Delhi High Court Quashes Income Tax Notices Against NDTV Founders Prannoy Roy And Radhika Roy; Imposes ₹2 Lakh Cost On Dept

The Delhi High Court has set aside the income tax reassessment notices issued to New Delhi Television Ltd. (NDTV) founders Prannoy Roy and Radhika Roy (petitioners), relating to a transaction involving RRPR Holding Pvt. Ltd, a promoter group of the news network.

The bench further imposed Rs. 2 Lakh costs on tax authorities, directing that Rs. 1 Lakh be paid to each petitioner.

Senior Advocate Sachit Jolly, for the petitioners, argued that the tax authorities had previously reopened the case in July 2011, leading to a reassessment order issued in March 2013.

A Division Bench consisting of Justices Dinesh Mehta and Vinod Kumar stated that the Department's attempt to revisit interest-free loans advanced to RRPR Holding Pvt. Ltd. was improper because the same transactions had already been examined in an earlier assessment cycle.

The reassessment notices were challenged by the Roys in November 2017 on the ground that reopening assessments on identical issues amounted to an impermissible 'change in opinion' under the Income Tax Act.

The bench agreed with the Roys that the department cannot take a different view after an earlier reassessment has been completed and accordingly allowed the petition.

A detailed judgment is awaited.