Vodafone – Bombay HC writ under Article 226
The Bombay HC dismissing the Vodafone plea has held as follows:
- Article 226 gives limited jurisdiction to intervene after an order is passed by a TP officer.
- DRP has wide powers to go into international transactions. Further the tax payer’s right to challenge an assessment order (before DRP) is for challenging the entire order and not portions of order.
- The TP officer cannot determine whether a particular transaction is an international transaction or not. He can merely determine the arms length price.
- Vodafone had obtained a stay restraining the Department from serving the order. To that, the HC has extended the stay period to 12 weeks to enable Vodafone to approach the SC
The HC, considering Vodafone facts, has come to the conclusion that an alternate remedy to file an appeal with the Tribunal and/ or pursue with DRP is available under the Income tax law and hence, writ petition will not be entertained. In coming to the conclusion, it has held that once an order is passed by a TP officer, alternate remedy available under the administrative law has to be resorted to.
Mukesh Butani is Founder & Managing Partner of BMR Legal Advocates, a boutique law firm specializing in the areas of Corporate International Tax, Transfer Pricing, GST, Customs & Trade, with expertise in litigation services, controversy management, strategic transaction advisory and policy. With specialization in domestic corporate international tax and transfer pricing, he has over three decades of experience in advising multinationals and Indian conglomerates on wide range of matters relating to FDI policy, business re-organizations, cross-border tax structuring, tax controversy and regulatory policy. He is an acknowledged expert in the area of International Tax policy, controversy & advocacy, and has to his credit several landmark judicial pronouncements. He has deposed as Expert Witness on contentious cross-border tax treaty & TP matters in foreign jurisdictions. Mukesh is a qualified Chartered Accountant and holds bachelor's degree in Commerce and Law, and practices as an Advocate before various Tribunals, High Courts and the Supreme Court of India.