Delhi Tax Bar Association Through Its Secretary K G Bansal vs Union Of India & Anr.

$~8
* IN THE HIGH COURT OF DELHI AT NEW DELHI
nd
Date of Decision: 22 July, 2026
+ W.P.(C) 9365/2026, CM APPL. 43745/2026 &CM APPL. 43746/2026
DELHI TAX BAR ASSOCIATION THROUGH ITS SECRETARY K
G BANSAL .....Petitioner
Through: Mr. Sachit Jolly, Sr. Advocate with
Mrs. Mansha Anand, Mr. Sohum Dua,
Mr. Abyudaya Shankar Bajpai, Ms.
Saloni Ray, Mr. Ghunaim Siddiqui,
Ms. Manvi and Mr. Ramanand Roy,
Advocates.
versus
UNION OF INDIA & ANR. .....Respondents
Through: Mr. Shlok Chandra, SSC along with
Ms. Naincy Jain and Ms. Madhavi
Shukla, JSCs and Mr. Udit Dad,
Advocate for R-2.
Ms. Arti Bansal, CGSC along with
Ms. Shruti Goel, Advocate for R-1.
CORAM:
HON'BLE MR. JUSTICE DINESH MEHTA
HON'BLE MR. JUSTICE RAJNEESH KUMAR GUPTA
J U D G M E N T
Per DINESH MEHTA, J. ( Oral )
1. By way of the present writ petition, the petitioner-Delhi Tax Bar
Association has assailed the Office Memorandum dated 12.09.2025,
issued by the Central Board of Direct Taxes (hereinafter referred to as
W.P.(C) 9365/2026 Page 1 of 7
Signature Not Verified
Signed By:VAISHALI
CHAUHAN
Signing Date:22.07.2026
20:43:44

‘CBDT’) giving clarification in relation to allowances payable to
Judges of the High Courts under Section 22D of the High Court
Judges (Salaries and Conditions of Service) Act, 1954 (hereinafter
referred to as ‘the Act of 1954’) in the backdrop of the provisions of
Section 115BAC of the Income Tax Act, 1961 (Section 202 of the
Income Tax Act, 2025).
2. Apprising the Court about the locus of the petitioner, Mr. Sachit
Jolly, learned Senior Counsel informed that the members of the
petitioner-association not only file returns of income of Hon’ble
Judges of the High Court and the Supreme Court, but also advise them
in relation to their investment and tax related issues. He added that the
members of the Bar are equally concerned with overall judiciary, its
dignity and independence.
3. Having regard to the issue involved, before proceeding to hear
the matter, as a judicial propriety we deem it our duty to make a
disclosure that so far Hon’ble Mr. Justice Rajneesh Kumar Gupta is
concerned, he has already filed his return of income, though under
new regime but without claiming exemption of the contentious
allowances and so far as author of the order (Justice Dinesh Mehta) is
concerned, though he is yet to file his return of income but would be
filing return under the old regime, so that the issue in hands does not
personally affect or influence his decision or discretion in any manner.
4. Learned Senior Counsel submitted that as per Section 22D of the
W.P.(C) 9365/2026 Page 2 of 7
Signature Not Verified
Signed By:VAISHALI
CHAUHAN
Signing Date:22.07.2026
20:43:44

High Court Judges Act, 1954 and 23D of Supreme Court Judges Act
(Salaries and Conditions of Service) 1958, notwithstanding the
provision of Income Tax Act, allowance payable under Section 22A,
22B and 22C and Leave Travel Concession provided to Hon’ble
Judges of High Court and Supreme Court are totally excluded from
the computation of their income chargeable under the head salary
under Section 15 of the Act of 1961.
5. He submitted that impugned Office Memorandum seeks to take
away the vested right of Hon’ble Judges of the High Court and on
similar analogy the allowances payable to Hon’ble Judges of the
Supreme Court are also likely to be taken away in the new regime
under the Act of 1961/2025.
6. He argued that the Office Memorandum is violative of Article
125 and 221 of the Constitution, which guarantee that the allowances
and salaries of Judges of the Supreme Court and High Court shall not
be curtailed or varied to their detriment from the date of their
appointment.
7. Impeaching the Memorandum, learned Senior Counsel argued
that the CBDT has ruled, that after introduction of new regime, the
allowances such as Rent-Free Official Residence, Conveyance
Allowance, Sumptuary Allowances and Leave Travel Concession
(hereinafter ‘cumulative by referred to as the allowances’) shall not be
exempted, because the new regime provides moderate rate of tax, with
W.P.(C) 9365/2026 Page 3 of 7
Signature Not Verified
Signed By:VAISHALI
CHAUHAN
Signing Date:22.07.2026
20:43:44

no deduction and exemption.
8. Laying emphasis over the language used in Section 22D and
23D of the above Acts of 1954 and 1958, learned Senior Counsel
submitted that they use a different and unique expression; they do not
provide or talk of any ‘deduction’ or ‘exemption’; they rather take the
allowances out of the purview or ambit of Section 15 of the Act of
1961. Meaning thereby, there cannot be treated to be any deduction or
exemptions in any manner so far as ‘these allowances’ given to
Hon’ble Judges are concerned. He submitted that other allowances not
covered by Section 22D/23D are obviously taxable.
9. He, therefore, argued that regardless of introduction of new
regime in the form of Section 115BAC in the Act of 1961 or 202 in the
Act of 2025, these allowances shall continue to be out of the tax-net.
He iterated that the CBDT’s Office Memorandum dated 12.09.2025 is
clearly contrary to law, while maintaining that it is nothing short of
interference in the independence of judiciary. He submitted that
because of the Office Memorandum or otherwise, the new
Format/Software (Returns Preparation Utility or RPU) does not
provide any drop box or facility/utility where exemption or deduction
can be claimed, in case an assessee opts for new regime.
10. He informed that in the new utility of e-filing, once Heading
‘Exempt Income’ is selected from the Dashboard, there appears a
category ‘other Income’, in which sub-category ‘Receipts not in the
W.P.(C) 9365/2026 Page 4 of 7
Signature Not Verified
Signed By:VAISHALI
CHAUHAN
Signing Date:22.07.2026
20:43:44

nature of income’ and prayed that by way of interim direction it may
be ordered that all the Hon’ble Judges may file their return of income
under New Regime reflecting these allowances under sub-category
‘Receipts not in the nature of Income’ and subject to final outcome
their returns of income be accepted.
11. Mr. Shlok Chandra, learned Senior Standing Counsel for the
respondents prays for and is granted two weeks’ time to file reply.
Rejoinder thereto, if any, be filed within two weeks thereafter.
12. Heard on stay application.
13. Section 22D in The High Court Judges (Salaries And Conditions
Of Service) Act, 1954 reads as thus:
“22D. Exemption from liability to pay income-tax
on certain perquisites received by a Judge.—
Notwithstanding anything contained in the Income-tax
Act, 1961 (43 of 1961),—
(a) the value of rent-free official residence provided to
a Judge under sub-section (1) of section 22A or the
allowance paid to him under sub-section (2) of that
section;
(b) the value of the conveyance facilities provided to a
Judge under section 22B;
(c) the sumptuary allowance provided to a Judge under
section 22C; (d) the value of leave travel concession
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Signature Not Verified
Signed By:VAISHALI
CHAUHAN
Signing Date:22.07.2026
20:43:44

provided to a judge and members of his family,
shall not be included in the computation of his income
chargeable under the head “Salaries” under section
15 of the Income- tax Act 1961 (43 of 1961).”
14. Having considered the submissions of Mr. Jolly, in prima facie
opinion of this Court, the non-obstante clause in Section 22D and 23D
gives Section 22D/23D overriding effect over all the provisions of the
Income-Tax Act, 1961, including Section 115BAC. That apart, the
expression used in Section 22D drives the allowances even outside the
computation of income under the head salaries-‘an amount which is
not even included in the income cannot be said to have been exempted
or deducted’ so as to fall foul of Section 115BAC of the Act of 1961.
15. Matter requires consideration.
16. Meanwhile, all Hon’ble Judges of Supreme Court and High
Court may file their return of income/Revised Return reflecting the
amount allowance covered by 22D and 23D of the Act of 1954 and
1958 under the caption ‘receipts not in the nature of income’ by going
to ‘Exempt Income’ part of the Dashboard and then opting category
‘other incomes’ and sub-category ‘receipts not in the nature of
income’, while furnishing their return of income.
17. The returns so filed by Hon’ble Judges of the High Court and
Supreme Court shall not be processed and proceeded with, until
W.P.(C) 9365/2026 Page 6 of 7
Signature Not Verified
Signed By:VAISHALI
CHAUHAN
Signing Date:22.07.2026
20:43:44

further orders.
18. List on 03.09.2026.
DINESH MEHTA
(JUDGE)
RAJNEESH KUMAR GUPTA
(JUDGE)
JULY 22, 2026/ v
W.P.(C) 9365/2026 Page 7 of 7
Signature Not Verified
Signed By:VAISHALI
CHAUHAN
Signing Date:22.07.2026
20:43:44