Hapag Lloyd India Pvt. Ltd. Vs PCIT (Bombay High Court)
Summary: The Bombay High Court considered whether the revisional jurisdiction under Section 264 of the Income-tax Act, 1961 could be invoked where the assessee had not claimed a tax benefit in its original or revised return, and whether the Principal Commissioner of Income Tax was justified in rejecting the revision application on the ground that there was no apparent error in the assessment order.
Hapag Lloyd India Pvt. Ltd., the petitioner, was the successor of United Arab Shipping Agency India Company Pvt. Limited (“UASAC”), which had amalgamated with the petitioner with effect from 1 April 2019 pursuant to an order of the National Company Law Tribunal. UASAC had distributed dividend of Rs.10,16,75,641/- to its holding company, United Arab Shipping Company Limited, incorporated in Kuwait. Dividend Distribution Tax (“DDT”) was paid at 16.91%, including surcharge and cess, amounting to Rs.2,06,99,127/-. UASAC filed its return of income for Assessment Year 2016-17 on 30 November 2016 and a revised return on 23 December 2016.
In both returns, the benefit available under Article 10 of the India-Kuwait DTAA was not claimed. According to the petitioner, the dividend distributed during Financial Year 2015-16 was taxable at 10% under the said Article, and the petitioner was consequently entitled to a refund of Rs.84,61,650/- representing excess tax paid. The petitioner therefore filed an application under Section 264 of the Income-tax Act before the Principal Commissioner.
