This article provides an in-depth analysis of the tax dispute between Asia Satellite Telecommunications Co. Ltd. and the Deputy Commissioner of Income Tax, Circle-1(1)(1), International Taxation, New Delhi, concerning the assessment year 2015-16. The case, ITA No. 4771/Del/2019, was settled through the Direct Tax Vivad Se Vishwas Act, 2020, aiming to reduce litigation and promote a tax compliance culture.
The dispute originated from a disagreement over tax liabilities for the assessment year 2015-16, leading Asia Satellite Telecommunications Co. Ltd. to appeal against the order of the CIT(A)-42, New Delhi dated March 30, 2019. The appeal was driven by the need to address complexities in international tax issues faced by the company.
In an effort to resolve ongoing tax disputes, Asia Satellite Telecommunications opted for the Vivad Se Vishwas Scheme, 2020, which provides a mechanism for companies to settle tax disputes out of court by paying a percentage of the disputed tax amount. This move was aimed at reducing litigation and ensuring peace of mind for the company.
The tribunal, led by Shri G.S. Pannu, Vice President, and Shri Kul Bharat, Judicial Member, acknowledged the company’s request to withdraw the appeal pursuant to its decision to opt for the Vivad Se Vishwas Scheme. The request was accepted, leading to the dismissal of the appeal on April 30, 2021, as both parties agreed to the terms set forth by the scheme.
The resolution of this case highlights the Indian government’s efforts to attract foreign investment by simplifying tax dispute resolution and reducing the compliance burden on international companies. It serves as a precedent for other multinational corporations facing similar tax disputes in India, underlining the effectiveness of alternative dispute resolution mechanisms in the realm of international taxation.
The dismissal of ITA No. 4771/DEL/2019 represents a significant step towards fostering a more business-friendly tax environment in India, encouraging other companies to consider similar approaches to resolving tax disputes.
Manage the increasing number of hearings effortlessly by leveraging the legal AI revolution We are India's Leading revolutionary AI-powered legal platform where you can get enough insights into top cases and judgements.
Research Platform