GAIL (INDIA) LIMITED vs. ASSISTANT COMMISSIONER OF INCOME TAX & ANR.

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W.P.(C)/1903/2026HC DelhiDLHC01004831202604 May 2026Author: HON'BLE MR. JUSTICE VINOD KUMAR,HON'BLE MR. JUSTICE DINESH MEHTA3 pages
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What did the High Court hold?

The Delhi High Court held that the Assistant Commissioner of Income Tax lacked the jurisdiction to rectify an order passed by the Principal Commissioner of Income Tax under Section 154 of the Income Tax Act, 1961. The Court observed that the impugned order dated 05.01.2026 sought to rectify an order passed by the Principal Commissioner of Income Tax. Furthermore, the scheme of the Vivad se Vishwas Act, 2020, does not grant any power of rectification, even to the Principal Commissioner. Section 5(3) of the Vivad se Vishwas Act, 2020, clearly states that the amount determined and order passed under the scheme shall be final and conclusive. The provisions of the Income Tax Act, 1961, have not been made applicable by the Vivad se Vishwas Act, 2020. Consequently, the order dated 05.01.2026 was found to be contrary to the provisions of the Vivad se Vishwas Act, 2020, and liable to be quashed and set aside. The Court followed its view in Satish Kumar Dhingra (supra). The writ petition was allowed, and the impugned order was quashed and set aside.

What were the facts?

The petitioner, GAIL (India) Limited, filed a writ petition challenging an order dated 05.01.2026 passed by the Assistant Commissioner of Income Tax (respondent no.1) under Section 154 of the Income Tax Act, 1961. The petitioner argued that the order was passed without jurisdiction and illegally. Specifically, the petitioner contended that the order sought to rectify an order dated 01.11.2021 issued by the Principal Commissioner of Income Tax under Section 5(2) of the Direct Tax Vivad se Vishwas Act, 2020. The petitioner asserted that only the Principal Commissioner could rectify their own order, and that Section 154 of the Income Tax Act, 1961, was not applicable to an order passed under the Vivad se Vishwas Act, 2020. The revenue contended that the rectification was necessitated by an audit objection regarding the incorrect calculation of the amount payable under the scheme, and that the cited precedent was distinguishable.

What were the issues?

1. Whether the Assistant Commissioner of Income Tax has the jurisdiction to rectify an order passed by the Principal Commissioner of Income Tax under Section 154 of the Income Tax Act, 1961, when the original order was passed under the Direct Tax Vivad se Vishwas Act, 2020? (Question of law) 2. Whether Section 154 of the Income Tax Act, 1961, is applicable to an order passed under the Direct Tax Vivad se Vishwas Act, 2020? (Question of law) Assessee's Contention: The impugned order passed under Section 154 is without jurisdiction and illegal. Rectification of the Principal Commissioner's order could only be done by the Principal Commissioner. Section 154 of the Income Tax Act, 1961, is not applicable to an order passed under the Vivad se Vishwas Act, 2020. Relied on: Satish Kumar Dhingra v. Commissioner of Income Tax [2024] 467 ITR 574 (Del). Revenue's Contention: The rectification order was necessitated by an audit objection concerning the wrong calculation of the amount payable under the Vivad se Vishwas scheme. The judgment in Satish Kumar Dhingra (supra) is distinguishable on facts.

Which sections of the Income-tax Act were involved?

Section 154,Section 5(2),Section 5(3)

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
$~12 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 1903/2026, CM APPL. 9234/2026 & CM APPL. 9235/2026 GAIL (INDIA) LIMITED .....Petitioner Through: Mr. Rohit Jain and Mr. Samarth Choudhary, Advocates versus ASSISTANT COMMISSIONER OF INCOME TAX & ANR. .....Respondents Through: Mr. Gaurav Gupta, SSC with Mr.Shivendra Singh & Mr. Yojit Pareek, JSCs CORAM: HON'BLE MR. JUSTICE DINESH MEHTA HON'BLE MR. JUSTICE VINOD KUMAR

O R D E R %

04.05.

2026

1.

By way of present writ petition, the petitioner has challenged the order dated 05.01.2026 passed by respondent no.1 under Section 154 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act of 1961’).

2.

Mr. Rohit Jain, learned counsel for the petitioner at the outset submitted that the impugned order passed in exercise of the purported powers of rectification given under Section 154 of the Act of 1961 is wholly without jurisdiction and illegal on various counts.

3.

He submitted that what has been rectified by the Assessing Officer vide impugned order dated 05.01.2026 is, the order dated 01.11.2021 issued by the Principal Commissioner of Income Tax as per Section 5(2) of the Direct Tax Vivad se Vishwas Act of 2020 (hereinafter referred to as ‘the 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 06/05/2026 at 13:00:18

Act of 2020’).

4.

He submitted that the order which has been passed by the Principal Commissioner of Income Tax, if at all could be rectified, could be rectified by the Principal Commissioner of Income Tax himself and not by the respondent no.1. 5. He further submitted that the invocation of provision under Section 154 of the Act of 1961 is per se misconceived inasmuch as the order passed by the Principal Commissioner of Income Tax on 01.11.2021 was passed under the Act of 2020, which does not make Section 154 of the Act of 1961 applicable.

6.

In support of the aforesaid, he relied upon a judgment of this Court rendered in the case of Satish Kumar Dhingra v. Commissioner of Income Tax reported in [2024] 467 ITR 574 (Del).

7.

Mr. Gaurav Gupta, learned Senior Standing Counsel, on the other hand submitted that the impugned rectification order was necessitated, as the Assessing Officer came to receive an audit objection indicating therein that the amount to be paid under the scheme was wrongly calculated by the respondent at the time of issuance of certificate under the Act of 2020. 8. He further submitted that the judgment of this Court in the case of Satish Kumar Dhingra (supra) is distinguishable from the present case on facts.

9.

Heard learned counsel for the parties and perused the record.

10.

A simple look at the order dated 05.01.2026 shows that the respondent no.1 has sought to rectify an order which was passed by Principal Commissioner of Income Tax.

11.

We further observe that the scheme of the Act of 2020 does not give 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 06/05/2026 at 13:00:18

any power of rectification even to the Principal Commissioner of Income Tax. The provision contained under Section 5(3) of the Act of 2020 clearly provides that the amount determined and order passed under the Scheme shall be final and conclusive. Provisions of the Act of 1961 have not been made applicable by the Act of 2020. 12. The order impugned dated 05.01.2026 is clearly contrary to the provisions of the Act of 2020 and is, therefore, liable to be quashed and set aside. Similar is the view taken by this Court rendered in the case of Satish Kumar Dhingra (supra).

13.

The writ petition is, therefore, allowed. The order dated 05.01.2026 passed by respondent no.1 is quashed and set aside.

14.

The writ petition is disposed of alongwith pending applications. DINESH MEHTA, J. VINOD KUMAR, J. MAY 4, 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 06/05/2026 at 13:00:18

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