More Stories

Informist, Thursday, Jul. 3, 2025

 

By Surya Tripathi

 

--HC junks income tax dept's notices to reopen BPCL's income assessment

 

NEW DELHI – The Bombay High Court on Thursday quashed the income tax department's notices to reopen the income assessment of Bharat Petroleum Corp. Ltd for assessment years 2013-14 and 2014-15. The assessing officer had said that Bharat Petroleum's income to the extent of INR 371.00 million and INR 2.02 billion had escaped assessment for the years 2013-14 and 2014-15, respectively.

 

"...we find that the assessing officer, after relying upon the data already furnished by the assessee during the original scrutiny proceedings under Section 143(3) (of the Income Tax Act, 1961), comes to the conclusion that income has escaped assessment," said the high court. There was no failure on the part of Bharat Petroleum to disclose fully and truly all material facts in relation to the deduction claimed under Section 32AC of the 1961 Act for the assessment year 2014-15. 

 

The high court said, "...we are clearly of the view that there was no failure to disclose fully and truly all material facts in relation to AY(assessment year) 2013-14, which would invest the 1st respondent(Assistant Commissioner of Income Tax) with the jurisdiction to initiate reassessment proceedings under Sections 147 and 148 of the IT(Income Tax) Act". The courts have clearly laid down that where scrutiny assessments are done under section 143(3) of the 1961 Act and more than four years have elapsed from the end of the relevant assessment year, then no reassessment proceedings can be initiated unless there is a failure on the part of the assessee to fully and truly disclose all material facts for that assessment year, said the high court. 

 

For the assessment year 2013-14, Bharat Petroleum had claimed exemption, under Section 10(34) of the 1961 Act, of INR 1.79 billion on account of dividend income. Out of this total income claimed as exempt by the petitioner, an amount of INR 371.00 million was on account of receipts from an entity called Bharat Petroleum Corp. Ltd. Trust for investment in the latter's shares. According to the assessing officer, it is from this Trust that Bharat Petroleum had received dividend income to the tune of INR 371.00 million. The tax department had said that the amounts distributed by the Trust to the petitioner did not qualify as exempt income and full and true facts relating to the earning of such income were not disclosed by Bharat Petroleum for 2013-14. 

 

For the assessment year 2014-15, the income tax department said that the assessment was reopened against the petitioner on the ground that the company had incorrectly claimed exemption under Section 10(34) of the 1961 Act in relation to the monies received from the Trust. Further, Bharat Petroleum had also wrongly claimed a deduction under Section 32AC of the 1961 Act, said the tax department.

 

On Thursday, the shares of Bharat Petroleum Corp. Ltd. ended flat at INR 331.50 on the National Stock Exchange.  End

 

Edited by Vandana Hingorani

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2025. All rights reserved.