Remission of Income Tax Refund of Rs 95.26 crores: Delhi HC suspends Reassessment Proceedings [Read Order]

The Delhi High Court suspended the reassessment proceedings in the matter of remission of income tax refund of Rupees 95.26 crores.

The petitioner in the present matter is Bid Services Division (Mauritius) Limited. Ruchir Bhatia, senior standing counsel, who appeared on behalf of the respondents/revenue, informed the High Court that pursuant to the High Court order dated 30.05.2023 read with the order dated 25.07.2023, refund due to the petitioner/assessee has been remitted. Kamal Sawhney, who appeared on behalf of the petitioner/assessee, affirmed this position.

Furthermore, the counsel for the petitioner argued that this writ petition has served its purpose, inasmuch as the impugned notice dated 27.01.2021 issued under Section 148 of the Income Tax Act, 1961 which was founded on the basis of decision dated 10.02.2022 passed by the Authority for Authority for Advance Ruling [“AAR”] stands set aside by the Bombay High Court via judgment dated 08.03.2022 passed in Writ Petition 713/2021 titled Bid Services Division (Mauritius) Ltd. v Authority for Advance Ruling (Income Tax) and Ors.

The standing counsel argued that since the Bombay High Court has remitted the matter to AAR for reconsideration, it is in the realm of possibility that a decision would be rendered by the said authority in the near future. Thus, the argument is that it is only at that juncture the court could examine viability of the reassessment proceeding triggered via the impugned notice.

A Division Bench of Justices Rajiv Shakdher and Girish Kathpalia observed that “We are of the view that at present, the best way forward would be to keep the reassessment proceeding at abeyance, to await the decision of the AAR upon remand order by the Bombay High Court. As and when the decision is rendered by the AAR, parties can then approach the court for appropriate directions, which may include the direction to reignite the reassessment proceeding.”

To Read the full text of the Order CLICK HERE

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