May 2019

Sections 147 and 148 – Reassessment – Notice after four years – Validity – Transfer of assets to subsidiary company and subsequent transfer by subsidiary company to third party – Transaction disclosed and accepted during original assessment – Notice after four years on ground that transaction was not genuine – Notice not valid

K. B. Bhujle
Advocate

10. Bharti Infratel Ltd. vs. Dy. CIT; 411 ITR 403 (Delhi): Date of order: 15th January, 2019 A.Y.: 2008-09

 

Sections 147 and 148 – Reassessment – Notice after four years – Validity – Transfer of assets to subsidiary company and subsequent transfer by subsidiary company to third party – Transaction disclosed and accepted during original assessment – Notice after four years on ground that transaction was not genuine – Notice not valid

 

BAL transferred telecommunications infrastructure assets worth Rs. 5,739.60 crores to the assessee, its subsidiary (BIL), on 31.01.2008 for Nil consideration under a scheme of arrangement approved by the Delhi High Court. According to the scheme of arrangement, BIL revalued the assets to Rs. 8,218.12 crore on the assets side of the balance sheet for the year ending 31.03.2008. Within 15 days of the approval of the scheme of arrangement, a shareholders’ agreement on 08.12.2007 was entered into by BIL whereby the passive infrastructure was transferred by it to a third party, namely, I. The return for the A.Y. 2008-09 was taken up for scrutiny assessment by notices u/s. 143(2) and 142 of the Income-tax Act, 1961. Questionnaires were issued to which BIL responded furnishing details and documents. Assessment was made. Thereafter, reassessment proceedings were initiated and notice u/s. 148 issued on 01.04.2015.

The assessee filed a writ petition and ch

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