Case Law Details
Dun & Bradstreet Technologies & Data Services Pvt. Ltd. Vs PCIT (Madras High Court)
Introduction: The Madras High Court, in the case of Dun & Bradstreet Technologies & Data Services Pvt. Ltd. vs. PCIT, delivered a crucial judgment regarding the inapplicability of Section 248 of the Income Tax Act to the declaration and distribution of dividends by a company to its shareholders. This article delves into the details of the case and the significant legal interpretations made by the court.
Detailed Analysis: The petitioner contested an order rejecting its application for revision under Section 264 of the Income Tax Act. The case revolved around the petitioner, engaged in providing IT and IT-enabled services, filing its return of income for the assessment year 2018-2019. During this period, the petitioner declared and paid dividends to its holding company, M/s. Predictive Analytics Mauritius Holding Limited (PAMHL). Subsequently, realizing the benefit under Section 90 of the Income Tax Act and the Double Taxation Avoidance Agreement (DTAA) between India and Mauritius, the petitioner sought a revision of the assessment.
The rejection of the revision application was based on two grounds – the petitioner could have filed a revised return or appealed under Section 248 of the Income Tax Act. The court, however, found both grounds untenable. It emphasized that when a statute prescribes a remedy, the petitioner cannot be denied that remedy merely because an alternative remedy may be available, especially when the remedy is statutory.
The second ground, based on Section 248, was deemed inapplicable to the case at hand. Section 248 primarily deals with tax deducted on payments under Section 195 of the Income Tax Act, involving non-residents. Since the petitioner’s case related to the declaration and distribution of dividends, Section 248 was found to be irrelevant.
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