Make Mytrip (India) Private Limited Vs ACIT (Delhi High Court)
Core Issue The principal issue before the Court in Make Mytrip India Pvt Ltd vs ACIT Circle 75(1) Delhi was whether an application under section 197 of the Income-tax Act for grant of a Nil or lower withholding tax certificate can be rejected solely on the basis of outstanding tax demands, without examining the statutory parameters prescribed under Rule 28AA, and without passing a reasoned and speaking order, particularly when (i) the assessee has substantial brought forward losses resulting in nil taxable income, (ii) large refunds are due from the Revenue, and (iii) in earlier years, on identical facts, lower withholding certificates were consistently granted. The Court also examined whether such rejection violates the principles of consistency, non-arbitrariness, and natural justice, and whether the existence of disputed and non-final demands can be treated as a determinative ground for denial of relief under section 197.
Facts The petitioner, Make My Trip (India) Pvt. Ltd., is a well-established company engaged in providing online travel services including booking of air tickets, hotels and holiday packages, and has been regularly assessed to tax in Delhi for more than a decade. Over the years, the petitioner had consistently applied for and was granted certificates under section 197 for lower deduction of tax at source, with rates ranging from 0.10% to 0.30% in the immediately preceding financial years. For the relevant financial year 2025–26 (AY 2026–27), the petitioner filed an application dated 19.05.2025 seeking a Nil withholding certificate, or alternatively a certificate at 0.30%, on the ground that it had substantial brought forward losses and unabsorbed depreciation, resulting in nil taxable income for the year.
