In a major relief to Oxfam India, the Delhi High Court stayed income tax department’s order cancelling tax exemption.
The counsel representing the respondents, took a preliminary objection to the maintainability of the writ petitions itself and contends that the impugned order passed by the Principal Commissioner of Income Tax ( Central ), is clearly appealable in terms of Section 253(c) of the Income Tax Act, 1961 and that since the appeal is liable to be tried by the Income Tax Appellate Tribunal, it would be entitled to consider all challenges, including those raised on jurisdictional grounds.
In so far as the aspect of retrospective application of Section 12AB(4) of the Income Tax Act is concerned, Mr. Hossain, seeks to draw sustenance from clause (ii) as placed in Section 12AB(4)(c) of the Income Tax Act to contend that the said provision on an ex facie examination enables the respondents to pass an order cancelling the registration, which may impact previous years. Insofar as this aspect is concerned, our attention has been drawn to the fact that clause (c) came to be inserted in Section 12AB(4) of the Income Tax Act by virtue of the Finance Act, 2022.
A Division Bench of Justices Yashwant Varma and Purushaindra Kumar Kaurav observed that “In view of the aforesaid, we find that a substantial jurisdictional question which merits consideration stands raised. We also bear in mind the need to adopt a uniform and consistent approach insofar as interim orders are concerned. This since an identical challenge has been duly entertained by a coordinate Bench of this Court and interim protection accorded. The Court also bears in mind that pleadings in W.P.(C) 11270/2023 already stand completed and thus the issue can be decided finally on a short date.”
“We consequently hold that the petitioners shall be entitled to interim reliefs in terms identical to those provided in paragraphs 17-19 of the aforenoted order of 25 August 2023 passed in W.P.(C) 11270/2023, subject to the clarification that the donations that may be accepted by the petitioners pursuant to the aforenoted interim directions shall be confined to domestic contributions only” the Court noted.
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