Vikram Kapahi Vs ACIT (Delhi High Court)
The Delhi High Court allowed the writ petition after finding that the issues and challenge raised in the petition stood concluded in light of its judgment in Twylight Infrastructure (P) Ltd. v. CIT [2024 SCC OnLine Del 330]. Following the reasons assigned in that judgment, the Court quashed the impugned notice and orders dated 29 June 2021, 21 May 2022 and 26 July 2022.
The relief was made subject to the liberty reserved in paragraphs 28 to 30 of Twylight Infrastructure. Those paragraphs recorded that the Revenue sought liberty to commence reassessment proceedings afresh if the impugned orders and notices were set aside. The Court in Twylight Infrastructure had accordingly quashed the impugned notices and orders on the ground that there was no approval of the specified authority as indicated in Section 151(ii) of the Income Tax Act, while reserving liberty to the Revenue to take steps, if deemed necessary, albeit as per law. The rights and contentions of both sides were also kept open if the Revenue initiated reassessment proceedings.
The writ petition was consequently disposed of.
Issues and Judicial Outcome
The challenge raised in the writ petition was held to be covered by the Delhi High Court’s judgment in Twylight Infrastructure (P) Ltd. v. CIT [2024 SCC OnLine Del 330]. The Court therefore followed the reasons assigned in that judgment and allowed the writ petition.
The principal consequence was the quashing of the notice and orders dated 29 June 2021, 21 May 2022 and 26 July 2022. The order expressly preserved the liberty contemplated in paragraphs 28 to 30 of Twylight Infrastructure.
Reliance on Twylight Infrastructure
The Court recorded that the issues and challenge raised in the present matter stood concluded in light of Twylight Infrastructure (P) Ltd. v. CIT. The Court did not separately set out a new analysis of the underlying issue but allowed the writ petition for the reasons assigned in the aforenoted judgment.
The relevant judgment had dealt with the absence of approval of the specified authority contemplated under Section 151(ii). The Delhi High Court had stated that the impugned notices and orders were quashed on that ground, while preserving liberty for the Revenue to take further steps, if deemed necessary, in accordance with law.
Liberty Reserved to the Revenue
Paragraph 28 of Twylight Infrastructure, as reproduced in the present order, records that counsel for the Revenue sought liberty to commence reassessment proceedings afresh if the impugned orders and notices were set aside based on the judgment in Ganesh Dass Khanna.
Paragraph 29 records that the impugned notices and orders were quashed on the ground that there was no approval of the specified authority indicated in Section 151(ii) of the Act. At the same time, the Revenue was given liberty to take steps, if deemed necessary, in accordance with law.
Paragraph 30 further records that the rights and contentions of both sides would remain open in the event the Revenue triggered reassessment proceedings.
Final Decision
Following Twylight Infrastructure, the Delhi High Court allowed the instant writ petition and quashed the impugned notice and orders dated 29 June 2021, 21 May 2022 and 26 July 2022, subject to the liberty reserved under paragraphs 28 to 30 of that judgment.
The writ petition was disposed of accordingly.
Cases Discussed
- Twylight Infrastructure (P) Ltd. v. CIT [2024 SCC OnLine Del 330] — Delhi High Court
- Ganesh Dass Khanna v. Income Tax Officer — Delhi High Court
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. On hearing learned counsels for parties, we find that the issues and the challenge raised, stands concluded in light of the judgment rendered by the Court in Twylight Infrastructure (P) Ltd. v. CIT [2024 SCC OnLine Del 330].
2. Accordingly, for the reasons assigned in the aforenoted judgment, we allow the instant writ petition and quash the impugned notice and orders dated 29 June 2021, 21 May 2022 and 26 July 2022, subject to liberty reserved as per paragraph Nos. 28 to 30 of Twylight Infrastructure, and which read as under:
“28. Before us, the counsel for the revenue continue to hold this position. The only liberty that they seek is that if, based on the judgment in Ganesh Dass Khanna, the impugned orders and notices are set aside, liberty be given to the revenue to commence reassessment proceedings afresh.
29. Therefore, having regard to the aforesaid, the impugned notices and orders in each of the above-captioned writ petitions are quashed on the ground that there is no approval of the specified authority, as indicated in Section 151(ii) of the Act. The direction is issued with the caveat that the revenue will have liberty to take steps, if deemed necessary, albeit as per law.
30. Needless to add, the rights and contentions of both the sides will remain open, in the event the revenue triggers reassessment proceedings.”
3. The writ petition is disposed of accordingly.
