Supreme Court Refuses To Entertain NewsClick's Writ Petition Against Tax Demands, Gives One Week Interim Protection To Approach HC

The Supreme Court today (February 21) granted a week's interim protection to PPK Newsclick Studio Pvt Ltd, the company running the news portal NewsClick, in relation to tax recovery demands. The Court while dismissing the Article 32 petition file by the company, granted it liberty to approach the High Court.The bench of CJI Sanjiv Khanna and Justices Sanjay Kumar and KV Viswanathan was hearing a writ petition filed under Article 32 by news portal NewsClick against the tax recovery demands over 'unexplained cash credits'. Senior Advocate Kapil Sibal appearing for the news portal stressed that the petitioners only had 28 Lakhs in the bank account and the demand notice is of Rs. 3.6 Crores. The CJI asked that the petitioners should move the Delhi High Court, he added, "Why don't you take recourse to the procedure which says that if a similar issue is already pending before the ITAT, the assessee can move an application asking the assessing officer to stay and wait the order of the ITAT.Why don't you take recourse to that procedure?" Sibal emphasised, "Who will protect me? 2nd March is my deadline, my business employees won't be paid." CJI then verbally said " We will protect you for a week only." The bench while dismissing the petition, passed the following direction of granting interim protection to the agency for a week : " We are not inclined to entertain the present petition under Article 32 of the Constitution and we leave to the petitioner to approach the Jurisdiction of the High Court under Article 226 of the Constitution of India. However, we make no comments on merits on the assertions made by the Petitioner....let there be no coercive action against the Petitioners for one week" However, before parting, Sibal argued that S.68 of the Income Tax Act 1961 would not be applicable in the present case as it deals with cash credits and not banking transactions. He stated that the petitioner company only dealt in cheque transactions and not cash exchanges per se. He explained : "We will move the High Court, S.68 on the face of it doesn't apply- it's a banking transaction, nothing to do with cash and the assessment is more than what I have received! it's more than the gross amount received. Everything is by cheque- there is not a single cash transaction, but anyway, we will go to the High Court, if they don't give us, we will come back."Notably S.68 deals with procedure to be followed when there is unexplained cash credit in the accounts of the Assessee. Previously, on August 9, 2024, the Court disposed of a plea filed by NewsClick for a stay on the income tax demand and directed that pending the disposal of the appeal filed before the Income Tax Appellate Tribunal (ITAT), there shall be a stay of further recovery of an outstanding amount. This order was passed considering that approximately 30 percent of the demand has been recovered.The said order was passed by the bench of Justices BV Nagarathna and Nongmeikapam Kotiswar Singh in a plea filed by the Newsclick against the Delhi High Court's order rejecting a stay on the income tax demand. On July 8, the Court issued a notice in the SLP.Following the 9 August order, the Top Court on November 18 directed the ICICI Bank to de-freeze of the Agency's bank accountsCase Details : PPK NEWSCLICK STUDIO PVT. LTD. AND ANR. Versus DEPUTY COMMISSIONER OF INCOME TAX (CENTRAL CIRCLE-1) | W.P.(C) No. 158/2025Click Here To Read/Download Order

Supreme Court Refuses To Entertain NewsClick's Writ Petition Against Tax Demands, Gives One Week Interim Protection To Approach HC

Anmol Kaur Bawa

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