Estman Industries Ltd. V. UOI & ANR.

W.P.(C)/2213/2007

AI Insights

In the writ petition W.P.(C) 2213/2007, Estman Industries Ltd. challenged the validity of a notice and an order issued under the Income Tax Act, 1961, concerning the retrospective application of Section 80HHC. The petitioner argued that the retrospective effect given to this section was unconstitutional, a position supported by a previous Supreme Court decision in Commissioner of Income Tax v. Avani Exports. The Delhi High Court, referencing this Supreme Court judgment and a related Gujarat High Court decision, found in favor of the petitioner, quashing the notice and order in question.

• Counselvise Citation: [] 140 COUNSELVISE.COM (IT) 832406 (HC-DELHI)
• Appeal Type: Others
• Pronouncement Date: 21-01-2026
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income Tax v. Avani Exports, Saroj Dassani v. UOI
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: BHAGWAN SWARUP SHUKLA; PRAVEEN GUPTA
• Keywords: Gujarat High Court; Income Tax; Notice; Order; Retrospectivity; Supreme Court; Ultra Vires
• Section: 148; 143(2); 80HHC; 143(3)(iii)

Judgement Text

"$~67 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 2213/2007 ESTMAN INDUSTRIES LTD. .....Petitioner Through: None. versus UOI & ANR. .....Respondents Through: Mr. Bhagwan Swarup Shukla, CGSC with Mr. Praveen Gupta, Adv. CORAM: HON'BLE MR. JUSTICE DINESH MEHTA HON'BLE MR. JUSTICE VINOD KUMAR O R D E R % 21.01.2026 1. By way of present writ petition, the petitioner has challenged the notice dated 12.12.2005 under Section 143(2) so also the order dated 19.01.2006 under Section 148/143(3)(iii) of the Income Tax Act, 1961 (hereinafter referred to as „the Act of 1961‟). 2. Retrospectivity given to Section 80HHC of the Act of 1961 has been held to be ultra vires by the Gujarat High Court and affirmed by Hon’ble the Supreme Court in the case of Commissioner of Income Tax v. Avani Exports reported in (2015) 232 Taxman 357 (SC). 3. Following the same in W.P.(C) No. 16816/2006 (Saroj Dassani v. UOI), this Court has held thus :- “5. If the judgment dated 30.03.2015 passed by Hon‟ble the Supreme Court in Avani Exports (supra) is read in conjunction with the judgement of the Gujarat High Court dated 02.07.2012, it is clear that the finding recorded in para 26, reproduced This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/01/2026 at 12:28:24 Printed from counselvise.com hereinabove, was upheld with some alteration in para 27 of the said judgment, that too in favour of the assessees and direction given in para 27 of aforesaid judgment was substituted by the following: “Having seen the twin conditions and since 80HHC benefit is not available after 1.4.05, we are satisfied that cases of exporters having a turnover below and those above 10 cr. Should be treated similarly. This order is in substitution of the judgment in Appeal”. 6. The consequence of the judgment dated 30.03.2015 of Hon‟ble the Supreme Court, is that irrespective of the amount involved, the amendment brought in Section 80HHC of the Act of 1961 cannot be given retrospective effect.” 4. In the light of the judgment of Avani Exports (supra) Hon’ble the Supreme Court and reasoning given in Saroj Dassani (supra), the impugned notice dated 12.12.2005 so also the order dated 19.01.2006, is hereby quashed. The petition is allowed. 5. Pending applications (if any) are disposed of. DINESH MEHTA, J. VINOD KUMAR, J. JANUARY 21, 2026/sr This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/01/2026 at 12:28:24 Printed from counselvise.com "