GENINS INDIA INSURANCE TPA LIMITED vs. DEPUTY COMMISSIONER OF INCOME TAX & ANR.

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W.P.(C)/3030/2024HC DelhiDLHC01009752202409 May 2024Bench: HON'BLE MR. JUSTICE YASHWANT VARMA,HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV6 pages
AI SummaryAllowed

What did the High Court hold?

The Delhi High Court allowed the writ petitions. The Court held that the Assessment Years (AYs) for which the notices under Section 153C were issued (2012-13, 2010-11, 2013-14, and 2011-12) clearly fell beyond the maximum ten-year window prescribed by Section 153C, given the dates of the notices (December 16, 2022, November 25, 2022, November 18, 2022, and September 5, 2022). The Court relied on its previous decision in Principal Commissioner of Income Tax-1 vs. Ojjus Medicare Pvt. Ltd. The reasoning in Ojjus Medicare established that for non-searched persons under Section 153C, the computation of the six or ten-year block is reckoned from the date of receipt of books of accounts, documents, or assets by the jurisdictional AO, not the date of search. The Court explicitly stated that the issue of reckoning the block periods with reference to the date of search was not tenable. Consequently, the impugned notices and all consequential proceedings were quashed.

What were the facts?

The petitioners, including Genins India Insurance TPA Limited, Deepak Mithal, Rishi Kesh Chopra, and Anjali Mithal, filed writ petitions challenging notices issued under Section 153C of the Income Tax Act, 1961. The notices were dated December 16, 2022, November 25, 2022, November 18, 2022, and September 5, 2022. The assessment years (AYs) involved were 2012-13, 2010-11, 2013-14, and 2011-12. The core of the challenge was that the AYs for which the notices were issued fell outside the permissible time window stipulated by Section 153C, considering the dates of the notices.

What were the issues?

1. Whether the Assessment Years (AYs) for which notices under Section 153C were issued, specifically AYs 2012-13, 2010-11, 2013-14, and 2011-12, fall outside the ten-year window prescribed by Section 153C, considering the dates of the notices (December 16, 2022, November 25, 2022, November 18, 2022, and September 5, 2022)? Assessee's contention: The AYs in question are beyond the ten-year period permissible under Section 153C, making the notices invalid. Revenue's contention: Not recorded in the judgment. 2. How should the ten-year period under Section 153C be reckoned, particularly in relation to the date of receipt of books of accounts, documents, or assets by the jurisdictional Assessing Officer (AO) for a non-searched person, as opposed to the date of search?

Which sections of the Income-tax Act were involved?

Section 153C,Section 153A

AI-generated summary — verify with the full judgment below

Heard together (3 matters)

W.P.(C) 3030/2024
W.P.(C) 3083/2024
W.P.(C) 3016/2024

Read from the judgment's own cause title. This page is filed under one of them.

$~32 to 39 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 3030/2024 & CM APPL 12507/2024

GENINS INDIA INSURANCE TPA LIMITED ..... Petitioner

Through: Mr. Sumit Lalchandani, Adv.

Versus

DEPUTY COMMISSIONER OF INCOME TAX & ANR. ..... Respondents

Through: Mr. Gaurav Gupta, Sr. SC

alongwith Mr. Shivendra Singh

and Mr. Yojit Pareek, Jr. SCs.

33 + W.P.(C) 3083/2024 & CM APPL 12706/2024

GENINS INDIA INSURANCE TPA LIMITED ..... Petitioner

Through: Mr. Sumit Lalchandani, Adv.

Versus

DEPUTY COMMISSIONER OF INCOME TAX & ANR. ..... Respondents

Through: Mr. Gaurav Gupta, Sr. SC

alongwith Mr. Shivendra Singh

and Mr. Yojit Pareek, Jr. SCs. 34 + W.P.(C) 3016/2024 & CM APPL 12448/2024

DEEPAK MITHAL

..... Petitioner

Through: Mr. Sumit Lalchandani, Adv.

Versus

INCOME TAX OFFICER WARD 50 1 DELHI AND ANR 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 14/05/2024 at 20:03:25

..... Respondents

Through: Mr. Shlok Chandra, Sr. SC

alongwith Ms. Priya Sarkar,

Ms. Madhavi Shukla, Jr. SCs

with Mr.Sudarshan Roy,

Advocate

35 + W.P.(C) 3081/2024 & CM APPL 12701/2024

DEEPAK MITHAL

..... Petitioner

Through: Mr. Sumit Lalchandani, Adv.

Versus

INCOME TAX OFFICER WARD 50 1 DELHI AND ANR ..... Respondents

Through: Mr. Shlok Chandra, Sr. SC

alongwith Ms. Priya Sarkar,

Ms. Madhavi Shukla, Jr. SCs

with Mr.Sudarshan Roy,

Advocate

36 + W.P.(C) 3025/2024 & CM APPL 12492/2024

GENINS INDIA INSURANCE TPA LIMITED..... Petitioner

Through: Mr. Sumit Lalchandani, Adv.

Versus

DEPUTY COMMISSIONER OF INCOME TAX CENTRAL

CIRCLE 28 NEW DELHI & ANR.

..... Respondents

Through: Mr. Gaurav Gupta, Sr. SC

alongwith Mr. Shivendra Singh

and Mr. Yojit Pareek, Jr. SCs.

37 + W.P.(C) 3027/2024 & CM APPL 12499/2024 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 14/05/2024 at 20:03:25

GENINS INDIA INSURANCE TPA LIMITED..... Petitioner

Through: Mr. Sumit Lalchandani, Adv.

Versus

DY. COMMISSIONER OF INCOME TAX CENTRAL

CIRCLE-28 NEW DELHI & ANR.

..... Respondents

Through: Mr. Gaurav Gupta, Sr. SC

alongwith Mr. Shivendra Singh

and Mr. Yojit Pareek, Jr. SCs.

38 + W.P.(C) 3044/2024 & CM APPL 12543/2024

RISHI KESH CHOPRA

..... Petitioner

Through: Mr. Sumit Lalchandani, Adv.

Versus

INCOME TAX OFFICER WARD 70(1), DELHI & ANR. ..... Respondents

Through: Mr. Puneet Rai, Sr. SC

alongwith Mr. Ashvini Kumar

and Mr. Rishabh Nangia,

Advocates 39 + W.P.(C) 3052/2024 & CM APPL 12564/2024

ANJALI MITHAL

..... Petitioner

Through: Mr. Sumit Lalchandani, Adv.

Versus

INCOME TAX OFFICER WARD 50 1 DELHI AND ANR ..... Respondents

Through: Mr. Shlok Chandra, Sr. SC

alongwith Ms. Priya Sarkar, 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 14/05/2024 at 20:03:25

Ms. Madhavi Shukla, Jr. SCs

with Mr.Sudarshan Roy,

Advocate

CORAM:

HON'BLE MR. JUSTICE YASHWANT VARMA

HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV

O R D E R %

09.05.2024

1.

These writ petitions have been preferred against the impugned notices dated 16 December 2022, 25 November 2022, 18 November 2022 and 5 September 2022 issued under Section 153C of the Income Tax Act, 1961 [“Act”] for Assessment Years’ [“AYs”] 2012-13 [W.P.(C) 3030/2024], 2010-11 [W.P.(C) 3083/2024], 2013-14 [W.P.(C) 3016/2024], 2010-11 [W.P.(C) 3081/2024], 2011-12 [W.P.(C) 3025/2024], 2013-14 [W.P.(C) 3027/2024], 2013-14 [W.P.(C) 3044/2024], and 2010-11 [W.P.(C) 3052/2024] and all consequential proceedings. 2. Bearing in mind the undisputed fact that notices under Section 153C were dated 16 December 2022, 25 November 2022, 18 November 2022 and 5 September 2022, it is ex facie evident that the aforenoted AYs would fall beyond the maximum window of ten years as prescribed. 3. The issue in any case stands answered and covered in favour of the writ petitioner in light of the judgment rendered in Principal Commissioner of Income Tax-1 vs. Ojjus Medicare Pvt. Ltd [2024 SCC OnLine Del 2439]. The relevant paragraphs of the aforesaid decision read as under:- 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 14/05/2024 at 20:03:25

“D. The First Proviso to Section 153C introduces a legal fiction on the basis of which the commencement date for computation of the six year or the ten year block is deemed to be the date of receipt of books of accounts by the jurisdictional AO. The identification of the starting block for the purposes of computation of the six and the ten year period is governed by the First Proviso to Section 153C, which significantly shifts the reference point spoken of in Section 153A(1), while defining the point from which the period of the “relevant assessment year” is to be calculated, to the date of receipt of the books of accounts, documents or assets seized by the jurisdictional AO of the non-searched person. The shift of the relevant date in the case of a non-searched person being regulated by the First Proviso of Section 153C(1) is an issue which is no longer res integra and stands authoritatively settled by virtue of the decisions of this Court in SSP Aviation and RRJ Securities as well as the decision of the Supreme Court in Jasjit Singh. The aforesaid legal position also stood reiterated by the Supreme Court in Vikram Sujitkumar Bhatia. The submission of the respondents, therefore, that the block periods would have to be reckoned with reference to the date of search can neither be countenanced nor accepted. E. The reckoning of the six AYs’ would require one to firstly identify the FY in which the search was undertaken and which would lead to the ascertainment of the AY relevant to the previous year of search. The block of six AYs’ would consequently be those which immediately precede the AY relevant to the year of search. In the case of a search assessment undertaken in terms of Section 153C, the solitary distinction would be that the previous year of search would stand substituted by the date or the year in which the books of accounts or documents and assets seized are handed over to the jurisdictional AO as opposed to the year of search which constitutes the basis for an assessment under Section 153A. F. While the identification and computation of the six AYs’ hinges upon the phrase “immediately preceding the assessment year relevant to the previous year” of search, the ten year period would have to be reckoned from the 31st day of March of the AY relevant to the year of search. This, since undisputedly, Explanation 1 of Section 153A requires us to reckon it “from the end of the assessment year”. This distinction would have to necessarily be acknowledged in light of the statute having consciously adopted the phraseology “immediately preceding” when it be in relation to the six year period and employing the expression “from the end of the assessment year” while speaking of the ten year block.” 4. Accordingly, and for reasons assigned in our decision in Ojjus Medicare, we allow the instant writ petitions and quash the impugned 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 14/05/2024 at 20:03:25

notices dated 16 December 2022, 25 November 2022, 18 November 2022 and 5 September 2022 issued under Section 153C of the Act and all consequential proceedings arising therefrom.

YASHWANT VARMA, J.

PURUSHAINDRA KUMAR KAURAV, J. MAY 09, 2024 p’ma 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 14/05/2024 at 20:03:25

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