CIT- International Taxation Vs Qualcomm Incorporated (Supreme Court of India)
The Supreme Court of India dismissed the special leave petitions filed by the Revenue, thereby affirming the orders of the Income Tax Appellate Tribunal (ITAT) which had held that the draft and final assessment orders were barred by limitation under Section 153(2A) of the Income Tax Act, 1961. The Supreme Court declined to interfere, finding that no substantial question of law arose for consideration.
Read HC Judgment: CIT – International Taxation Vs Qualcomm Incorporated Vs (Delhi High Court)
The dispute arose from assessments for Assessment Years 2005–06 and 2006–07. The ITAT had concluded that the Assessing Officer’s draft assessment order dated 27 December 2016 and the final assessment order dated 31 October 2017 were time-barred, as they were not completed within the period prescribed under Section 153(2A) following an appellate remand.
Under Section 153(2A), as it stood at the relevant time, a fresh assessment pursuant to an appellate order under Sections 250 or 254 had to be completed within a stipulated period calculated from the end of the financial year in which the appellate order is “received” by the competent authority, subject to specified provisos.
On facts, the assessee had filed its return of income on 3 April 2007, which was scrutinised and assessed under Section 143(3) on 31 December 2007. Additions were made, including taxation of revenue from BREW operator agreements and royalty on CDMA handsets. The first appellate authority substantially confirmed the assessment, with limited relief. The assessee carried the matter to the ITAT, which by order dated 20 February 2015 deleted certain additions and partially remanded the matter to the Assessing Officer for fresh consideration.
