The Hon’ble Delhi High Court has allowed the writ petitions filed by Radhika Roy and Prannoy Roy, challenging the initiation of reassessment proceedings under Section 148 of the Income-tax Act, 1961, in relation to interest-free loans received from RRPR Holdings Private Limited. The Court has quashed the impugned notices and all consequential orders and proceedings arising therefrom.

It was argued that the said transaction had already been the subject matter of the original reassessment proceedings, during which true and complete disclosure of all relevant details was made by the assessees. In light of this, the Assessing Officer (AO) did not make any disallowance in the original proceedings. It was further contended that a mere change of opinion on the part of the AO cannot constitute a valid basis for reopening the assessment when all material facts had been duly disclosed by the assessee.

The Hon’ble Delhi High Court has held that no new facts had come to the notice of the AO or the assessee, and that the initiation of reassessment proceedings on the allegation that the petitioner had failed to truly and fully disclose all material facts is itself bad in law. The High Court further held that subjecting the petitioner to reassessment proceedings for a second time, for the selfsame transaction and practically on the same issue, is arbitrary and without jurisdiction. The Court observed that the actions of the respondents fall foul of the fundamental and constitutional rights guaranteed under Articles 14, 19(1)(g), and 300A of the Constitution of India.

While allowing the instant writ petitions, the Court observed that no amount of costs could be considered adequate in such cases and accordingly imposed a token cost of INR 1,00,000 to be paid by the revenue to each of the petitioners.

The Petitioners (Radhika Roy and Prannoy Roy) were represented by Senior Advocate Sachit Jolly, along with DMD advocates led by Viyushti Agarwal, Devansh Jain, and Sarthak Abrol.