Amid Samsung India’s ongoing market challenges and tax disputes, much to its relief, the Delhi High Court overturned the ITAT’s decision, granting it a stay on a ₹12.13 billion tax demand.
On Monday, answering Samsung India’s appeal, the Delhi High Court overturned a decision by the Income Tax Appellate Tribunal (ITAT), which had dismissed the company’s request to stay a ₹12.13 billion tax demand for the 2021-22 assessment year.
A division bench of Justices Vibhu Bakhru and Swarna Kanta Sharma restored Samsung’s stay application and directed the ITAT to expedite the matter’s decision based on its merits.
On November 22, the ITAT had rejected Samsung’s plea, deeming it ‘premature,’ and argued that the company had not shown any immediate action by tax authorities that could justify a stay. Without the threat of imminent action, the tribunal dismissed the request.
This led Samsung to escalate the case to the Delhi High Court, which ruled in the company’s favour and annulled the ITAT’s decision.
Samsung India has faced ongoing tax issues with Indian authorities. In 2023, the Directorate of Revenue Intelligence (DRI) issued a show-cause notice alleging customs duty evasion of ₹17.28 billion ($212 million) for misclassifying remote radio heads to gain improper duty exemptions.
In addition to its tax disputes, Samsung is grappling with operational disruptions at its Chennai factory, where workers have been on strike for three days, impacting the production of televisions, refrigerators, and washing machines.
Samsung’s challenges are further compounded by its diminishing position in India’s smartphone market. Once leading, Samsung has now slipped to third place in volume, behind Chinese brands Vivo and Xiaomi, with an 18% to 17% market share compared to their 19% each, according to research firms Counterpoint and Canalys.