Indian...
Samsung India Electronics Not A 'Permanent Establishment' Of Samsung Korea, Cannot Be Taxed In India: Delhi High Court
The Delhi High Court has held that Samsung India Electronics Pvt. Ltd (SIEL), a wholly owned subsidiary of South Korea-based Samsung Electronics Co. is not its 'Permanent Establishment' (PE) in India, hence not exigible to tax here.A division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar agreed with ITAT's findings that the secondment of employees by Samsung Korea was merely with the objective of facilitating the activities of SIEL, not its own.It observed,“the secondment of...
S.149 IT Act | Additions Made During Reassessment Don't Validate Proceedings Initiated For Income Escapement Below ₹50 Lakh Threshold: Delhi HC
The Delhi High Court has held that the benchmark of minimum Rs. 50 lakh income escapement prescribed under Section 149 of the Income Tax Act, 1961 must be met at the very initiation of reassessment proceedings. A division bench of Justices Yashwant Varma and Dharmesh Sharma observed, “Additions ultimately made in the course of reassessment would not validate the initiation of proceedings if founded on income of INR 46,17,000/- having escaped assessment and thus evidently below the...