SC instructs I-T dept for not passing order in Maruti case till Oct 1

The Supreme Court has recently instructed the Income Tax department for not passing any order in the case of Maruti Suzuki India. The case is linked to the payment of fee of brand licensing and also the royalty by Maruti Suzuki India to its parent company Suzuki Motor Corporation. Chief Justice S H Kapadia was heading a 3- judge bench and it ordered the I-T department for maintaining the same state and not to pass any order in this case till 1st of October.

The bench said that the status quo would be maintained till October 1. The bench which had Justice K S Radhakrishnan and Swatanter Kumar gave this order. A petition by Maruti Suzuki India also follows this order. This petition will be against an order of the Delhi High Court. This order was related to the transfer pricing officer of I-T Department for deciding the tax liability of the company again. However, the apex court gave directions to the TPO for moving ahead with its proceedings for ascertaining tax liability unaffected by the order of Delhi High Court.

The High Court had directed TPO for fixing the tax liability against Maruti Suzuki India Limited. The court had given this direction after noticing that IT department’s approach was irregular and not sustainable. The issue is linked to benefit which Suzuki Motor Corporation gained from using marketing intangibles.

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