The Delhi High Court on Monday struck down income tax reassessment notices issued to NDTV founders Prannoy Roy and Radhika Roy, holding that the tax department had wrongly reopened a matter already scrutinised in earlier proceedings.
Background of the Case
The notices, issued in March 2016, related to allegations surrounding interest-free loans extended to RRPR Holding Pvt. Ltd., the promoter company of NDTV. The Roys challenged the action, stating that the same assessment year had been reopened by tax authorities in July 2011 and concluded with a reassessment order passed in March 2013.
Read also:- No Evidence, Yet Organised Crime Tag: MP High Court Calls It Misuse of Power, Grants Bail
They moved the High Court in November 2017, arguing that the fresh notices amounted to reopening the very same issue for a second time, which is barred under income tax law.
Court’s Observations
A Division Bench comprising Justices Dinesh Mehta and Vinod Kumar found merit in the challenge. The bench observed that once reassessment proceedings are initiated, the assessing officer is empowered to examine the entire income for that year. Issuing another notice on the same material later, the court said, reflects a mere “change of opinion”.
Read also:- Victim’s Allegation in Public View Enough to Face Trial Under SC/ST Act: Kerala HC
“The law does not permit repeated reopening of completed assessments on identical grounds,” the bench remarked during the hearing.
The court also took note of the fact that similar proceedings against RRPR Holding Pvt. Ltd. were already under challenge and that a separate bench had quashed the notice issued to the company in September 2024.
Read also:- Bombay High Court Orders Release of Adult Trafficking Victim, Says She Cannot Be Detained Against Her Will
Decision
Allowing both petitions, the High Court quashed the reassessment notices dated March 31, 2016, along with all actions arising from them.
The bench imposed costs of ₹2 lakh on the Income Tax Department, directing payment of ₹1 lakh each to Prannoy Roy and Radhika Roy.
A detailed judgment is awaited.
Senior Advocate Sachit Jolly with advocates Yiyushti Rawat, Devansh Jain, and Sarthak Abrol appeared for Prannoy Roy and Radhika Roy.
Advocates NP Sahni, Indraj Singh Rai, Sanjeev Menon, Rahul Singh and Gourav Kumar represented the Income Tax Department.
