NDLI: Delhi Television Ltd. Vs. Deputy Commissioner of Income Tax

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	Income Tax Act
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Act(s) Referred	Companies Act, 1956 (1 of 1956) Income Tax Act, 1961 (43 of 1961)
Case(s) Referred	Referred Case 0 Referred Case 1 Referred Case 2 Referred Case 3
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Allowed
Headnote	Income Tax Act, 1961 : s.147 – Power under, invocation of – Whether the revenue had sufficient reasons to believe that undisclosed income of the assessee has escaped assessment and there were grounds to issue notice u/s.147 – Held: Information which comes to the notice of the assessing officer during proceedings for subsequent assessment years can definitely form tangible material to invoke powers vested with the assessing officer u/s.147 of the Act – At the stage of issuance of notice, the assessing officer is to only form a prima facie view – In the instant case, material disclosed in assessment proceedings for subsequent years was sufficient to form such a view – Accordingly, there were reasons to believe that income had escaped assessment in this case. Income Tax Act, 1961: s.147, first proviso – Limitation – Invocation of extended period – Allegation of non-disclosure of material facts – Allegation that the assessee was guilty of creating network of shell companies with a view to transfer its untaxed income in India to entities abroad and then bring it back to India thereby avoiding taxation – Revenue placed reliance on certain complaints made by the minority shareholders and it was alleged that those complaints revealed that assessee was indulging in round tripping of its funds – Held: These complaints did not see light of the day either before the High Court or before this Court and, therefore, it was unfair to the assessee if they were relied upon – Revenue can take the benefit of the extended period of limitation of 6 years for initiating proceedings under the first proviso s.147 of the Act, only if revenue can show that the assessee had failed to disclose fully and truly all material facts necessary for its assessment – Assessee had disclosed all the facts it was bound to disclose – If the revenue wanted to investigate the matter further at that stage it could have easily directed the assessee to furnish more facts – Assessee made a disclosure about having agreed to stand guarantee for the transaction by NNPLC and it had also disclosed the factum of the issuance of convertible bonds and their redemption – The income, if any, arose because of the redemption at a discounted price – This was an event which took place subsequent to the assessment year in question though it may be income for the assessment year – All relevant facts were duly within the knowledge of the assessing officer – Assessing officer knew who were the entities who had subscribed to other convertible bonds and in other proceedings relating to the subsidiaries the same assessing officer had knowledge of addresses and the consideration paid by each of the bondholders – The fact that step-up coupon bonds for US$ 100 million were issued by NNPLC was disclosed; who were the entities which subscribed to the bonds was disclosed; and the fact that the bonds were discounted at a lower rate was also disclosed before the assessment was finalised – This transaction was accepted by the assessing officer and it was clearly held that the assessee was only liable to receive guarantee fees on the same which was added to its income – It cannot be said that the assessee had withheld any material information from the revenue. Income Tax Act, 1961: s.147, second proviso – Plea of revenue that in terms of second proviso to s.147 r/w s.149(1)(c), limitation period would be 16 years since assessee has derived income from foreign entity – Held: The notice issued to assessee was silent with regard to second proviso – In the notice, there was no mention of any foreign entity – There was only mention of s.148 – There was nothing to indicate that revenue was intending to apply the extended period of 16 years – It was only after assessee filed its reply to the reasons given, that in the order of rejection for the first time, reference was made to the second proviso by the revenue – This is not fair or proper procedure – Assessee could not be taken by surprise at the stage of rejection of its objections or at the stage of proceedings before the High Court that the notice is to be treated as a notice invoking provisions of the second proviso of s.147 of the Act – Accordingly, the notice and the supporting reasons did not invoke provisions of the second proviso of s.147 of the Act and, therefore, at this stage the revenue cannot be permitted to take benefit of the second proviso.
Judge	Hon'ble Mr. Justice Deepak Gupta
Neutral Citation	2020 INSC 330
Petitioner	Delhi Television Ltd.
Respondent	Deputy Commissioner Of Income Tax
SCR	[2020] 7 S.C.R. 649
Judgement Date	2020-04-03
Case Number	1008

Sl.	Authority	Responsibilities	Communication Details
1	Ministry of Education (GoI), Department of Higher Education	Sanctioning Authority	https://www.education.gov.in/ict-initiatives
2	Indian Institute of Technology Kharagpur	Host Institute of the Project: The host institute of the project is responsible for providing infrastructure support and hosting the project	https://www.iitkgp.ac.in
3	National Digital Library of India Office, Indian Institute of Technology Kharagpur	The administrative and infrastructural headquarters of the project	Dr. B. Sutradhar bsutra@ndl.gov.in
4	Project PI / Joint PI	Principal Investigator and Joint Principal Investigators of the project	Dr. B. Sutradhar bsutra@ndl.gov.in Prof. Saswat Chakrabarti will be added soon
5	Website/Portal (Helpdesk)	Queries regarding NDLI and its services	support@ndl.gov.in
6	Contents and Copyright Issues	Queries related to content curation and copyright issues	content@ndl.gov.in
7	National Digital Library of India Club (NDLI Club)	Queries related to NDLI Club formation, support, user awareness program, seminar/symposium, collaboration, social media, promotion, and outreach	clubsupport@ndl.gov.in
8	Digital Preservation Centre (DPC)	Assistance with digitizing and archiving copyright-free printed books	dpc@ndl.gov.in
9	IDR Setup or Support	Queries related to establishment and support of Institutional Digital Repository (IDR) and IDR workshops	idr@ndl.gov.in

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