Dongfang Electric Corporation Ltd. Vs CIT (Telangana High Court)
The Telangana High Court decided a batch of writ petitions by common order, taking facts from WP No.35796 of 2024. The petitioner was assessed for Assessment Year 2013–2014, and an assessment order dated 18.05.2022 determined attributable income in India at 10%. Subsequently, a notice dated 16.06.2023 under Section 263 of the Income Tax Act, 1961 proposed revision of the percentage to 25%.
Earlier writ petitions challenging the Section 263 notice were withdrawn with liberty to avail the Direct Tax Vivad Se Vishwas Scheme, 2024 (“Scheme of 2024”). The petitioner filed an online application under Section 91 of the Scheme of 2024 after paying the requisite amount. According to Part-F of the application, an auto-generated amount of ₹2,07,58,934/- was refundable. However, the petitioner received a rejection order titled “rejection remarks,” stating that the disputes and taxes had been settled under the DTVSV 2020 scheme and that DTVSV 2024 does not override DTVSV 2020, hence Form-1 was rejected.
The petitioner contended that the rejection remarks were not properly worded and were cryptic. It was argued that Section 90 of the Scheme of 2024 contains a non-obstante clause giving it overriding effect over the Income Tax Act and any other law in force, including the Scheme of 2020. Reliance was placed on Section 94(2) to contend that tax is refundable if conditions are satisfied. The petitioner further argued that the counter-affidavit filed by the department sought to supplement the rejection order with new reasons, which is impermissible in view of the Constitution Bench decision in Mohinder Singh Gill.
