Case Law Details
PCIT Vs Samsung India Electronics Pvt. Ltd. (Delhi High Court)
Reassessment proceedings cannot be initiated after a lapse of four years in absence of new tangible material and audit objections alone do not fulfill the criteria for reopening assessments
The case of PCIT vs Samsung India Electronics Pvt. Ltd. revolves around the validity of reassessment proceedings initiated by the Revenue for the Assessment Year (AY) 2002-03, specifically concerning whether there was sufficient new tangible material to justify reopening the assessment after the lapse of four years.
In summary, Samsung India Electronics Pvt. Ltd. initially filed its Income Tax Return (ITR) for AY 2002-03 declaring a loss of Rs. 4,63,27,044/- and a book profit of Rs. 80,47,676/- under Section 115JB of the Income Tax Act, 1961. Subsequently, after scrutiny, an assessment order was passed on 21.03.2005 under Section 143(3) of the Act, making various additions and assessing the business income at Rs. 67,97,24,064/-.
Reassessment proceedings were initiated with a notice dated 25.03.2009 under Section 148 of the Act, citing reasons that included disallowance of certain expenses and receivables. Samsung contested this, arguing that there was no fresh material to justify reopening. Despite this, a reassessment order was passed on 16.12.2009 under Section 147/143(3) of the Act, adding to the taxable income.
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