SC slams I-T department for 'gross delay of 422 days in filing' plea

Coming down heavily on the Income Tax department, the Supreme Court on Thursday said there is a ‘gross delay of 422 days in filing’ its plea and the explanation offered by the department for the delay ‘is not satisfactory and therefore, not sufficient in law to be condoned’.

With this, the court dismissed the department’s plea.

The bench of Justices BV Nagarathna and Dipankar Dutta was hearing the Special Leave Petition (SLP) filed by the Principal Commissioner of Income Tax 2 Kolkata against Usha Polychem India Private Limited.

By filing an SLP, an aggrieved party is provided special permission to be heard in the Supreme Court, in appeal against the order or judgment of any court or tribunal in the territory of India, when any substantial question of law is involved or gross injustice has been done. The limitation for filing an SLP is 90 days from the date of the High Court's order.

The bench noted that there was also a 301-day delay in filing the appeal before the High Court by the department. Condoning the same, the appeal was dismissed on merits in the High Court at the beginning of this year.

Noting the 422-day delay, the bench dismissed the application seeking condonation of the delay. “We also find no merit in the Special Leave Petition. In the result, the Special Leave Petition stands dismissed both on the ground of delay as well as on merits,” the order said.

On the same day, the bench, while hearing another case of the Commissioner of Income Tax against Spirit Global Construction Pvt Limited, said ‘there is a gross delay of 213 days in filing the SLP’. The bench was once again not satisfied with the Income Tax Department’s explanation for the delay and refused to allow the SLP.

The apex court said that the department has been filing SLPs consistently even when there is a gross delay of hundreds of days, and it appears that there is no immediate attention bestowed on the cases so as to seek urgent relief before this Court.

This comes a day after the Chief Justice of India DY Chandrachud refused to entertain an appeal by the income tax department against the Indian arm of Xerox, saying the plea was filed 215 days late.

"How can the Supreme Court condone a 215-day delay by the income tax department? What message will it send to foreign investors, like 'see SC is condoning such huge delays'? Sorry, that cannot be done. These companies are working here and provide revenues, jobs, and courts also give a signal that there has to be some balance, you see. Sorry," said Chief Justice of India (CJI) DY Chandrachud.

In January 2024, the apex court had expressed shock and surprise over the department filing an appeal four years late. The top court also said in January that in the absence of any particular period of time being prescribed to file an appeal, the same would be governed by the principle of 'reasonable time', for which, by virtue of its very nature, no straitjacket formula can be laid down and it is to be determined as per the facts and circumstances of each case.