NATIONAL PETROLEUM CONSTRUCTION COMPANY versus DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2(2), INTERNATIONAL TAXATION, NEW DELHI & ANR.

Citation: [2022] 17 S.C.R. 236 · Decided: 29-07-2022 · Supreme Court of India · Bench: INDIRA BANERJEE · Disposal: Matter referred to larger bench
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Judgment (excerpt)

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   [2022] 17 S.C.R. 236
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NATIONAL PETROLEUM CONSTRUCTION COMPANY
v.
DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2(2),
INTERNATIONAL TAXATION, NEW DELHI & ANR.
(Civil Appeal No. 4964 of 2022)
JULY 29, 2022
[INDIRA BANERJEE AND J. K. MAHESHWARI, JJ.]
Income Tax Act, 1961 – ss.197, 195(1) – Income Tax (Second
Amendment) Rules, 2011 – r.28AA – Writ Petition filed by Appellant
against the refusal of the Respondent no.1 to modify the Certificate
issued to it for the financial year 2019-20 (corresponding to the
Assessment Year 2020-21) u/s.197 for Tax Deduction at Source
(TDS) at the rate of 4% in respect of payments received by the
Appellant from ONGC towards work done out of India as well as
within India, dismissed by High Court – Correctness of – Held:Per
Indira Banerjee, J. High Court rightly held that the question of
whether the appellant had Permanent Establishment (PE), could
not possibly be undertaken in an enquiry for issuance of certificate
u/s.197 of the IT Act –Further, the Appellant itself made a request
for Certificate for TDS at the rate of 4% on all receipts – Thus, the
impugned certificate having been issued as per the appellant’s own
request, the appellant is estopped from questioning the certificate
by initiation of proceedings u/Article 226 – No infirmity in the
reasoning of the High Court calling for interference – Per J. K.
Maheshwari, J. Since there was no change in circumstances and the
situation of the appellant in the financial years 2017-18 and 2018-
19 respectively and in the financial year 2019-20 in question
(assessment year 2020-21) are the same, the principle of consistency
ought to be followed while considering the application u/s.197 of
the IT Act – Order passed by High Court is without considering the
perspective and scope of issuance of certificate for deduction of
tax and also without following the prescribed procedure – High
Court committed error in dismissing the writ petition – In view of
difference of opinion, matter to be placed before Hon’ble the Chief
Justice of India to constitute an appropriate bench to hear the matter
– Constitution of India – Article 226.
(In the judgment of Indira Banerjee, J. )
G.E. India Technology Centre Pvt. Ltd. v. Commissioner
of Income Tax and Anr. (2010) 327 ITR 456 (SC);
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Ishikawajima-Harima Heavy Industries v. Director of
Income Tax, Mumbai (2007) 288 ITR 408 (SC);
Commissioner of Income Tax and Anr. v. Hyundai Heavy
Industries Co. Ltd (2007) 291 ITR 482 (SC) – referred
to.
(In the judgement of J.K. Maheshwari, J.)
M/s Radhasoami  Satsang, Saomi Bagh, Agra v.
Commissioner of Income Tax (1992) 1 SCC 659 : [1991]
2 Suppl. SCR 312; Bharat Sanchar Nigam Limited and
Anr. v. Union of India and Ors. (2006) 3 SCC 1 : [2006]
2 SCR 823 – relied on.
Case Law Reference
In the judgment of Indira Banerjee, J.
(2010) 327 ITR 456 (SC)
referred to
Para 36
(2007) 288 ITR 408 (SC)
referred to
Para 40
(2007) 291 ITR 482 (SC)
referred to
Para 40
In the judgment of J. K. Maheshwari, J.
[1991] 2 Suppl. SCR 312
relied on
 Para 16
[2006] 2 SCR 823
relied on
Para 16
CIVIL APPELLATE JURISDICTION : Civil Appeal No.4964
of 2022.
From the Judgment and Order dated 20.12.2019 of the High Court
of Delhi at New Delhi in WP (C) No.8527 of 2019.
S. Ganesh, Sr. Adv., Bhargava V. Desai, Shivam Jasra, Ms. Aditi
Diwan, Advs. for the Appellant.
N. Venkataraman, ASG, Shyam Gopal, Chandra Kant Sharma,
Ms. Rashmi Malhotra, Ms. Preeti Rani, Akshya Amritanshu, Raj Bahadur
Yadav, Advs. for the Respondents.
The Judgments and Order of the Court were delivered by
INDIRA BANERJEE, J.
Leave granted.
2. This appeal is against the judgment and final order dated 20th
December 2019 passed by High Court of Delhi dismissing the Writ Petition
being Writ Petition (C) No.8527 of 2019 filed by the Appellant against
the refusal of the Respondent No.1 to modify the Certificate dated 26th
June 2019 issued to the Appellant for the Financial/Previous Year 2019-
20, corresponding to the Assessment Year 2020-21, under Section 197
NATIONAL PETROLEUM CONST. CO. v. DEPUTY COMM’R OF INCOME
TAX, CIRCLE 2(2), INTERNATIONAL TAXATION
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SUPREME COURT REPORTS
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of the Income Tax Act 1961, hereinafter referred to as the “IT Act”, for
Tax Deduction at Source (TDS) at the rate of 4% in respect of payments
received by the Appellant from Oil and Natural Gas Company Ltd.
hereinafter referred to as the “ONGC” towards work d
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