Case Law Details
Oxfam India Vs PCIT (Delhi High Court)
Introduction: The case of Oxfam India vs PCIT has reached a significant juncture in the Delhi High Court. The court, while dealing with a challenge similar to a previous case, has upheld interim measures and extended the stay on the impugned order. Key considerations involve maintaining proper accounts of contributions, providing details of their utilization, and aligning expenditures with the organization’s objectives.
Detailed Analysis: The court, noting a previous challenge (W.P.(C) 11270/2023), framed interim measures on August 25, 2023. These measures included staying the operation of the impugned order, subject to the petitioner maintaining detailed accounts of contributions. The petitioner was also required to furnish details of contribution utilization, accompanied by a statutory auditor’s certificate. The court emphasized adherence to the organization’s objectives in expenditure.
The Special Leave Petition against the aforementioned order was dismissed on January 5, 2024. Mr. Hossain, representing the respondents, objects to the maintainability of the writ petitions, citing appeal provisions under Section 253(c) of the Income Tax Act. He contends that the Income Tax Appellate Tribunal should address all challenges, including jurisdictional grounds.
Concerning the retrospective application of Section 12AB(4) of the Act, Hossain refers to the inserted clause (c) by the Finance Act, 2022. The court acknowledges a substantial jurisdictional question and the need for a uniform approach in interim orders.
The court decides to continue interim reliefs, as provided in the August 25, 2023 order, until the next hearing. The case is scheduled to be heard on February 27, 2024, in the category of “End of Board” matters.
Conclusion: Delhi High Court maintains the stay on the impugned order in Oxfam India vs PCIT, upholding interim measures. The court considers jurisdictional challenges and emphasizes uniformity in interim orders. The petitioner is granted interim reliefs similar to those in a previous case, ensuring ongoing protection until the next hearing on February 27, 2024.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. Since the respondents are duly represented by Mr. Hossain, let a reply be filed within a period of one week from today. The petitioner shall have a week thereafter to file a rejoinder affidavit.
2. Let the matters be called again on 02.2024 in the category of “End of Board” matters.
3. We note that while evaluating an identical challenge which stood raised in W.P.(C) 11270/2023 and after hearing learned counsels for respective sides, the Court vide its order dated 25 August 2023 had framed interim measures in the following terms:-
“17. In the meanwhile, the operation of the impugned order shall remain stayed, subject to the petitioner maintaining a proper account of the contributions received by it, including the details of the contributors.
18. The petitioner will also furnish details of the mode and manner in which the contributions received are These details will be placed before the Court in the form of an affidavit. The affidavit will be accompanied by a certificate of the statutory auditor.
19. Furthermore, the petitioner will ensure that the contributions received are spent in a manner that is aligned with the objects for which it was constituted. In case of any violation, the respondents/revenue will be free to bring the same to the notice of this court, for the purpose of seeking variation of the interim order that we have passed today.”
4. We have also been informed by Datar, learned senior counsel, that a Special Leave Petition which was taken against the aforesaid order has come to be dismissed on 05 January 2024 in terms of the order passed in Special Leave Petition (Civil) Diary No. 44698/2023.
5. Mr. Hossain, learned counsel representing the respondents, has taken a preliminary objection to the maintainability of the writ petitions itself and contends that the impugned order passed by the Principal Commissioner of Income Tax (Central) Delhi-2, is clearly appealable in terms of Section 253(c) of the Income Tax Act, 1961 [“Act“] and that since the appeal is liable to be tried by the Income Tax Appellate Tribunal, it would be entitled to consider all challenges, including those raised on jurisdictional grounds. It was on the aforesaid basis that Mr. Hossain submitted that the instant writ petitions should be dismissed on that score alone.
6. In so far as the aspect of retrospective application of Section 12AB(4) of the Act is concerned, Hossain, seeks to draw sustenance from clause (ii) as placed in Section 12AB(4)(c) of the Act to contend that the said provision on an ex facie examination enables the respondents to pass an order cancelling the registration, which may impact previous years. Insofar as this aspect is concerned, our attention has been drawn to the fact that clause (c) came to be inserted in Section 12AB(4) of the Act by virtue of the Finance Act, 2022.
7. In view of the aforesaid, we find that a substantial jurisdictional question which merits consideration stands raised. We also bear in mind the need to adopt a uniform and consistent approach insofar as interim orders are concerned. This since an identical challenge has been duly entertained by a coordinate Bench of this Court and interim protection accorded. The Court also bears in mind that pleadings in P.(C) 11270/2023 already stand completed and thus the issue can be decided finally on a short date.
8. We consequently hold that the petitioners shall be entitled to interim reliefs in terms identical to those provided in paragraphs 17-19 of the aforenoted order of 25 August 2023 passed in P.(C) 11270/2023, subject to the clarification that the donations that may be accepted by the petitioners pursuant to the aforenoted interim directions shall be confined to domestic contributions only.
W.P.(C) 11270/2023 and CM APPLs. 43874/2023, 61848/2023 & 2659/2024
9. Interim order passed on 25 August 2023 to continue till the next date of hearing.
10. Let this instant writ petition be called again on 27.02.2024 in the category of “End of Board” matters along with WP(C) 15287/2023 and WP(C) 15364/2023.
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