Tag: INCOME TAX APPELLATE TRIBUNAL

Cummins India Secures ₹210 Crore Tax Relief as ITAT Rules in Favour financial year 2017–18

Power solutions major Cummins India Ltd on Friday (December 19) announced that the Income Tax Appellate Tribunal (ITAT) has passed a favourable order for the financial year 2017–18, granting tax relief amounting to ₹210.29 crore.

According to the company, the ITAT, in its order dated December 4, 2025, directed ₹13.11 crore of the disputed amount back to the Assessing Officer for revalidation, while upholding a disallowance of ₹0.48 crore. Cummins India said it is currently reviewing the order and evaluating possible next steps with respect to the disallowed amount.

The case relates to long-pending litigation with the Income Tax Department and had earlier been disclosed to stock exchanges in August 2023 and December 2023.

Cummins India clarified that the disclosure is based on a copy of the ITAT order downloaded from the tribunal’s official website, as the physically signed order is yet to be received. The company added that its internal teams are analysing the financial and accounting implications of the ruling.

Following the announcement, shares of Cummins India Ltd closed at ₹4,402.30 on the BSE, rising ₹16.90 or 0.39%

Income Tax tribunal quashes Rs 445 crore tax demand against Netflix India

Income Tax tribunal quashes Rs 445 crore tax demand against Netflix India. In a big relief to Netflix India, the Income Tax Appellate Tribunal (ITAT), Mumbai, has dismissed a Rs 445-crore tax demand against it, and rejected the tax department’s attempt to recharacterise Netflix Entertainment Services India LLP as a full-fledged content provider. The tax demand pertains to the assessment year 2021–22.

A Bench comprising Amit Shukla and Renu Jauhri held that Netflix India operates merely as a limited-risk distributor of access to the global Netflix streaming service, rather than as an entrepreneurial content-and-technology service provider as alleged by the transfer pricing officer (TPO) and the Dispute Resolution Panel (DRP).

The Tribunal examined the distribution agreement between Netflix India and its associated enterprises (AEs) and found the tax department’s inference to be internally inconsistent. It noted that the very paragraph cited by the TPO “begins by recognising that Netflix India does not get access to content yet ends by concluding that it does.”

Calling this a “perverse appreciation of record and an outcome-driven approach,” the ITAT said such contradictions undermined the department’s case.

The Tribunal observed that Netflix India’s activities are limited to promotion, distribution of access, invoicing, local customer support, and regulatory compliance. It holds no intangible assets, and its risks are confined to routine operational and regulatory exposures, all fully indemnified by its AEs. The entity earned a return on sales (ROS) of 1.36 percent, consistent with its low-risk, cost-insulated distributor profile.

The ITAT also observed that Netflix India’s employees are not involved in content acquisition, technology design, or platform development, but only in marketing and operations support.

Rejecting the Revenue’s contention that Netflix India “obtains content and technology on licence,” the ITAT said this was inconsistent with the TPO’s own earlier finding that the Indian entity “does not get access to content.”

The Tribunal held that attributing 43 percent of global subscription revenue to an entity that neither owns nor develops the underlying content or technology “violates the symmetry between function, asset, and risk — the triad that defines economic ownership.”

The ITAT concluded that Netflix India performs only routine distribution and marketing support functions under close supervision of its AEs, owns no valuable intangibles, and undertakes no DEMPE (development, enhancement, maintenance, protection, and exploitation of intangibles) functions. Accordingly, its profitability benchmark under TNMM reflected an arm’s-length outcome.

The tribunal thus deleted the Rs 445 crore transfer pricing adjustment, ruling fully in favour of the assessee.

‘itat e-dwar’, an e-filing portal of Income Tax Appellate Tribunal launched

Shri Ravi Shankar Prasad, Union Minister for Law & Justice, Communications and Electronics & IT, formally launched the e-filing portal of Income Tax Appellate Tribunal (ITAT), ‘itat e-dwar’,on the 25 June 2021 in New Delhi. The newly developed e-Filing Portal would enable the parties to file their Appeals, Miscellaneous Applications, documents, paper books, etc., electronically. 

The Minister detailed how during the pandemic and the lockdown that ensued the Judiciary functioned through digital means and heard more than one crore cases.  He stated that data about more than 18 crore cases are available in the National Judicial Data Grid (NJDG) and he suggested that cases of ITAT should also be integrated in the NJDG. He pointed out that VC facility has been provided in more than 800 jails so that the undertrials are able to appear before the Courts without the police having to bring them physically to the courts.

He further cautioned that this initiative of ITAT must not be seen as a solitary step.  Instead, it should be seen as a larger narrative of transformation that the country is undergoing through digital medium.  It enables innovation and empowerment and opens new avenues for growth.  He expressed hope that ‘itat e-dwar’ will be widely accepted by the lawyers and tax litigants alike.

On this occasion, a virtual function was organized at the national level which was attended by the functionaries of ITAT from all the 28 stations.  The members of various Bar Associations also joined the virtual function.  It was also attended by the Officers of the Income Tax Department, Chartered Accountants, Taxpayers and other legal luminaries in the field of tax, from across the country.

Justice P.P. Bhatt, President of ITAT, on this occasion, informed the gathering that the launch of e-Filing Portal ‘itat e-dwar’ will enhance the accessibility, accountability and transparency in the day to day working of the ITAT.  It would not only result in economization of the use of paper, savings in costs but also rationalization of the fixation of cases leading to quicker disposal of cases.  On this occasion, Justice Bhatt also announced a plan to set up paperless courts in the ITAT with a pilot project being undertaken at Delhi Benches of ITAT.  It was also informed that even during the period of Pandemic, by using the tools of information and communication technology, various benches of ITAT have functioned and kept up its activity of judicial dispensation.  It was revealed that in spite of the restricted functioning of Benches, the adoption of Video Conferencing has brought down the pendency of cases to about 64,500 as against 88,000 on 1st April, 2020.

On this occasion, Shri Anoop Kumar Mendiratta, Union Law Secretary also addressed and congratulated the ITAT for the initiative taken by it developing the new e-Filing Portal.  Shri G.S. Pannu, Vice President (Delhi Zone) and Chairman, Computerization Committee, ITAT explained that with the combination of digital court room, virtual hearings and Mobile Application providing Judicial Information, paperless courts will soon be a reality in ITAT.

Income Tax Appellate Tribunal (ITAT): A Success Story

Ex-president of Income Tax Appellate Tribunal (ITAT) Sh. Vimal Gandhi written an article on “Income Tax Appellate Tribunal (ITAT): A Success Story”.

In his article, he mentioned:

I am very happy and grateful to the Honourable President and other organizers for having invited me to join in Platinum Jubilee celebrations of the Income Tax Appellate Tribunal completing 75 glorious years. I have also been asked to write a message for the Souvenir to be released on the auspicious day. I take it as my proud privilege.

The setting up of the ITAT brought about a paradigm shift in the grievance redrassal system. ITAT ensured complete functional independence of the institution, a high degree of legal and technical expertise of the members manning the Benches, user friendly, simple and informal procedures and
inexpensive and quick delivery system. Naturally, with above characteristics particularly of delivery of quick and easy justice with openness in its working, made Tribunal very popular right from the start. It was able to win confi dence of the people as also of Revenue because everything became easy and less time consuming. Over the period, the Tribunal streamlined its procedure by formulating rules and by evolving conventions to make its working smooth and friction free. This good working raised Tribunal’s image higher and higher.

I, on this occasion, wish the Tribunal a glorious future.

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