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Relief to Deepak Kochhar: Supreme Court dismisses Income Tax Department’s plea from Reassessing NuPower Renewables

The two-Judge Bench of the Supreme Court of India has dismissed the Income Tax Department’s plea from reassessing Deepak Kochhar and NuPower Renewables.

The income tax department sought to reopen the accounts of NuPower last year to examine the genuineness of investments of about Rs 50 crore by Firstland Holdings in 2011. NuPower is being investigated for receiving quid pro quo investments for loans sanctioned to various industrial houses by ICICI when she was at the helm of aairs. The tax department wanted to investigate the investment of Rs 49.9 crore by Mauritius-based Firstland Holdings in NuPower through the purchase of convertible preference shares in 2010-11. In mid-2018, the department claimed the source, genuineness and creditworthiness of Firstland Holdings remain unexplained and needed further investigation. The revenue department also claimed NuPower had not fully and truly disclosed all material facts necessary for assessment. NuPower challenged the department’s move in Bombay High Court on December 12, 2018. It argued that the reopening notice was time-barred since it was issued beyond the permissible period of four years. “Without there being any new or additional material, reopening assessment on the basis of the said ground is not permissible.” The company argued that the information was not new for the assessing ocer. “Through a series of correspondence between the assessee and assessing ocer, this information was highlighted time and again,” the company said in its response. “The channel of movement of the fund, the source of the fund, purpose of investment and ultimate destination of the fund, were all part of the record during the assessment proceedings. There is nothing in the reason recorded by the assessing ocer to suggest that such investment is bogus.”

To Read the full text of the Order CLICK HERE