Relief to Amadeus IT Group: Delhi HC condones delay of 170 days in re-filing Income Tax Appeal [Read Order]

The Delhi High Court condoned the delay of 170 days in re-filing the Income Tax Appeal by Amadeus IT group and disposed of the petition as there was no question of law to be considered.

The appellant filed the application seeking condonation of a delay of 170 days in re-filing the appeal. This is an application moved on behalf of the appellant/revenue seeking condonation of delay in re-filing the appeal.

Mr Udit Naresh, the counsel, who appeared on behalf of the respondent/assessee, says that he does not oppose the prayer made in the application.

The Tribunal has ruled in favour of the respondent/assessee and in this regard relied upon the decision rendered in the assessee’s case for AYs 2007-08 to 2012-13. It is not disputed by Mr Ruchir Bhatia, standing counsel, who appears on behalf of the appellant/revenue that the issue raised in the instant appeal is covered by the decision of this court dated 31.08.2023 in The Commissioner of Income Tax-International Taxation-1 vs Amadeus IT Group SA, 2023:DHC:6502-DB.

It was held that the Functions, Assets and Risks Analysis [FAR] should not have been applied in ascertaining attribution of profit. Mr Bhatia stated that the statutory authorities have taken recourse to rule 10 of the Income Tax Rules, 1962 [ “Rules”].  

Rule 10 deals with the determination of income in the case of non-residents, wherein states that “In any case in which the [Assessing Officer] is of opinion that the actual amount of the income accruing or arising to any non-resident person whether directly or indirectly, through or from any business connection in India, the amount of such income for assessment to income-tax may be calculated at such percentage of the turnover so accruing or arising as the [Assessing Officer] may consider being reasonable, or on any amount which bears the same proportion to the total profits and gains of the business of such person (such profits and gains being computed by the provisions of the Act), as the receipts so accruing or arising bear to the total receipts of the business, or in such other manner as the [Assessing Officer] may deem suitable.

Since this aspect was not argued before the statutory authorities, a division bench comprising Justice Rajiv Shakdher and Justice Girish Kathpalia dismissed the petition in the absence of a question of law.

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