Nihilent Technologies Private Limited Vs DCIT & Anr. (Mumbai High Court)- A division bench of the Bombay high court has quashed the reopening of the income tax assessment of Nihilent Technologies Ltd after four years. The software company had shares held by Hatch Investments (Mauritius) Ltd. The shareholding was reduced from 99.85 percent to 76.63 percent. The assessment for 2003-04 was completed in 2006 wherein the carried forward loss incurred by the firm in the assessment year 2001-02 was allowed to be set off. Last year the assessment was sought to be reopened on the ground that the shareholding pattern has changed and losses could not be carried forward. The high court rejected this argument.
Nihilent Technologies Private Limited Vs DCIT & Anr.
Writ Petition No. 10104 of 2010
Mumbai High Court
Date: 18th July, 2011
ORAL JUDGMENT:
(Per J.P. Devadhar, J.)
1. Rule. Rule is made returnable forthwith. By consent of parties, the petition is taken up for final hearing.
2. This petition is filed to challenge the notice dated 29th March 2010 issued under Section 148 of the Income Tax Act, 1961 seeking to reopen the assessment for assessment year 2003-2004. The petitioner – assessee has also challenged the order dated 16th December, 2010 whereby the objections raised by the assessee for reopening of the assessment have been rejected.
3. The assessee is a private limited company engaged in the business of development of software. The shares of the assessee company were held in the initial three years, as follows.
