Disposed

Leighton India Contractors Pvt.Ltd v. the Union of India Ministry of Law and 2 Ors.

Bombay HC18 Nov 2014WP/732/2014

Case brief

AI extract

What is this about?

The Bombay High Court declined to entertain a writ petition regarding taxability of share issue income. Relying on Vodafone-IV and noting pending DRP objections, the court directed the DRP to decide based on the agreement that no income arises from such transactions.

What did the court decide?

Petition disposed with directions for DRP to decide objection in light of Vodafone-IV agreement.

Leighton India Contractors Pvt.Ltd Vs the Union of India Ministry… — Income Tax | Bombay HC (2014)

ASN

1/2

WP-732

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

¶5

WRIT PETITION NO.732 OF 2014

¶6

Leighton India Contractors Pvt. Ltd. vs.

¶7

The Union of India and ors.

¶8

...Petitioner.

¶9

...Respondents.

¶10

Mr. Percy Pardiwala, Senior Counsel along with Ms. Megha Bansal and Mr. J.S.Sanghavi i/by PDS Legal for the Petitioner. Mr. Tejveer Singh for the Respondents.

¶11

CORAM : M. S. SANKLECHA AND S.C. GUPTE, JJ. DATE : 18 NOVEMBER, 2014

¶12

PC:

¶13

The issue arising in the present petition relating to A.Y.2010-11 is whether the issue of equity shares by the petitioner to its non resident Associated Enterprises and the conversion of its preference shares held by the non resident Associated Enterprises into equity shares would attract the provisions of Chapter X of the Income Tax Act, 1961. (“the Act”).

¶14

It is agreed between the Counsel that the above issue stands covered in favour of the petitioner by virtue of the decision of this Court in Vodafone India Services Pvt. ltd. vs. Union of India 368 ITR Page 1 (Vodafone IV).

¶15

This petition challenges the order dated 27 January 2014 of the Transfer Pricing Officer passed under Section 92CA(3) of the Act and also the Draft Assessment Order (served upon the petitioner on 2 April 2014). By the impugned orders it has been held that there is a short fall in the amounts

ASN

2/2

WP-732

received on issue of equity shares and conversion of Preference shares into equity shares when benchmarked against the Arms Length Price (ALP) to be received on issue and conversion. This short fall is characterized as income arising from International Transactions and is being subjected to tax for Assessment Year 2010-11.

¶20

We are informed that the petitioner has also filed objection to the draft assessment order before the Dispute Resolution Panel (DRP) and we are also informed that the hearing of the petitioner's objection is scheduled before the DRP on 24 November 2014. The petitioner is not withdrawing its application before the DRP as there are other issues being urged before it.

¶21

In the above view, we see no reason to entertain this petition. However, it goes without saying that the DRP will decide the petitioner's objection in the light of agreed position between the parties in the present facts to the effect that no income would arise in respect of issue of equity shares to non residential share holder and the conversion of preference shares into equity shares held by the non resident Associated Enterprise in view of Vodafone -IV.

¶22

Petition is disposed of with the above directions. No order as to

¶23

costs.

¶24

(S.C. GUPTE, J.)

¶25

(M.S. SANKLECHA, J.)

Leighton India Contractors Pvt.Ltd v. the Union of India Ministry of Law and 2 Ors.

Case brief

What is this about?

What did the court decide?

Leighton India Contractors Pvt.Ltd v. the Union of India Ministry of Law and 2 Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Gkn Sinter Metals Ltd. Vs Ms. Ramapriya Raghavan the Assistant Commissioner of Income Tax Circle 2 (1) Mumbai

Royal Connaught Boat Club Vs Income Tax Officer, Ward 2(2), Pune and Ors.

M/S. Cannon Industries Pvt. Ltd. and Anr. Vs the Income Tax Officer Ward 1 (I) (2) Mumbai and 2 Ors.

Shell India Markets Pvt. Ltd. Vs Union of India and Ors.

Shri. Damodar Badrinarayan Bhandari and Anr. Vs the Director General of Income-Tax (Investigation) and Ors.

Essar Power Limited Vs Union of India Ministry of Law and Ors.