The Delhi High Court has quashed reassessment proceedings against Maruti Suzuki.
The bench of Justice Yashwant Varma and Justice Ravinder Dudeja has observed that it is impossible to hold that the AO was unaware of remittances made to SMC, related party transactions and details of TDS deposited. The record which has been analysed by us leads us to the inevitable conclusion that it would be wholly incorrect to hold that the AO was not cognizant of the relevant facts, the different heads of income and expenditure involved, the remittances made to SMC as well as the issue of short and long term capital gains.
The petitioner/assessee, Maruti Suzuki has challenged the reassessment action initiated by the respondent/departmnet under Sections 147/148 of the Income Tax Act, 1961 pertaining to Assessment Year 2009-10. Although the petitioner is stated to have made appropriate disclosures along with the Return of Income3 including the filing of an Audit Report, Form No. 3CEB and a Tax Audit Report, the original RoI was subsequently revised declaring income of INR 12,62,60,79,909.
The RoI was duly examined under Section 143(3) read along with Section 144C of the Income Tax Act and a final assessment order came to be passed on 02 January 2014 by which the Assessing Officer4 computed the total taxable income at INR 20,71,04,18,575/-.
Undisputedly, 31 March 2016 constituted the last date by which a reassessment action for AY 2009-10 could have been initiated in terms of the timelines provided in Section 149.
The writ petitioner contended that the notice under Section 148, however, came to be issued only on 01 April 2016. It is in the aforesaid backdrop that one of the principal grounds on which the reassessment exercise is assailed is of the same being barred by limitation as prescribed.
The court held that the AO has not even made a token or superficial attempt to evaluate the issue from that perspective. The decision to reopen thus clearly appears to have been predicated solely on the basis of what the AO came to hold in AY 2010-11.
Case Details
Case Title: Maruti Suzuki India Ltd. Versus DCIT
Case No.: W.P.(C) 9786/2016
Date: 21 February, 2025
Counsel For Petitioner: Ajay Vohra, Sr. Adv. with Mr. Vaibhav Kulkarni and Mr. Udit Naresh
Counsel For Respondent: Shlok Chandra, SSC with Ms. Naincy Jain, Ms. Madhavi Shukla, JSCs and Mr. Sushant Pandey
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