×Latest Case Laws on Income Tax by various High Courts of India
These are the latest case laws decided by various High Courts of India on Income Tax which have been published recently. The case laws are open for discussion and we invite expert comments from our members on its applicability and effect on relevant issues.
14-10-2019, Vodafone Idea, Section 241A, 197, HIGH COURT OF BOMBAY
1. These petitions arise in similar background. They have been heard together and would be disposed of by this common judgment. Primary facts may be noted from Writ Petition No. 2145 of 2019. To the extent the facts are different, shall be noted from the companion petition.
2. Petitioner is a public limited company and is engaged in the business of providing telecommunication services. For the assessment year 2017-18, the petitioner had filed return of income on 31.10.2017 which was subsequently revised on 28.3.2019. As per the return, the petitioner had declared loss to the tune of Rs. 6600.47 crores (rounded off). Resultantly, the petitioner had claimed refund of the entire amount of tax paid at source which came to Rs. 565.28 crores (rounded off) and tax collected at source of Rs. 22,31,792/-. The return of the petitioner thus gave rise to refund of Rs. 565.51 crores (rounded off).
3. The return of income was processed by respondent No. 1 - Assessing Officer under Section 143(1) of the Income Tax Act, 1961 (“the Act” for short) on 24.3.2019. After certain adjustments, this process of return gave rise to refund of Rs. 562.68 crores (rounded off) with statutory interest, the total refund worked out to Rs. 630.21 crores (rounded off). To complete the facts, we may record that the petitioner’s revised return was processed by the Assessing Officer on 14.9.2019. Along with interest, this gave rise to refund of sum of Rs. 634.14 crores (rounded off). This would of course subsume the refund arising out of the original return.
4. The respondents, have, however, not released the refund. Firstly an intimation came to be generated on 24.3.2019 from the computer system by the Income Tax Department. This intimation contained a following recitation :-
“The refund determined u/s 143(1) in this intimation has been withheld as per the provisions of section 241A of Income Tax Act, 1961. The refund, if any, will be released on completion of assessment u/s 143(3)/144 as the case may be, along with interest u/s 244A and subject to adjustment of arrear demand, if any, u/s 245. Please contact the Assessing Officer for more detail.”
5. On 21.8.2019, the Assistant Commissioner of Income Tax communicated to the petitioner an order passed by the Joint Commissioner of Income Tax under newly inserted Section 241A of the Act which is challenged in this petition. This order reads thus:-
“Idea Cellular Ltd now known as Vodafone Idea Ltd AY 2017-18 29th March 2019. Processing the return of income for AY 2017-18 resulted in refund of Rs. 630.20 Cr.
2. It is seen that the assessee declared income of Rs. 286.89 Cr. In 2016-17 whereas it declared as huge loss in AY 2017-18.
3. It is seen that the assessment proceedings are pending involving various issues including transfer pricing. Further the issue of huge loss in AY 2017-18 whereas there was substantial income in immediate preceding assessment year i.e AY 2016-17 needs through investigation.
4. There had been number of additions every year wherein appeals are pending with ITAT. Some of the issues are as under:-
A. Revenue Share License Fees
B. Discount to prepaid distributors – Non deduction of TDS -40(a)(ia)
C. International Roaming charges – Non deduction of TDS – 40(a)(i)
D. Lease rent paid to Quippo