IT Act Section 138 overrides RTI Act for tax information disclosure, PM CARES Fund protected

Delhi HC held that IT Act prevails over RTI Act regarding disclosure of assessee information. The court ruled that Section 138 of IT Act, being a special provision requiring satisfaction of specified tax commissioners before disclosing third-party information, overrides Section 22 of RTI Act. Information sought about PM CARES Fund approval from Income Tax Department could only be disclosed following IT Act procedures, not RTI Act. Additionally, CIC failed to provide mandatory notice to PM CARES Fund as third party under Section 11 of RTI Act before ordering disclosure. The writ petition was allowed, establishing that CIC lacks jurisdiction to direct furnishing of information covered under Section 138 of IT Act.

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Issues Involved:
1. Applicability of Section 138 of the Income Tax Act, 1961 vs. Right to Information Act, 2005.
2. Exemption under Section 8(1)(j) of the RTI Act.
3. Requirement of hearing the PM CARES Fund as a third party.

Summary:

1. Applicability of Section 138 of the Income Tax Act, 1961 vs. Right to Information Act, 2005:
The petitioner, CPIO/Dy. Commissioner of Income Tax, challenged the CIC's order directing the disclosure of documents related to the PM CARES Fund under an RTI application. The petitioner argued that such information could only be sought under Section 138 of the Income Tax Act, which requires an application to the Principal Chief Commissioner or equivalent authority and their satisfaction that disclosure is in the public interest. The court agreed, stating that the IT Act, being a special law, overrides the general provisions of the RTI Act as per the principle of "generalia specialibus non derogant."

2. Exemption under Section 8(1)(j) of the RTI Act:
The petitioner contended that the information sought was personal and exempt under Section 8(1)(j) of the RTI Act, which protects personal information from disclosure unless public interest justifies it. The court noted that the CIC did not adequately adjudicate on the public interest aspect and whether the information was indeed personal. The court emphasized that the satisfaction of the IT authorities under Section 138(1)(b) of the IT Act is necessary before disclosing information, which the CIC failed to consider.

3. Requirement of hearing the PM CARES Fund as a third party:
The petitioner argued that the PM CARES Fund, being a third party, should have been given an opportunity to be heard as mandated by Section 11 of the RTI Act. The court agreed, stating that the CIC should have followed the procedure under Section 11 before ordering the disclosure of information. The court concluded that the CIC lacked jurisdiction to direct the disclosure of information protected under Section 138 of the IT Act without following the due process.

Conclusion:
The court allowed the writ petition, setting aside the CIC's order dated 27.04.2022, and emphasized the precedence of the IT Act over the RTI Act in matters of disclosing information related to income tax assessees. The failure to notify the PM CARES Fund also invalidated the CIC's order.

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