Delhi HC Quashes CIC’s Order Directing IT Dept. to Provide Info. Related to PM CARES Fund

Case Details: CPIO/Deputy Commissioner of Income-tax, HQ. Exemption vs. Girish Mittal - [2024] 158 taxmann.com 549 (Delhi)

Judiciary and Counsel Details

• • Subramonium Prasad, J.
  • Zoheb Hossain, Sajeev Menor & Vivek Gurnani, Advs. for the Appellant.
  • Pranav Sachdeva, Jatin Bhardwaj & Aakriti, Advs. for the Respondent.

Facts of the Case

An application under the RTI Act was filed seeking the procedure followed in granting exemption under section 80G of the Income-tax Act (IT Act) to the PM CARES Fund by the Income Tax Department (I-T Dept.). It was contended that he wanted to know the exact procedure followed by the Income Tax Department in granting such a swift approval and to see whether any rules or procedures were by-passed in granting such approval.

The Central Information Commission (CIC) ordered the I-T dept. to grant information as demanded by the applicant. Aggrieved by such an order, the I-T Dept filed a writ petition before the Delhi High Court.

High Court Held

The High Court held that section 138(1) of the IT Act provides that when a person makes an application in the prescribed form for any information relating to an assessee, the respective authority may, if he is satisfied that it is in the public interest to do so, furnish or cause to be furnished the information asked for.

Further, sub-section (2) to section 138 contains a non-obstante clause which states that notwithstanding anything contained in sub-section (1) or any other law for the time being in force, direct that no information or document shall be furnished or produced by a public servant in respect of such matters relating to such class of assessees or except to such authorities as may be specified in the order.

The RTI Act also has a non-obstante clause in the form of Section 22, which says that the provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in the Official Secrets Act, 1923 and any other law.

A reading of both Acts shows that there is an inconsistency between the provisions of the RTI Act and the IT Act. Therefore, the question which arises for consideration is which Act will prevail.

The Income Tax Act focuses on specific provisions and laws concerning income tax. At the same time, the RTI Act is a general law that addresses providing information to citizens, facilitating their Right to Information.

Ordinarily, if there are two non-obstante clauses, the latter prevails over the former. At the same time, the applicability and overriding effect of an Act over other statutes cannot be decided merely by when the concerned Act comes into force. It is for the Courts to discern and interpret which Act will prevail over the other.

Thus, the Delhi High Court held that the IT Act, which is a special Act governing all the provisions and laws relating to income tax and super-tax in the country, will prevail over the RTI Act, which is in the nature of a General Act.

Further, the petitioner sought information from the Income Tax Department, not from the PM CARES Fund. As the requested information pertains to a third party, PM CARES Fund should have been given an opportunity to be heard according to Section 11 of the RTI Act. The CIC should have followed the prescribed procedure under Section 11 before ordering the release of information.

Accordingly, the CIC lacks the authority to instruct the release of information under Section 138 of the IT Act. Even if it had such jurisdiction, the failure to notify PM CARES of the hearing would invalidate the decision.