Teleperformance Global Service Pvt. Ltd. Vs ACIT (Bombay High Court)
The Bombay High Court quashed the reopening notice issued to Teleperformance Global Services Pvt. Ltd. under Section 148 of the Income Tax Act, 1961, for the assessment year 2019-20. The dispute arose after the Income Tax Department alleged that certain transactions were linked to the PAN of Intelenet Global Services Pvt. Ltd. (IGSPL), which had amalgamated with the petitioner in 2011. Despite the petitioner’s clarification that all transactions were accounted for in its income tax return, the department proceeded with issuing a notice under Section 148A(b), followed by an order under Section 148A(d) and a final reassessment notice under Section 148. The petitioner challenged these actions on the ground that the approval granted by the Principal Commissioner of Income Tax (PCIT) under Section 151 lacked due diligence and application of mind.
The court found clear discrepancies in the approval process. The quantum of escaped income was stated inconsistently across different sections of the approval document. The approving authorities, including the Additional/Joint Commissioner and the PCIT, failed to verify these inconsistencies before granting approval. The respondents later justified the error as typographical, but the court rejected this explanation, noting that if the officers had thoroughly reviewed the documents, they would have detected the mistakes. Concluding that the approval was granted mechanically without due examination, the court set aside the order under Section 148A(d) and quashed the subsequent reassessment notice. This ruling reinforces the principle that reopening assessments must be done with due diligence and not on a mere formality.
