AECOM TECHNICAL SERVICES INC vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE INTERNATIONAL TAX- 1(1)(1) DELHI & ANR.

PDF · subscribers
W.P.(C)/3148/2026HC DelhiDLHC01008710202617 March 2026Author: HON'BLE MR. JUSTICE VINOD KUMAR,HON'BLE MR. JUSTICE DINESH MEHTA3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the writ petition, setting aside the impugned order dated 02.03.2026. The Court found that the Competent Authority had defied the binding directions previously issued by the High Court in the petitioner's own case for the same financial year. The reasoning for the rejection, based on the department's contemplation of filing an SLP, was deemed insufficient to justify the defiance of a clear judicial order. The Court directed the Competent Authority to issue a Tax Withholding Certificate at a 'Nil' rate within three days. This short timeframe was granted because delaying the issuance beyond 31.03.2026 would render the certificate ineffective for the financial year 2025-26. The principle established is that departmental contemplation of an appeal does not permit defiance of a High Court's binding order.

What were the facts?

The petitioner, AECOM Technical Services Inc., filed a writ petition challenging an order dated 02.03.2026 passed by the Assistant Commissioner of Income Tax, Circle International Tax-1(1)(1), Delhi. This order rejected the petitioner's application under Section 197 of the Income Tax Act, 1961, for a Tax Withholding Certificate at a 'Nil' rate. The petitioner argued that the impugned order defied a previous order dated 20.05.2025 passed by the same High Court in their case for the same financial year, which had directed the issuance of such a certificate. The petitioner highlighted that despite the High Court's binding directions, the Competent Authority rejected the application, citing the department's contemplation of filing a Special Leave Petition (SLP) and the delay in filing it.

What were the issues?

1. Whether the Competent Authority acted in defiance of the binding directions issued by the High Court in its previous order dated 20.05.2025 by rejecting the petitioner's application for a 'Nil' rate Tax Withholding Certificate under Section 197 of the Income Tax Act, 1961. Assessee's Contentions: - The impugned order dated 02.03.2026 is in direct contravention of the High Court's order dated 20.05.2025 passed in the petitioner's own case for the same financial year. - The Competent Authority disregarded the binding directions of the High Court by merely stating that the Income Tax Department was considering filing an SLP. - More than eight months had passed since the High Court's order, and no SLP had been filed, let alone a stay obtained, meaning the Competent Authority could not refuse to follow the Court's directions. Revenue's Contentions: - The learned Senior Standing Counsel attempted to justify the order dated 02.03.2026 but was unable to provide a satisfactory explanation for the Competent Authority's defiance of the High Court's binding directions, particularly based on the department's intention to file an SLP.

Which sections of the Income-tax Act were involved?

Section 197

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
W.P.(C) 3148/2026 Page 1 of 3 $~4 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 3148/2026, CM APPL. 15120/2026 & CM APPL. 15121/2026 AECOM TECHNICAL SERVICES INC .....Petitioner Through: Ms. Ananya Kapoor, Advocate. versus ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE INTERNATIONAL TAX- 1(1)(1) DELHI & ANR. .....Respondents Through: Mr. Anurag Ojha, SSC with Mr. V.K. Saksena and Ms. Hemlata Rawat, JSCs. CORAM: HON'BLE MR. JUSTICE DINESH MEHTA HON'BLE MR. JUSTICE VINOD KUMAR

O R D E R %

17.03.

2026

1.

By way of present writ petition, petitioner has challenged the order dated 02.03.2026 passed by respondent no.1-Office of the Assistant Commissioner of Income Tax Circle Int Tax 1(1)(1), Delhi (hereinafter referred to as ‘the Competent Authority’), whereby the petitioner’s application under Section 197 of the Income Tax Act, 1961 for issuance of Tax Withholding Certificate at ‘Nil’ rate has been rejected.

2.

Ms. Ananya Kapoor, learned counsel for the petitioner, at the outset, submitted that the order impugned dated 02.03.2026 is clearly in the teeth of the order dated 20.05.2025 passed by this Court in the petitioner’s case for this very financial year.

3.

She further submitted that in spite of the clear adjudication and direction issued by this Court in petitioner’s own case, the Competent This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/03/2026 at 13:49:02

W.P.(C) 3148/2026 Authority has turned down the petitioner’s request to issue Tax Withholding Certificate at ‘Nil’ rate. She took the Court through the relevant part of the impugned order and submitted that a binding order giving directions passed by this Court has been literally thrown to winds by the Competent Authority by simply observing that the Income Tax-Department is thinking of or is in the process of preferring an SLP.

4.

While highlighting that more than eight months have passed since the date when the High Court allowed petitioner’s writ petition and yet no SLP has been filed much less getting a stay, she contended that the Competent Authority could not have refused to follow the directions passed by this Court.

5.

Mr. Anurag Ojha, learned Senior Standing Counsel, on the other hand tried to justify the order dated 02.03.2026 to the best of his ability but was to his wit’s end. He could hardly satisfy us as to how could the Competent Authority dare defying the binding directions issued by this Court simply because the Department was in the process of deciding as to whether it should file an SLP before Hon’ble the Supreme Court or not.

6.

Though there remains much to be added in the present order but we refrain from doing so and give benefit of doubt to the Competent Authority and close the chapter here itself; however, setting aside the impugned order dated 02.03.2026. 7. The Competent Authority is directed to issue a Tax Withholding Certificate at ‘Nil’ rate within a period of three days from today.

8.

Such small window of three days is being given considering that in case the issuance of certificate takes more time, it will practically render the petitioner’s case infructuous as after 31.03.2026, the Tax Withholding This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/03/2026 at 13:49:02

W.P.(C) 3148/2026 Certificate, even if issued, will be of no avail to the petitioner as the financial year 2025-26 will be over.

9.

The writ petition stands allowed, in the aforesaid terms. All pending applications stand disposed of. DINESH MEHTA, J. VINOD KUMAR, J. MARCH 17, 2026/nk This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/03/2026 at 13:49:02

More judgments on Section 197

All 188 judgments and leading authorities on Section 197 →

Recent GST High Court judgments

Search GST case law →