9911796707
TMI Blog2014 (4) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... Gurgaon, Haryana. It is engaged in the business of Adobe Products - shrink-wrapped/ off-the-shelf computer software. For the first time it filed a return of income for the assessment year 2008-09 on 31.03.2010 with the respondent declaring "nil" taxable income. A notice under Section 143(2) was served on the petitioner on 20.08.2010 in respect of the return. A draft assessment order under Section 144C was proposed by the respondent on 17.12.2010 and the proceedings were referred to the Disputes Resolution Panel (DRP). In the meantime i.e. after the issue of notice under section 143(2) by the respondent and before the preparation of the draft assessment order, a notice under Section 142(1) was issued on 14.09.2010 by the Deputy Director of Income Tax, International Taxation, Noida (hereinafter referred to as "the Noida officer") calling for a return for the income for the assessment year 2009-10. The petitioner pointed out that the jurisdiction to assess a non-resident company is determined either on the basis of the location of the "permanent establishment" (PE) of the non-resident company or the location of a source of income accruing to the company in India and that the petitione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of escapement of income were mentioned in the notices for the other two years. 5. On receipt of the reasons recorded for reopening the assessments the petitioner wrote to the Noida officer on 02.11.2011 on the subject and in this letter it again reiterated its earlier objections i.e. that the Noida officer did not have jurisdiction over the petitioner since the petitioner was already being assessed to income tax by the respondent at Delhi. On 04.11.2011 the Noida officer transferred the proceedings and records to the respondent. Thereafter on 14.11.2011 the respondent issued notices under Section 142(1) calling upon the petitioner to file returns of income for the assessment years in respect of which notices were earlier issued under Section 148. Predictably, the petitioner's response was; (a) the notices under Section 148 were issued without any jurisdiction by the Noida officer and at the time when they were issued i.e. 30.03.2011 the jurisdiction to assess the petitioner was with the respondent; (b) notice issued under Section 142(1) for the assessment year 2004-05 was barred by limitation since it was issued beyond the period of six years from the end of the relevant assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions which took place between the petitioner and the respondent sometime in January, 2013; during that discussion, it would appear that the respondent had stated that the objections filed by the petitioner to the jurisdiction to reopen the assessments would be considered only after returns of income were filed by the petitioner in response to the notices under Section 148 as held by the Supreme Court in the case of "G.K.N. Drive Shafts (India) Ltd. vs. ITO", (2003) 259 ITR 19. After referring to the observations of the respondent, the petitioner submitted that the aforesaid judgment was not applicable since the very assumption of jurisdiction by the Noida officer was invalid according to the petitioner and, therefore, the only course open to the respondent was to drop the proceedings. 8. On 08.03.2013, the respondent passed the impugned order which is identical for all the three assessment years for which notices were issued under Section 148. In this order the respondent disposed of the objections filed by the petitioner to the reasons recorded for reopening the assessments. The points made by the respondent in this order are as follows: - (a) The petitioner has not filed any re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id reasons the respondent concluded that the objections raised by the petitioner were without merit and dismissed them. From what has been narrated above, it seems clear that the validity of the proceedings which were continued by the respondent depends upon the validity of the initiation of the proceedings for reassessment by notices issues on 30.03.2011 by the Noida officer. If the notices are valid, then the case having been transferred from the Noida officer to the respondent at Delhi under Section 127(1) of the Act, the respondent can validly continue those proceedings which have to ultimately terminate in orders of reassessment. The question whether the initiation of reassessment proceedings by the Noida officer was valid or not would depend upon whether the petitioner had a PE within the jurisdiction of the Noida officer in which case the notification No.263 issued on 14-9-2001 would apply. Whether this jurisdictional fact existed or not cannot be examined in these proceedings taken under Article 226 since the question is hotly contested, the revenue alleging that the petitioner did have a PE at Noida by the name Adobe India and the petitioner emphatically denying the same. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the notice issued under Section 148. The conduct of the petitioner has been one of defiance; it did not file returns in response to the notices issued under Section 148. The mere filing of the return can never amount to submitting to the jurisdiction. The filing of the return in response to the notice under Section 148 defines the stand taken by the assessee. Section 148 says that the return called for by the notice issued under that section shall be treated as if such a return were a return required to be furnished under Section 139 of the Act. Under the scheme of the Act, a return of income conveys the position taken by the assessee to the assessing authority - whether he has taxable income or not. It is not a mere scrap of paper. There is a sanctity attached to the return. If the assessing authority calls upon the assessee to file a return of income, the same shall be complied with by the assessee and it is no answer to the notice to say that since in his (assessee"s) opinion there is no taxable income, he is under no obligation to file the return. The petitioner, not having made the Noida officer aware that no income chargeable to tax had escaped assessment and having merel ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
