ITAT Delhi on Reopening of Assessment Beyond Four Years: Reassessment Quashed as Without Jurisdiction.

The ITAT Delhi held that reassessment proceedings initiated against Make My Trip (India) Pvt. Ltd. beyond four years from the end of the relevant assessment year were invalid and without jurisdiction, as the Assessing Officer (AO) failed to demonstrate any failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment. The Tribunal quashed the reassessment for AYs 2007–08 and 2008–09 and dismissed the Revenue’s appeal.

1. The assessee originally filed returns declaring losses for AYs 2007–08 and 2008–09, which were assessed under Section 144C read with Section 143(3) of the Income Tax Act, 1961.
2. Subsequently, the AO reopened the assessments under Section 147 and issued notices under Section 148 after more than four years, alleging non-deduction of tax at source (TDS) on payments of ₹3.6 crore made to Make My Trip Inc. towards ticket cost reimbursements.
3. The CIT(A) upheld the reopening but deleted the addition under Section 40(a) of the Act.
4. The Revenue appealed on merits, while the assessee filed Cross Objections challenging the reopening as being without jurisdiction.

1. The Tribunal noted that the reasons recorded for reopening did not allege any failure on the part of the assessee to disclose fully and truly all material facts — a mandatory condition when reopening beyond four years.
2. The AO’s reasons relied solely on documents already available in the assessment records and not on any new tangible material, indicating a “change of opinion.”
3. The assessee had disclosed the transaction of reimbursement of ₹3.6 crore in Form 3CEB, and it was duly examined by the Transfer Pricing Officer (TPO) and accepted during the original assessment.
4. Relying on CIT v. Kelvinator of India Ltd. (320 ITR 561, SC), Haryana Acrylic Manufacturing Co. v. CIT (308 ITR 38, Del), and Wel Intertrade (P) Ltd. v. ITO (308 ITR 22, Del), the Tribunal held that reassessment beyond four years without failure to disclose material facts was impermissible.
5. The Tribunal found that the Revenue’s reliance on certain precedents was misplaced, as none dealt with reopening beyond four years where the first proviso to Section 147 applied.

1. Cross Objections (Assessee): Allowed — reassessment quashed as invalid.
2. Revenue’s Appeals: Dismissed as infructuous following quashing of reassessment.
3. Outcome: Reassessment proceedings for AYs 2007–08 and 2008–09 quashed; assessee succeeds.

1. Section 147, Income Tax Act, 1961 – Income escaping assessment and conditions for reopening.
2. Section 148, Income Tax Act, 1961 – Issue of notice for reassessment.
3. Section 40(a), Income Tax Act, 1961 – Disallowance for failure to deduct TDS.
4. Section 195, Income Tax Act, 1961 – Deduction of tax on payments to non-residents.
5. First Proviso to Section 147 – Requirement of failure to disclose material facts for reopening beyond four years.

Citation: ITA Nos. 5384 & 5385/DEL/2017 | CO Nos. 48 & 47/DEL/2017 | AYs 2007–08 & 2008–09

Case: Make My Trip (India) Pvt. Ltd. v. Additional Commissioner of Income Tax, Special Range-6, New Delhi

Court: Income Tax Appellate Tribunal, Delhi Bench “D”

Coram: Shri Vikas Awasthy (Judicial Member) & Shri Brajesh Kumar Singh (Accountant Member)

Date of Hearing: 11 August 2025

Date of Decision: 10 November 2025