Section 115BBE of Income Tax Act cannot be held Unconstitutional on ground that there is Apprehension of Misuse: Delhi HC [Read Order]

The Delhi High Court in a significant ruling held that Section 115BBE of the Income Tax Act, 1961 cannot be held unconstitutional on ground that there is apprehension of misuse.

The present writ petitions have been filed challenging the orders dated 25th July, 2022 passed under Section 148A(d) of the Income Tax Act, 1961 for the Assessment Years 2015-16, 2016-17, 2017-18 and further challenging the notices dated 25th July, 2022 issued under Section 148 of the Income Tax Act. The petitioner further challenges the constitutional validity of Section 115BBE of the Income Tax Act.

The counsel for the Petitioner stated that the notices issued under Section 148 of the Income Tax Act have been issued after three years from the end of the relevant Assessment Years and that too could have been issued after obtaining the sanction from the Principal Chief Commissioner of Income Tax and not from the Principal Commissioner of Income Tax as has been done in the present cases.

The counsel for the Respondents-Revenue, stated that in the present cases, after passing of the order under Section 148A(d) of the Act, final assessment orders have been passed on 9th May, 2023, 27th April, 2023 and 18th May, 2023 for the Assessment Years 2015-16, 2016-17, 2017-18 respectively and further stated that the issue of limitation, being a mixed question of fact and law in the present batch of matters, should be raised before the Appellate Authorities.

A Division Bench comprising Acting Chief Justice Manmohan and Justice Mini Pushkarna observed that “Consequently, at this stage, Section 115BBE of the Income Tax Act cannot be held unconstitutional on the ground that there is an apprehension of misuse of the said provision. Further, it is settled law that the Income Tax Act provides a complete machinery for assessment/re-assessment of tax and the assessee is not permitted to abandon that machinery to invoke jurisdiction of the High Court under Article 226 of the Constitution.”

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