Case Law Details
Mastek Limited Vs ACIT (Gujarat High Court)
Gujarat High Court held that Challenge to notice issued under section 154 of the Income Tax Act is maintainable under Article 226 of the Constitution of India.
Facts- The petitioner is a public limited company and a Global Information Technology Service Provider offering a wide range of software development and related services. A return of income was filed for A.Y. 2008-2009 after claiming a deduction u/s. 10A of the Income Tax Act, 1961. The case was selected for scrutiny and notices u/s. 142(1) and 143(2) were issued. During the assessment proceedings, the respondent specifically inquired into the computation of deduction u/s. 10A of the Act and called for evidence and justification in respect of the same which was duly submitted by the petitioner.
In March, 2018, the respondent issued the impugned notice u/s. 154 of the Act to rectify the OGE dated 30.01.2015. According to the respondent, a mistake of law and facts was committed while passing OGE allowing the loss (negative profit) of eligible 10A unit namely SDF VI and SDF VII amounting to Rs.4,46,67,531/- against income from House Property. According to the respondent, the loss (negative profit) will not be allowed to be set off against any other income. This according to respondent was a mistake, hence a notice.
Conclusion- Held that the notice under Section 154 of the Act is barred by limitation, that it was a debatable issue not therefore within the parameters of Section 154 of the Act, the notices under Section 154 of the Income Tax Act are bad. Even on the parameters of interpretation, notice under Section 263 in one of the petitions must also fail. Challenge to such a notice is maintainable under Article 226 of the Constitution of India.
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