Idemia Identity And Security India Private Limited Vs ACIT (Delhi High Court)
The Delhi High Court has set aside a notice issued under Section 148 of the Income Tax Act, 1961, and consequential proceedings under Section 147 for Assessment Year (AY) 2019-20, against Idemia Identity And Security India Private Limited. The court ruled that the impugned notice, dated March 21, 2024, was issued beyond the period of limitation prescribed under Section 149(1)(a) of the Act.
The petitioner, Idemia Identity And Security India Private Limited, argued that the notice and subsequent proceedings were legally unsustainable due to having been issued beyond the statutory time limit. The impugned notice was issued following a search conducted on March 21, 2023, at the petitioner’s premises and other associated entities.
For AY 2019-20, the petitioner had filed its return on November 30, 2019, declaring an income of ₹2,09,00,156. The Assessing Officer (AO) initiated the reassessment proceedings under Section 148, citing reasons that focused on “huge amounts of management fee paid by the petitioner to Idemia France and other associated enterprises during the Financial Years (FYs) 2016-17 to 2022-23.” The AO contended that these payments were higher than what should have been paid for services rendered by the petitioner’s associated enterprises (AEs), suggesting “massive profit shifting outside India.”
