Gujarat High Court
Commissioner Of Income Tax ... vs Adani Wilmar Ltd on 8 September, 2025
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
NEUTRAL CITATION
C/TAXAP/177/2024 ORDER DATED: 08/09/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/TAX APPEAL NO. 177 of 2024
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COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION AND
TRANSFER PRICING)
Versus
ADANI WILMAR LTD.
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Appearance:
MS MAITHILI D MEHTA(3206) for the Appellant(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
Date : 08/09/2025
ORAL ORDER
(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)
1. This Tax Appeal is filed under Section 260A of the Income Tax Act, 1961 (for short 'the Act') proposing the following substantial question of law arising out of order dated 11.8.2023 passed by the Income Tax Appellate Tribunal "D" Bench, Ahmedabad in ITA No. 1/ Ahd/2022 for Assessment Year 2011-12 and the questions are:
"A. Whether on the facts and circumstances of case, the Hon'ble ITAT has erred in law and on facts of the case in coming to the conclusion that Section 206AA of the Income Tax Act, 1961 does not override the provisions of section 90(2) of the Act, despite the Page 1 of 4 Uploaded by SAJ GEORGE(HC01069) on Fri Sep 12 2025 Downloaded on : Sat Sep 13 04:31:13 IST 2025 NEUTRAL CITATION C/TAXAP/177/2024 ORDER DATED: 08/09/2025 undefined fact that section 206AA of the I.T. Act starts with a non-obstante clause?
B. Whether the Hon'ble ITAT has erred in law and on facts of the case in ignoring the memorandum explaining the provisions of the Finance (No.2) Bill, 2009 which clearly states that Section 206AA of the Income Tax Act, 1961 applies to Non- Residents and also ignoring the press release of Central Board of Direct Taxes (CBDT) No. 402/92/2006-MC (04 of 2010) 1 dated 20.01.2010 which reiterates that Section 206AA of the Income Tax Act will also apply to all Non-Residents in respect of payments/remittances liable to TDS where PAN is not provided to the deductor ?
C. Whether the Hon'ble ITAT erred in law and on facts in concluding that Section 206AA of the Income Tax Act, 1961, which provides a higher tax at the rate of 20% in the event of foreign entity not obtaining the Permanent Account Number (PAN) in India cannot be pressed into service to impose obligation on the Non- Residents to obtain PAN?"
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2. Learned Senior Standing Counsel Ms. Maithili Mehta for the appellant submitted that similar questions have already been considered in case of respondent in Tax Appeal No. 514 of 2024 and allied matters by dismissing the appeal of the revenue.
3. In view of the above submissions and considering the fact that similar appeals being Tax Appeal No. 514 of 2024 and other allied matters having been dismissed on the similar questions of facts in the case of the respondent-
Assessee wherein it is held as under:
"11. In view of above dictum of law and considering the facts of the case, the respondent assessee has deducted the tax at source on payment made to non residents on account of royalty and/or fees for technical services at the rates prescribed in respective DTAAS between India and respective countries of non residents and such rate of tax being lower than rate of 20% as provided under Page 3 of 4 Uploaded by SAJ GEORGE(HC01069) on Fri Sep 12 2025 Downloaded on : Sat Sep 13 04:31:13 IST 2025 NEUTRAL CITATION C/TAXAP/177/2024 ORDER DATED: 08/09/2025 undefined section 206AA of the Act, CIT (Appeals) and the Tribunal have rightly arrived at concurrent findings to the effect that as per section 90(2) of the Act, the provisions of DTAA would override the provisions of the Domestic Act where the provisions of the DTAA are more beneficial to the assessee. The Tribunal therefore, has rightly affirmed the conclusion arrived at by CIT(Appeals) in deleting the tax demand relatable to difference between 20% and the actual tax rate on which tax was deducted by the respondent in assessee relevant DTAAS."
4. In view of the above, this Appeal also fails and is accordingly dismissed. The questions of law are answered in favour of the Assessee and against the revenue. No order as to costs.
(BHARGAV D. KARIA, J) (PRANAV TRIVEDI,J) SAJ GEORGE Page 4 of 4 Uploaded by SAJ GEORGE(HC01069) on Fri Sep 12 2025 Downloaded on : Sat Sep 13 04:31:13 IST 2025