9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (8) TMI 160 - HC - Income TaxRevision u/s 263 against company as dissolved - petitioner as the agent of Monet company as dissolved - share transfer transaction, prima-facie appears to be a tax avoidance arrangement to avoid paying taxes in India - Who may be regarded as agent u/s 163? - As decided by ITAT order passed u/s 163 by the CIT deserves to be quashed and treated as nonest. CIT assumed jurisdiction u/s 263 of the Act on the basis of order passed u/s 163 of the Act. HELD THAT - Since the very basis order u/s 163 of the Act has been removed, the super structure i.e. order u/s 263 of the Act must fall. Having regard to the operative directions issued by the Tribunal, according to us, these writ petitions would not lie, as obviously, the court cannot quash something, which has already been quashed by the Tribunal.
Issues involved:
The issues involved in this case are related to the assessment year 2016-17, notice under Section 163 of the Income Tax Act, 1961, tax avoidance arrangement, liability of the petitioner as a representative assessee, and the quashing of orders by the Tribunal. Assessment Year 2016-17: The writ petitions were filed to challenge the notice dated 26.03.2021 and the order dated 27.03.2021 issued under Section 163 of the Income Tax Act, 1961 for the assessment year 2016-17. The petitioners sought to assail these notices in the backdrop of purchasing shares from an entity named Mankind Pharmaceuticals Limited, which were originally purchased from Monet Limited, incorporated in Mauritius. The Assessing Officer had accepted Monet's claim under the India-Mauritius Double Taxation Avoidance Agreement, and Monet was dissolved in 2018. Tax Avoidance Arrangement: The Commissioner of Income Tax observed that the share transfer transaction appeared to be a tax avoidance arrangement to evade taxes in India. The Commissioner relied on the case of Malabar Industrial Co. Ltd. v. Commissioner of Income-tax to support the proceeding under Section 263 of the Act. The Commissioner held the petitioners jointly and severally liable for income tax proceedings due to lack of clarity in the Share Purchase Agreement regarding the number of shares purchased by certain entities. Liability of Petitioner as Representative Assessee: The Commissioner's order dated 31.03.2021 canceled the assessment order concerning Monet and held the petitioner jointly and severely liable as the representative assessee. The CIT(A) directed the Assessing Officer to conduct a fresh assessment exercise. The petitioner appealed to the Tribunal, which allowed the appeal and quashed the order issued under Section 163 of the Act, stating that the foundation of the order had been removed, leading to the fall of subsequent orders. Quashing of Orders by Tribunal: The Tribunal's order dated 19.12.2022 quashed the order under Section 163 of the Act, leading to the removal of subsequent orders. The Tribunal's decision rendered the writ petitions unnecessary, as the court cannot quash something already nullified by the Tribunal. However, if the revenue chooses to appeal, the petitioners may seek appropriate recourse in accordance with the law. In conclusion, the writ petitions were disposed of based on the Tribunal's decision to quash the order under Section 163 of the Act, removing the basis for further actions.
|
