The Delhi High Court has quashed the income tax reassessment notices issued in March 2016 to NDTV founders Prannoy Roy and Radhika Roy, and directed the Income Tax department to pay a token cost of ₹2 lakh on the Income Tax Department, stating that ₹1 lakh be paid to each of the petitioners.
“Both the writ petitions are allowed. Notices dated March 31, 2016, issued to the petitioners and any consequent order or proceedings thereto are quashed,” noted the court. The reassessment notices related to alleged interest-free loans extended to RRPR Holding Pvt. Ltd., a promoter group company of NDTV. The court also quashed all consequential proceedings arising from the impugned notices.
A Division Bench of Justices Dinesh Mehta and Vinod Kumar held that the tax department’s attempt to reopen the assessments was impermissible as the same transactions had already been examined during an earlier reassessment. The bench agreed with the Roys that reopening the matter amounted to an unlawful “change of opinion” under the Income Tax Act.
The Roys had approached the High Court in November 2017, contending that the reassessment constituted a second reopening for the same assessment year. They pointed out that the department had already reopened their assessment in July 2011, which concluded with a reassessment order in March 2013. The court accepted the submission that issues examined in a completed reassessment cannot be revisited.
The bench, imposed costs on the tax authorities, observing that while no amount could fully compensate for such proceedings, it was necessary to levy a token penalty. The court also rejected the department’s claim that the earlier reassessment was limited in scope, noting that once reassessment proceedings are initiated, the entire under-assessed income may be scrutinised.
The court also took note of parallel reassessment proceedings against RRPR Holding Pvt. Ltd., which are pending before the High Court with final orders stayed. A separate bench had quashed the reassessment notice issued to RRPR in September 2024.
Senior advocate Sachit Jolly appeared for the Roys, while the Income Tax Department was represented by its counsel. The bench reiterated that reopening an assessment on the same material after a completed reassessment is not permitted in law.
