TelecomLive January-2019

Legal Watch www.telecomlive.com 45 Telecom LIVE January 2019 department to expeditiously process its claim for refund of over Rs 4,759 crore in respect of returns filed for the assessment years (AYs) 2014-15 to 2017-18. A bench of Justices S Ravindra Bhat and Prateek Jalan declined to grant any relief to the company, saying there was merit in the tax depar tment ' s argument that substantial outstanding demand was pending against the company and there was likelihood of more demands being made after the assessment for the AYs in question were scrutinised. The court noted that assess- ments for the years in question were either facing special audit or pending before the Assessment Officer (AO) for scrutiny and since scrutiny assessment of earlier years had led to raising of substantial demand, the tax department had decided not to process the com- pany's returns. "The petitioner has undertaken two schemes of amalgamation involving merger of certain group companies in order to restructure i t s bus ines s opera t i ons and increase operational efficiencies. In light of the above fact, assess- ments for the AY 2012-13 and 2013- 14 are under special audit and any demand that would arise from the processing of the said assessment years are to be allowed to be adjus t ed aga ins t the re fund claims," it said. The company had claimed that it had received an acknowledgement after it had filed a return and therefore, within a year of the same, the refund ought to have been processed and failing which, interest would be applicable. Rejecting the contention, the court said, "Intimation or acknowl- edgement cannot confer any greater right than for the assessee to ask the AO to process the refund andmake over themoney." "It is up to the AO, wherever the possibility of issuing a notice under Section 143 (2) exists, or where such notice has been issued, to apply hismind, and decide whether given the nature of the returns and the potential or likely liability, the refund can be given. It does not mean that when an assessment - pursuant to notice under Section 143 (2) is pending, such right to claimrefund can accrue." Madras HC stays I-T demand notices on Aircel, Dishnet Wireless The Madras High Court has kept in abeyance the notices issued by the Income Tax department to Dishnet Wireless Ltd and Aircel Ltd for payment of Rs 32.24 cr and Rs 7,540 cr respectively for the year 2010-11 towards non-deduction of TDS on the payment of foreign remittances. Justice T Raja directed the I-T department to keep in abeyance the Mar 31, 2018 proceedings conse- quent to the demand notices issued on Mar 2, 2018 till the disposal of their applications for bankruptcy pending be fore the Nat i ona l Company Law Tribunal (NCLT) bench. The two companies submitted that they were involved in cellular mobile services and the I-T depart- ment served notice on them under section 201(1) and 201(A) of the Income Tax Act for alleged failure to deduct TDS on certain foreign remittances. Even though they sought time to comply with the notice in view of their applications for bankruptcy pending before the NCLT bench, I-T department initiated further proceedings onMar 31, 2018. SC issues notice on RCom's appeal on refund of unspent prepaid balance The Supreme Court has sought a response from Trai on an appeal by RCom challenging an order of the TDSAT directing it to refund the unspent prepaid balance to its prepaid mobile subscribers. These included those prepaid subscribers who opted for porting and also thosewho could not port or who did not wish to port their numbers before disconnection of service. RComargued that Trai could not have directed for the refund in the absence of any law or regulations on this. The plea stated that a total amount of Rs 8.1 crore was the unspent prepaid balance of 4.9 crore customers who did not opt for porting despite ample notices given byRCom. On Nov 29 , 2018 , TDSAT dismissed RCom's plea challenging a series of Trai's directions on the grounds of limitation andmerit.