M/S. NINEX DEVELOPERS LIMITED vs. INCOME TAX OFFICER ITO WARD-76(1) NEW DELHI

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W.P.(C)/7905/2025HC DelhiDLHC01035569202529 May 2025Bench: HON'BLE MR. JUSTICE VIBHU BAKHRU,HON'BLE MR. JUSTICE TEJAS KARIA2 pages
AI SummaryDismissed

What did the High Court hold?

The Delhi High Court dismissed the writ petition filed by M/s. Ninex Developers Limited. The Court noted that the issue involved in the present case was whether the petitioner was liable to deduct tax at source under Section 194C of the Income Tax Act, 1961, in respect of external development charges paid to Haryana Shahari Vikas Pradhikaran. The learned counsel for the petitioner conceded that this issue was covered against the petitioner by a previous decision of the same Court in Puri Constructions Private Limited v. Additional Commissioner of Income Tax: Neutral Citation: 2024:DHC:1040-DB. Following this precedent, the Court found no reason to deviate from the established position and accordingly dismissed the petition. No specific findings on the merits of the EDC payments being subject to TDS were elaborated upon, as the dismissal was based on the binding precedent.

What were the facts?

The petitioner, M/s. Ninex Developers Limited, filed a writ petition before the Delhi High Court challenging an order dated 21.12.2023 passed by the Income Tax Officer (ITO) under Section 201(1) read with Section 201(1A) of the Income Tax Act, 1961. This order pertained to Assessment Year 2017-18 (Financial Year 2016-17) and concerned the petitioner's liability to deduct Tax Deducted at Source (TDS) on payments made towards External Development Charges (EDC) to the Directorate of Town and Country Planning (DTCP)/Haryana Shahari Vikas Pradhikaran (HSVP). The petitioner sought to quash the order, declare that EDC payments are not subject to TDS under Section 194C or any other provision, and prevent consequential actions including penalty proceedings under Section 271C.

What were the issues?

1. Whether the payments made by the petitioner towards External Development Charges (EDC) to the Directorate of Town and Country Planning (DTCP)/Haryana Shahari Vikas Pradhikaran (HSVP) are statutory in nature and not subject to Tax Deducted at Source (TDS) under Section 194C or any other provision of the Income Tax Act, 1961? Assessee's Contention: The petitioner argued that the impugned order is arbitrary, without jurisdiction, and contrary to law. They contended that EDC payments are statutory and not subject to TDS under Section 194C or any other provision. They also relied on the bona fide conduct of the petitioner and conflicting positions taken by different government arms. Revenue's Contention: The judgment does not record specific arguments from the revenue. However, the existence of the impugned order under Section 201(1) and 201(1A) implies the revenue's position that TDS was deductible.

Which sections of the Income-tax Act were involved?

Section 194C,Section 201(1),Section 201(1A),Section 271C

AI-generated summary — verify with the full judgment below

$~60 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 7905/2025 M/S. NINEX DEVELOPERS LIMITED .....Petitioner Through: Mr Manish Paliwal and Ms Megha Yadav, Advocates. versus INCOME TAX OFFICER ITO WARD-76(1) NEW DELHI .....Respondent Through: Mr Debesh Panda, SSC with Mr Kanishk Aggarwal, Advocate. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRU HON'BLE MR. JUSTICE TEJAS KARIA O R D E R % 29.05.2025 CM APPL. 34860/2025 1. Exemption is allowed, subject to all just exceptions. 2. The application stands disposed of. W.P.(C) 7905/2025 and CM APPL. 34861/2025 3. The petitioner has filed the present petition, inter alia, praying as under: “a) Issue a writ of Certiorari or any other appropriate writ, order or direction to quash and set aside the impugned order dated 21.12.2023 passed by the Respondent under Section 201(1) read with Section 201(1A) of the Income Tax Act, 1961, for the Assessment Year 2017– 18 (Financial Year 2016–17), on the ground that the same is arbitrary, without jurisdiction, and contrary to law; b) Declare that payments made by the Petitioner towards External Development Charges (EDC) to the Directorate of Town and Country Planning (DTCP)/Haryana Shahari Vikas Pradhikaran (HSVP) 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 01/07/2025 at 20:24:54

are statutory in nature and not subject to Tax Deducted at Source (TDS) under Section 194C or any other provision of the Income Tax Act, 1961; c) Quash all consequential actions or proceedings arising out of or pursuant to the impugned order dated 21.12.2023, including any proposed or ongoing proceedings under Section 271C of the Income Tax Act, 1961; d) Declare that no coercive steps shall be taken by the Respondents for recovery of the alleged demand determined under the impugned order, including any action for levy of penalty or prosecution, in light of the bona fide conduct of the Petitioner and conflicting positions taken by different arms of the Government;” 4. The question involved in the present case is whether the petitioner was liable to deduct tax at source under Section 194C of the Act in respect of the external development charges paid to Haryana Shahari Vikas Pradhikaran. The learned counsel for the petitioner states that the said issue is covered against the petitioner by the decision of this Court in Puri Constructions Private Limited v. Additional Commissioner of Income Tax: Neutral Citation: 2024:DHC:1040-DB. She prays that the present petition be also dismissed following the aforesaid decision. 5. The petition is, accordingly, dismissed. The pending application is also disposed of. VIBHU BAKHRU, J TEJAS KARIA, J MAY 29, 2025 RK Click here to check corrigendum, if any 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 01/07/2025 at 20:24:54

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