MR VIPAN SAINI V. OFFICE OF THE ASSISTANT COMMISSIONER OF INCOME TAX ACIT/DCIT CEN CIR, PTL. GOVERNMENT OF INDIA MI

W.P.(C)/9416/2024

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Mr. Vipan Saini, the petitioner, challenged the validity of notices issued under Section 226(3) of the Income Tax Act, 1961, related to dues owed by Ekom Exim Private Limited, a company where he was a director until May 4, 2018. The notices were issued following the non-payment of these dues, which pertained to the Assessment Year 2016-17. The petitioner argued that he did not receive an earlier notice due to it being directed to his email's spam folder. The court found it necessary for the petitioner to demonstrate that the non-recovery of dues was not due to his gross neglect, misfeasance, or breach of duty, and thus allowed him to make a representation under Section 179 of the Act.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 670939 (HC-DELHI)
• Appeal Type: Others
• Pronouncement Date: 11-07-2024
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: ANURAG OJHA; V K SAKSENA; HAMLATA ANAND; ARUN AGGARWAL; SHIVAM SAINI; PRAGUL RAWAT
• Assessee Lawyers: A P SINGH; VIJAY CHAUHAN; SHYAM KUMAR
• Keywords: Director; Income Tax Department; Misfeasance; Writ petition; Impugned notices; Non-recovery of dues; Gross neglect; Breach of duty
• Section: 226(3); 179

Judgement Text

"$~85 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 9416/2024 MR VIPAN SAINI .....Petitioner Through: Mr. A.P. Singh, Mr. Vijay M. Chauhan and Mr. Shyam Kumar, Advocates. versus OFFICE OF THE ASSISTANT COMMISSIONER OF INCOME TAX ACIT/DCIT CEN CIR, PTL. GOVERNMENT OF INDIA MINISTRY OF FINANCE INCOME TAX DEPARTMENT & ORS. .....Respondents Through: Mr. Anurag Ojha, Sr. SC with Mr. V K Saksena and Ms. Hamlata Anand, Standing Counsels. Mr. Arun Aggarwal, Mr. Shivam Saini and Mr. Pragul Rawat, Advocates for R-3. CORAM: HON'BLE MR. JUSTICE YASHWANT VARMA HON'BLE MR. JUSTICE RAVINDER DUDEJA O R D E R % 11.07.2024 CM APPL. 38632/2024 (Ex.) Allowed, subject to all just exceptions. This application stands disposed of. W.P.(C) 9416/2024 & CM APPL. 38631/2024 (interim stay) 1. The writ petitioner assails the validity of the impugned notices dated 14 June 2024 issued under Section 226(3) of the Income Tax Act, 1961 [‘Act’]. 2. It is the case of the writ petitioner that he was a Director in 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 19/07/2024 at 15:21:35 Ekom Exim Private Limited and from which office he ultimately resigned on 04 May 2018. It appears that the aforenoted company owed dues to the Income Tax Department [‘Department’] and those liabilities have not been liquidated till date. 3. It is this which had constrained the respondent no. 1 to issue notice to the writ petitioner dated 24 November 2023. According to the writ petitioner, it could not respond to the notice dated 24 November 2023 since the same, for some inexplicable reason, went to the spam folder of his e-mail account. It is only thereafter that the impugned notices came to be issued. 4. Admittedly, the demands outstanding against the aforenoted company pertain to Assessment Year [‘AY’] 2016-17 and at which time the petitioner was admittedly a Director. It is in the aforesaid backdrop that we find that it would be incumbent upon the petitioner to prove and establish that the non-recovery of the dues payable to the Department cannot be attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the affairs of the company. 5. In view of the above and in our considered opinion, the ends of justice would merit the petitioner being accorded an opportunity to approach the first respondent and make a representation if he seeks to place its case within the exclusionary ambit of Section 179 of the Act and be able to establish that non-payment is not attributable to any act of gross neglect, misfeasance or breach of duty on his part. 6. We accordingly dispose of this writ petition according liberty as aforesaid. In case any such representation is made within a period of two weeks from today, the same may be duly examined and disposed of by the first respondent within a period of three weeks therefrom. The first respondent shall also afford an opportunity of hearing to the 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 19/07/2024 at 15:21:35 writ petitioner. 7. All rights and contentions of respective parties are kept open. 8. Dasti. YASHWANT VARMA, J. RAVINDER DUDEJA, J. JULY 11, 2024/vp 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 19/07/2024 at 15:21:35 "