| Case ID |
0bb9507d-88f0-4c12-9ddd-5d8957363926 |
| Body |
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| Case Number |
WRIT PETITION No. 359 OF 1994 |
| Decision Date |
May 07, 2009 |
| Hearing Date |
|
| Decision |
The court held that the reasons provided by the assessee for failing to remit the complete amount of foreign exchange within the stipulated time were due to circumstances beyond their control. The application for extension of time to bring in the foreign exchange was deemed valid, and the previous order by the Commissioner rejecting the application was set aside. The case was remanded back to the Commissioner for reconsideration with an opportunity for the petitioner to present relevant documents. This decision emphasized the importance of fair assessment regarding foreign exchange remittance under Section 80HHB of the Income Tax Act. |
| Summary |
In the case of Petron Engineering Construction Ltd. vs. Commissioner of Income Tax, the Bombay High Court addressed the issue of foreign exchange remittance under Section 80HHB of the Income Tax Act, 1961. The petitioner, Petron Engineering, had entered into a contract with a foreign entity for providing erection and commissioning services. They were required to remit 50% of the profits in convertible foreign exchange within six months to qualify for a tax deduction. However, due to unforeseen circumstances involving additional work that led to a delay, they failed to comply with this requirement within the given timeframe. The Commissioner of Income Tax rejected their request for an extension, leading to the petition. The court ruled that the reasons provided for the delay were valid and remanded the case back to the Commissioner for a proper evaluation, allowing Petron to submit necessary documentation. This case highlights the complexities surrounding tax regulations and foreign project execution, emphasizing the need for flexibility in compliance amid unforeseen operational challenges. |
| Court |
Bombay High Court
|
| Entities Involved |
Petron Engineering Construction Ltd.,
Commissioner of Income Tax, Bombay VI
|
| Judges |
F.I. Rebello,
J.H. Bhatia
|
| Lawyers |
Ms. Asifa Khan for the Appellant,
J.S. Saluja and P.S. Sahadevan for the Respondent
|
| Petitioners |
Petron Engineering Construction Ltd.
|
| Respondents |
Commissioner of Income Tax, Bombay VI
|
| Citations |
2009 SLD 967,
(2009) 318 ITR 388,
(2010) 187 TAXMAN 212
|
| Other Citations |
Azad Tobacco Factory (P.) Ltd. v. CIT [1997] 225 ITR 1002,
Geekay Exim (India) Ltd. v. CIT [1998] 234 ITR 560,
Narinder Kumar Arora v. CIT [2000] 245 ITR 10,
CIT v. Ajanta Electricals [1995] 215 ITR 114
|
| Laws Involved |
Income Tax Act, 1961
|
| Sections |
80HHB
|