W.P.(C) No.285/2020

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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Date of decision: 19^th January, 2021

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W.P.(C) 285/2020, CM Nos. 857/2020 (of petitioner for stay of

operation of the impugned order dated 4^th November, 2019) &

34968/2020 (for vacation of stay granted by this Hon'ble Court

vide its order dated 10^th January, 2020).

TAHILIANI DESIGN PRIVATE LIMITED ..... Petitioner

Through:

Mr. P. Roychoudhri, Advocate.

Versus

JOINT CIT, CENTRAL WING,

CENTRAL RANGE-8, DELHI

..... Respondent

Through:

Ms.

Vibhooti

Malhotra,

Senior

Standing Counsel.

CORAM:

HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

HON'BLE MR. JUSTICE SANJEEV NARULA

[VIA VIDEO CONFERENCING]

RAJIV SAHAI ENDLAW, J.

1. The petition impugns the order dated 4^th November, 2019 for the

assessment year 2018-19, under Section 271DA of the Income Tax Act,

1961 ("Act"), imposing penalty on the petitioner in the sum of

Rs.14,27,96,270/-.

2. The petition came up first before this Court on 10^th January, 2020,

when on the contention of the counsel for the petitioner that the order dated

4^th November, 2019 imposing penalty was passed after the petitioner had

made an application before the Settlement Commission under Section 245C

of the Act on 1^st November, 2019, under intimation to the Assessing

Officer, the petition was entertained, counter affidavit directed to be filed

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and the order imposing penalty was stayed; it was however clarified that the

proceedings before the Settlement Commission shall go on, uninfluenced

by the pendency of this petition.

3. No counter affidavit has been filed inspite of two opportunities. The

counsel for the respondent states that a counter affidavit has been filed but

has not come on record. The counsel for the petitioner states that he has

received advance copy of the same. The counsel for the respondent draws

attention to CM No.34968/2020 filed by the respondent, for vacation of the

stay granted on 10^th January, 2020 and expresses urgency, contending that

the petitioner has obtained stay of the order imposing penalty, by

misrepresenting / suppressing facts. We have however enquired from the

counsel for the petitioner, whether not the hearing on the application for

vacation of stay as well as on the main petition itself, would be substantially

similar. The counsel for the petitioner then states that the writ petition itself

can be heard today, without the counter affidavit coming on record in as

much as the outcome of the writ petition depends upon the interpretation of

the statutory provisions and the respondent does not need to refer to any

documents other than those annexed to the petition and in fact the

respondent, along with its counter affidavit has not annexed any documents

and the pleadings in the counter affidavit are also confined to law, which

can be argued. We have thus proceeded to hear the counsels on the writ

petition.

4. It is the case of the petitioner, (a) that a search and seizure operation

under Section 132 of the Act as well as survey under Section 133A of the

Act was carried out on 29^th May, 2018 in the case of the petitioner and

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thereafter the investigation wing referred the case of the petitioner to the

concerned Assessing Officer; (b) the respondent, being the Range Head of

the Assessing Officer of the petitioner, after going through the seized

material, presumed that the petitioner had violated the provisions of Section

269ST of the Act and issued a notice dated 30^th September, 2019 to the

petitioner, for assessment years 2018-19 and 2019-20, calling upon the

petitioner to show cause why penalty under Section 271DA of the Act, for

violating the provisions of Section 269ST of the Act, be not imposed on the

petitioner and fixed the case