Platex Limited V. Assistant Director of Income Tax (International Taxation), A.C. Guards, Hyderabad and another

WP/3550/2013

AI Insights

M/s. Platex Limited, a foreign company incorporated in Mauritius, challenged an order from the Income Tax Appellate Tribunal, Hyderabad, which granted a stay on an outstanding tax demand but conditioned it on the payment of Rs. 2,00,00,000. This demand was part of a larger tax assessment of Rs. 29,35,68,360 for the assessment year 2008-09, which was initially assessed against M/s. PVP Ventures (P) Limited, an Indian representative of the petitioner. The Commissioner of Income Tax (Appeals) had set aside the assessment against the Indian company, suggesting the tax should be collected from the petitioner on a protective basis. Both the Department and the petitioner appealed this decision. The court found no grounds to interfere with the Tribunal's decision and dismissed the writ petition, urging the Tribunal to resolve the pending appeals swiftly.

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 796413 (HC-HYDERABAD)
• Appeal Type: Others
• Pronouncement Date: 11-02-2013
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: J V PRASAD
• Assessee Lawyers: N VIJAY
• Keywords: Assessment Year 2008-09; Foreign company; Income Tax; International Taxation; Shell company; Stay Application
• Section: 201/HYD/2012; 1868/HYD/2011

Judgement Text

"HON’BLE SRI JUSTICE V. ESWARAIAH & HON’BLE SRI JUSTICE K.G. SHANKAR WRIT PETITION No.3550 OF 2013 Dated: 11th February, 2013 Between: M/s. Platex Limited … Petitioner And Assistant Director of Income Tax (International Taxation) , A.C. Guards, Hyderabad and another … Respondents ORDER : ( per Hon’ble Sri Justice V.Eswaraiah ) The petitioner-M/s.Platex Limited, a foreign company incorporated under the laws of Mauritius, questions the order dated 07-12-2012 passed in S.A.No.201/HYD/2012 in ITA No.1868/HYD/2011 by the Income Tax Appellate Tribunal, Hyderabad Bench ‘A’, Hyderabad, granting stay of outstanding demand amount of Rs.29,35,68,360/- for the assessment year 2008-09, pending disposal of the appeal filed by the petitioner, subject to condition the petitioner pays an amount of Rs.2,00,00,000/- on or before 31-12-2012. Aggrieved by the condition imposed to pay a sum of Rs.2 Crores, the present writ petition is filed. 2. Sri Siva Raman, learned counsel appearing for learned counsel for the petitioner Sri N.Vijay submits that the representative company of the petitioner company in India i.e., M/s.PVP Ventures (P) Limited has been assessed in representative capacity of the petitioner company for the assessment year 2008-09 demanding a sum of Rs.29,35,68,360/- and as against the said order, the representative company i.e. M/s. PVP Ventures (P) Limited has filed an appeal before the Commissioner of Income Tax (Appeals) and the Commissioner of Income Tax (Appeals) by its order dated 29-06-2010 set aside the assessments in the hands of the Indian company holding that the assessment ought to have been made in the hands of the petitioner on protective basis. It is stated that as against the said order of the Commissioner of Income Tax (Appeals), the Department also filed appeal before the Income Tax Appellate Tribunal and as a precautionary measure assessed the tax in the hands of the petitioner demanding to pay a sum of Rs.29,35,68,360/-. The petitioner has also filed appeal before the Income Tax Appellate Tribunal vide ITA No.1868/HYD/2011 and pending disposal of the appeal, the petitioner filed stay application and by the impugned order the Income Tax Appellate Tribunal, Hyderabad, granted stay subject to the condition of depositing Rs.2.00 Crores. 3. It is contended by the learned counsel appearing for the petitioner that the Department cannot collect the said tax and ultimately it has to collect the said tax from M/s. PVP Ventures (P) Limited on the substantive basis and also in view of the fact that the appeal filed by the Department and the present appeal filed by the petitioner are pending before the Income Tax Appellate Tribunal, Hyderabad. 4. On the other hand, Sri J.V.Prasad, learned Standing Counsel for Income Tax Department submits that the assessment in question is made on the substantive basis as a representative capacity. The petitioner in the hands of the M/s. PVP Ventures (P) Limited has been rightly set aside by the Commissioner of Income Tax (Appeals). However, as a precautionary measure the appeal has been filed and it is stated that the petitioner alone is liable to pay the demanded tax. It is further stated that the petitioner is a foreign company registered under the laws of Mauritius and it is Shell Company and in fact the Income Tax Appellate Tribunal liberally granted stay putting a condition of depositing Rs.2.00 Crores as against the demand of Rs.29.00 Crores and odd. It is further stated that the said order cannot be said to be onerous, unreasonable or arbitrary. 5. In view of the facts and circumstances of the case, we do not see any merits in the writ petitioner and it is according dismissed. Inasmuch as it is stated the appeals are posted on 09-04-2013, we request the Income Tax Appellate Tribunal, Hyderabad, to hear and dispose of the appeals expeditiously without any undue delay. Miscellaneous petitions if any pending in this writ petition shall also stand dismissed. No order as to costs. ______________________ V. ESWARAIAH, J ______________________ K.G.SHANKAR ,J Dated: 11-2-2013 sNrg /Mva HON’BLE SRI JUSTICE V. ESWARAIAH & HON’BLE SRI JUSTICE K.G. SHANKAR WRIT PETITION No.3550 OF 2013 Dated: 11th February, 2013 Nrg "