Delhi HC quashes IT notice against NDTV founders; imposes ₹2 lakh fine on Tax Department

The Delhi High Court on Monday set aside the income tax reassessment notices issued in March 2016 to NDTV founders Prannoy Roy and Radhika Roy over allegations linked to certain interest-free loans extended to RRPR Holding Pvt Ltd, the promoter entity of NDTV. A Division Bench comprising Justices Dinesh Mehta and Vinok Kumar also imposed costs of ₹2 lakh on the Income Tax Department, directing it to pay ₹1 lakh each to the two petitioners. The court held that while no amount could truly compensate the petitioners, a token cost was warranted, and quashed not only the notices dated March 31, 2016, but also all proceedings arising from them.

The reassessment proceedings stemmed from allegations concerning interest-free loans advanced to RRPR Holding Pvt Ltd. The Roys had moved the High Court in November 2017, contending that the reassessment amounted to a second reopening for the same assessment year, despite the department having already reopened the matter in July 2011 and examined the same issues, culminating in a reassessment order in March 2013. They argued that once reassessment is initiated, the entire under-assessed income is open to scrutiny, and that reopening the same issue again constituted an impermissible change of opinion. The court was also informed that similar proceedings against RRPR Holding Pvt Ltd are pending before the High Court, with a stay on final orders, and that a separate bench had quashed the notice issued to RRPR in September 2024. Senior Advocate Sachit Jolly, along with advocates Yiyushti Rawat, Devansh Jain and Sarthak Abrol, appeared for the petitioners, while advocates NP Sahni, Indraj Singh Rai, Sanjeev Menon, Rahul Singh and Gourav Kumar represented the Income Tax Department.