Delhi High Court Sets Aside 7 ITAT Orders In Patanjali Ayurved Tax Appeals Over Procedural Lapses

The Delhi High Court on 10 September set aside seven orders passed by the Income Tax Appellate Tribunal (ITAT) in tax appeals involving Patanjali Ayurved Limited, citing procedural lapses, non-application of mind and undue haste in passing a common order in seven appeals.

A Division Bench comprising Justices Dinesh Mehta and Rajneesh Kumar Gupta set aside the orders after the Income Tax Department challenged four of them, noting that the seven appeals had been heard and pronounced on different dates but were disposed of through a common order. The judges observed:

“We are not much concerned with the size of the order but what shocks us is, the non-application of mind and undue haste which learned Members of the Tribunal have exhibited.”

The appeals arose from proceedings under Section 153C of the Income Tax Act concerning Assessment Years 2013-14 to 2015-16 and 2017-18.

Four appeals had been heard and pronounced on 6 August 2025, while three others had been heard and pronounced on 13 August 2025. Despite this, a common order containing fewer than seven paragraphs had been passed and issued in respect of all seven appeals. The discrepancy came to light when the matter was first listed before the High Court on 2 February 2026.

Patanjali's counsel also expressed surprise and sought to verify the Tribunal's record and certified copy of the order. After verification, he submitted that there appeared to be a procedural error on the Tribunal's part, possibly due to inadvertence.

The High Court found the impugned order “bereft of any logic, reasoning or rationale” and said it was unable to comprehend how a common order could have been passed in appeals heard and pronounced on different dates.

It further remarked that the Tribunal members had shown “undue haste rather recklessness” in passing and signing the order, while the Tribunal staff had also failed to bring the discrepancy to their notice. It said that “such type of negligence cannot be countenanced.”

Consequently, the High Court set aside all seven ITAT orders, including the three orders which were not directly under challenge before it. It noted that there was no appeal against those orders, possibly due to the monetary limits prescribed by the Central Board of Direct Taxes. It restored the appeals to their original numbers for fresh consideration by the Tribunal.

For Appellant: Mr. Mr. Puneet Rai, SSC with Mr. Ashvini Kr. and Mr. Rishabh Nangia, JSCs alongwith Mr. Nikhil Jain and Ms. Nancy Jain, Advocates.

For Respondent: Mr. Vaibhav Kulkarni and Mr. Sandip Nagar, Advocates.