Huawei International Pte. Ltd. Vs ACIT (ITAT Delhi)
Reopening u/s 147 quashed – AO’s “fishing enquiry” to investigate offshore receipts not valid formation of belief- Reassessment void where AO reopens only to verify PE/offshore claims
Assessee, a tax resident of Singapore, engaged in providing ICT infrastructure solutions, challenged the reassessment order dated 30-03-2024 passed u/s 147 r.w.s 144C(13) in conformity with the DRP’s directions. The dispute arose from reopening of assessment for A.Y. 2014-15 based on information that Huawei International Pte Ltd had received ₹3.90 crore from Vodafone Digilink Ltd & ₹37.41 crore as per Form 26AS, which had not been offered to tax in India. AO accordingly issued notice u/s 148, later treated as notice under the new regime u/s 148A(b) following the Supreme Court’s judgment in UOI v. Ashish Aggarwal (2022 SCC OnLine SC 543).
Assessee objected that the reopening was invalid under amended s.149 & 151A since no income “represented in the form of an asset” exceeding ₹50 lakh had escaped assessment, & that the information merely showed offshore supplies for which tax was deducted by the Indian payer. AO overruled these objections, observing that detailed investigation was required to verify whether the receipts were taxable & that Revenue’s review petition against Engineering Analysis Centre of Excellence (P) Ltd. (125 Taxmann.com 42 SC) was still pending. Based on that reasoning, AO passed order u/s 148A(d) & reopened the case.
