The Supreme Court on Friday quashed the Income Tax (IT) notice against NDTV citing the delay in filing the case and gave liberty to the Tax authorities to initiate a fresh notice on the tax evasion. The 32-page order concentrated on the issuing of notice after four years and rejected the claim of the Income Tax department that they have a right to issue notice within 16 years. The apex court only looked at the matter of delay over four years in issuing a notice on the tax evasions that happened during the period 2007-2009. The IT issued its notice in 2015. It must be remembered that the scam happened during the era of Congress-ruled UPA and Income tax acted only after Narendra Modi-led Bharatiya Janata Party (BJP) Government came back to power. So it is a matter of debate as to whether the Income Tax department would have been allowed to act within four years when the UPA was in power.
The 32-page order says the Court is not looking into other charges of Income Tax on money laundering and tax evasion and looking only based on the fund transfer from NDTV’s England based shell firm and not looking into NDTV’s money laundering through Netherland based shell firm. The Order which came as a relief to the scam-hit TV channel concentrated on the delay in the filing of the notice and gave liberty to the Tax authorities to file a fresh notice on the charges of money laundering and other charges.
“Conclusion – 44. We accordingly allow the appeal by holding that the notice issued to the assessee (NDTV) shows sufficient reasons to believe on the part of the assessing officer to reopen the assessment but since the revenue has failed to show nondisclosure of facts the notice having been issued after a period of 4 years is required to be quashed. Having held so, we make it clear that we have not expressed any opinion on whether on facts of this case the revenue could take benefit of the second proviso or not. Therefore, the revenue may issue fresh notice taking benefit of the second proviso if otherwise permissible under law. We make it clear that both the parties shall be at liberty to raise all contentions with regard to the validity of such notice. All pending application(s) shall stand(s) disposed of,” said the judgment portion of the Supreme Court Bench comprising Justices L. Nageswara Rao and Deepak Gupta.
NDTV approached Supreme Court in October 2017, against the Delhi High Court (HC) Order ratifying the money laundering and tax evasion findings of the Income Tax and Tribunals. The HC bench headed by Justice Ravindra Bhatt rejected the NDTV’s argument of delay in filing notice after four years of the assessment and approved the Income Tax charges on grave violation in tax evasion and money laundering of more than Rs.525 crores. In Supreme Court, for more than a year NDTV’s appeal was heard by a Bench headed by Justice Rohinton Nariman and later it came to the current Bench.
The Supreme Court said that the power of the Income Tax department to re-open cases after 16 years can’t be allowed based on the provisions of the Tax Notice issued to NDTV and it must be limited within four years.
NDTV was represented by Adv Arvind Datar and Income Tax was represented by Solicitor General Tushar Mehta. As per the current Order, within 30 days Income Tax has to decide, whether they are issuing a fresh notice to NDTV for the money routing and round-tripping through England and Netherland shell firms or not. Latest update: Late night, Business Today has reported that the Government has asked Income Tax to issue a fresh notice to NDTV.
NDTV’s founders Prannoy Roy and Radhika Roy are presently facing CBI charges for cheating ICICI Bank and another FIR for opening shell firms across the World to round trip the funds. In both cases, CBI has not yet filed Chargesheets.
The 32-page Supreme Court Order is published below:
NDTV_27766_2017_0_1503_21584_Judgement_03-Apr-2020 by PGurus on Scribd
 NDTV suppressed Rs.1107 crores profit from Income Tax authorities – Oct 1, 2017, PGurus.com
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