Delhi High Court
Delhi High Court Sets Aside ₹10 Crore Security Demanded By Customs For Provisional Release Of Seized Goods, Calls It 'Onerous'
Coming to the rescue of an importer, the Delhi High Court has set aside the security of ₹10 crore (approx) demanded by the Customs Department for provisional release of its perishable goods.Calling the condition 'onerous', a division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta ordered provisional release of Petitioner's imported Roasted Areca Nuts on furnishing bond of Rs.4.10 crore along with a Bank Guarantee of Rs. 50 lakh.The Department had claimed that the value of goods as...
Delhi HC Sets Aside Income Tax Action Against Rajat Sharma-Owned India TV's Parent Company Over Alleged Unaccounted Foreign Remittances
The Delhi High Court on Wednesday set aside the reassessment action initiated against journalist Rajat Sharma's company, M/S Independent News Service Pvt. Ltd., which owns and runs the India TV channel, over alleged foreign remittances.The notice was issued following a survey conducted by the Income Tax Department at the J&K Bank back in 2019, revealing that the company had made foreign remittances amounting to ₹6,50,84,454/- during AY 2017-18, which did not tally with the amounts reflected...
Appeal On Taxability Including Point Of Limitation Doesn't Lie Before HC U/S 35G Of Central Excise Act: Delhi High Court
The Delhi High Court has reiterated that an appeal from CESTAT under the Central Excise Act 1944 involving the issue of taxability will lie before the Supreme Court under Section 35L.A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta ruled that such an appeal, even on a limited point of limitation, will not lie before the High Court under Section 35G. It observed,“Even if the question of limitation has been raised, the Court has to go into the merits of the matter after a...
Payments Made To AWS For Cloud Computing Services Not Taxable: Delhi High Court
The Delhi High Court has held that payments made to Amazon Web Services (AWS) for cloud computing services do not qualify as “royalty.” The bench, comprising Justice Vibhu Bakhru and Justice Tejas Karia, upheld the Income Tax Appellate Tribunal's (ITAT) decision which held that such payments are not taxable as royalties or fees for technical services (FTS). The Court referred to earlier judgments to emphasize the difference between transferring intellectual property rights and simply...
WhatsApp, Email Communications Between Parties Can Constitute Valid Arbitration Agreement: Delhi High Court
The Delhi High Court has ruled that communications between the parties through WhatsApp and emails can constitute a valid arbitration agreement. Justice Jasmeet Singh perused Section 7(4)(b) of the Arbitration Act and said that it is not necessary for a concluded contract to be in existence for a valid arbitration agreement to be existing between the parties.The Court was dealing with a plea filed by a UAE based company, Belvedere Resources DMCC, seeking monetary security of approximately...
GST | Alleging Denial Of Hearing Insufficient If Assessee Itself Wasn't Diligent In Responding To SCN Or Attending Hearing: Delhi High Court
The Delhi High Court has refused to interfere with a demand order passed by the GST Department without hearing the assessee, after noting that the assessee itself was not diligent in responding to the show cause notice or attending the personal hearing despite notice.A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed,“Considering the fact that (i) The Department has given the show cause notice and the personal hearing notices to the Petitioner; (ii) The Petitioner...
Party That Unilaterally Appointed Arbitrator Not Barred From Challenging Appointment U/S 12(5) Of Arbitration Act: Delhi High Court
The Delhi High Court bench of Justice Tejas Karia and Justice Vibhu Bakhru has held that a party that unilaterally appoints an arbitrator is not prohibited from challenging the award on the ground that it violates Section 12(5) read with the Seventh Schedule of the Arbitration Act. Mere exercise of the power to make such an appointment does not constitute an express written waiver as required under the proviso to Section 12(5) of the Arbitration Act. Brief Facts: The present appeal...
Plaint Can't Be Rejected Under O.VII R.11 Of CPC Due To Arbitration Clause Unless Application U/S 8 Of A&C Act Is Filed: Delhi High Court
The Delhi High Court bench of Justice Ravinder Dudeja has held that if a proper application is filed under Section 8 of the Arbitration and Conciliation Act, 1996, the Court must refer the parties to arbitration and may reject the plaint under Order VII Rule 11(d) of the Civil Procedure Code, 1908 (CPC) as barred by law. However, if no such application is filed and no prayer is made for reference to arbitration, the mere existence of an arbitration clause is not sufficient to reject the...
S.75(5) Of CGST Act Contemplates A Maximum Of Three Adjournments, Cannot Be Construed As A Minimum Of Three Hearings: Delhi High Court
The Delhi High Court has held that the provision of maximum three adjournments that can be granted to a taxpayer during the course of adjudication proceedings, cannot be construed to mean that the taxpayer must be given a minimum of three hearings.A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed,“A perusal of Section 75(5) of the Central Goods and Service Tax Act, 2017 would show that the said provision merely contemplates that the maximum adjournments shall be...
Taxpayers Must Be Vigilant About Communications On GST Portal, Department Can't Be Blamed: Delhi High Court
The Delhi High Court has made it clear that if an assessee fails to respond to a show cause notice duly communicated to it on the GST portal, the Department cannot be blamed for passing an order raising demand, without hearing the assessee.A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta observed,“Since the Petitioner has not been diligent in checking the portal, no reply to the Show Cause Notice has been filed by the Petitioner. Thus the department cannot be...
Once AO Scrutinises Identity & Creditworthiness Of Shareholders, No Reassessment Action Without 'Additional Info' About Income Escapement: Delhi HC
The Delhi High Court recently rejected Revenue's appeal against deletion of additions made to the income of an assessee-company alleged to have evaded tax, observing that the AO had already scrutinised the identity and creditworthiness of the shareholders and in the absence of any additional material coming to light, reassessment action could not have been initiated.A division bench of Justices Vibhu Bakhru and Tejas Karia observed,“During the original proceedings, the AO had issued a...
Reassessment Notice Can't Be Based On 'General Information' From Investigation Wing Of Income Tax Dept: Delhi High Court
The Delhi High Court has made it clear that the Income Tax Department cannot issue reassessment notice to an assessee based on general information shared by its Investigation Wing, until the Assessing Officer forms definite 'reason to believe' escapement of income.A division bench of Justices Vibhu Bakhru and Tejas Karia observed,“It is clear from the information received from the Investigation Wing…that the same was general in nature and did not point towards the involvement of the Petitioner...