GE Hydro France Vs ACIT (Delhi High Court)
Delhi High Court sets aside tax reassessment against GE Hydro France, ruling ‘reason to believe’ based on surveys of other group entities insufficient without year-specific material; Delhi High Court Invalidates Tax Reassessment Based Solely on Other Group Entities’ Surveys; Court Finds ‘Reason to Believe’ Lacked Year-Specific Foundation for GE Hydro France; Delhi HC Quashes Tax Reassessment Against GE Unit.
NEW DELHI: The Delhi High Court has quashed income tax reassessment proceedings initiated against GE Hydro France for the assessment years (AY) 2013-14, 2014-15, and 2015-16. The court found that the tax authorities’ decision to reopen the assessments was based predominantly on survey findings related to other entities within the broader GE/erstwhile Alstom group, without establishing a sufficient year-specific link or independent material for GE Hydro France itself.
The case involved reassessment notices issued under Section 148 of the Income Tax Act, 1961. For AY 2013-14, GE Hydro France had filed its original and a revised return of income. A notice under Section 148 was issued on March 19, 2021, citing survey reports and findings from surveys conducted on various constituents of the GE group. The reassessment action was initiated under the law as it stood prior to the amendments by the Finance Act, 2021, following the procedure laid down by the Supreme Court in GKN Driveshafts (India) Ltd. v. Income Tax Officer and Ors.
