TaxTMI 
TaxTMI 
2025 (5) TMI 1333
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....l appearing for the Revenue accepts notice. 3. The petitioner has filed the present petition, inter alia, impugning a notice dated 21.03.2024 [impugned notice] issued under Section 148 of the Income Tax Act, 1961 [the Act] as well as the consequential proceedings under Section 147 of the Act in respect of Assessment Year [AY] 2018-19. 4. It is the petitioner's case that the impugned notice was issued beyond the period of limitation as prescribed under Section 149 (1) (a) of the Act. Therefore, the impugned notice and further proceedings pursuant thereto are liable to be set aside. 5. The impugned notice was issued pursuant to a search conducted on 21.03.2023 in the premises of the petitioner and other connected entities. 6. The ....
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....een that it has paid huge amount of management fee to Idemia France and other AES during the period FY 2016-17 to 2022-23. The management and IT services availed were primarily in context of management support services (executive management, strategic development, finance control, accounting, purchasing etc.) and Information Technology services (maintenance of IT infrastructure etc.). The quantum of management fees paid by IISPL are tabulated below: (In Rs. Cr.) FY/Name 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 Grand Total Idemia France SAS 0.09 0.13 0.15 0.32 0.21 0.89 Idemia Identity & Security France SAS 1.00 0.42 0.....
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....rch, various incriminating evidences have been found and statements have been recorded which revealed that IISIPL is making substantial payments to AEs as "Management and IT Cost" and such payments are being made without any justification and proper calculation. Some of the instances of incriminating emails found which shows that management fee was merely used as conduit to shift profits outside India are discussed as under: Email dated 02.12.2021 sent by Cecile Daburon Duong (Director of Idemia India) to Mr. Akhil Bansal (Tax-Head) and Mr. Rajeev Kachhal (CFO) having 'subject: True up on management fees'. In the said email, it was discussed that management fees charged on previous year estimate and not on actual basis; par....
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....ved by Idemia India. That is why it was discussed by Cecile (Director, Idemia India) to remove management fees in order to avoid scrutiny by tax authorities. Further, it has been discussed to increase markup on purchases to 15% in lieu of management fees removed (as evident from 'My feeling is that we should be able to reach 15% and remove 150M of management fees in the first year'). Hence, it can be inferred that margin on purchases were mere tools to shift profits outside India and limit payment of taxes in India. In the case of IISPL also, no management services have actually been received by IISPL. No actual benefit qua the management services was being provided by Idemia France. The payment of management fees was merel....
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.... fees was being charged. Even the top management was not able to justify the huge management cost and the same do not commensurate with the operations in India. Thus, the management and operational cost is nothing but just a conduit to shift the profits out of India. As discussed above, it is established that management, IT and other intra-group expenses amounting to Rs. 0.42 Crores during the period FY 2017-18 relevant to AY 2018-19 were merely used as a manipulative tool to shift profits outside India and no actual services were being received by Idemia India." 8. There is no cavil that the amount alleged to have escaped assessment during the relevant assessment year is less than Rs. 50,00,000/- (Rupees fifty lacs) an....