PM CARES Fund: Delhi HC Overturns CIC Order Directing Disclosure Of Tax Exemption Details

The Delhi High Court on Monday overturned a Central Information Commission (CIC) directive instructing the income-tax department to disclose information regarding the tax exemption status granted to the PM CARES Fund. The court highlighted that the Income Tax Act takes precedence over the Right to Information (RTI) Act, stating that information related to an assessee could only be divulged under special circumstances.

In response to an appeal by the income-tax department, the court ruled against the April 2022 CIC order, which mandated the release of documents submitted in the exemption application filed by the PM CARES Fund. The judgment highlighted specific sections of the Income Tax Act, asserting that they override corresponding provisions in the RTI Act.

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Justice Subramonium Prasad, in a 23-page order, stated, "The CIC does not have the jurisdiction to direct furnishing of information, provided for in Section 138 of the IT Act. In any case, even if they had the jurisdiction, the failure to give PM CARES notice of hearing would in itself have vitiated the impugned."

“Section 138 (1)(b) and Section 138 (2) of the IT Act which lays down a specific procedure relating to disclosure of information relating to a third party under the IT Act would override Section 22 of the RTI Act. The information sought by the Respondent herein is covered by Section 138(1)(b) of the IT Act. The satisfaction of Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner is, therefore, necessary before such information can be divulged,” the bench said.

The court stressed that satisfaction from the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner is necessary before divulging information covered by Section 138(1)(b) of the IT Act.

The income-tax department, represented by special counsel Zoheb Hussain, argued that information related to an assessee could only be sought under the prescribed procedures of the Income Tax Act, not the RTI Act. The department maintained that the information sought was exempted under the RTI Act and required a hearing from the PM CARES Fund.

The applicant, Girish Mittal, a right-to-information applicant, represented by advocate Pranav Sachdeva, contended that public interest warranted the release of information, seeking details about the procedure followed by the I-T department in granting approval and ensuring compliance with relevant rules in the exemption process.

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Mittal had asked for copies of all documents submitted by the PM Cares Fund in its exemption application, copies of file notings approving, list of all the exemption applications filed before the IT Department from 1st April 2019 till 31st March 2020 along with the date of filing and date on which they were granted an exemption and any application that had been rejected along with reasons for rejection.