The Supreme Court dismissed the Special Leave Petition ( SLP ) against the challenge on the Income Tax Appeal. The SLP arose out of the impugned final judgment and order passed by the Delhi High Court.
Clix Capital Services Private Limited, the petitioner challenged the order passed by the respondent/revenue disposing of the petitioner’s representation for initiation of the penalty imposed under Section 271C of the Income Tax Act, 1961 [ “Act” ] before the Delhi High Court.
The Court remitted the matter to the respondent/revenue, with a direction to dispose of the petitioner’s representation, which inter alia, concerned wrongful assumption of jurisdiction by the respondent/revenue. It is this direction, which led to the issuance of the order dated 14.06.2018.
Since there was no movement in the matter, the Assessing Officer ( AO ) sent a reminder on 11.07.2014. It appears, that thereafter, the respondent/revenue became somnambulant, and the SCN was issued only on 09.11.2017, as per the mandate of Section 274 of the Act. Accordingly, the petitioner was called upon to show cause, as to why a penalty ought not to be imposed under Section 271C of the Act, qua AY 2007-08.
The High Court held that “the delay in issuing the impugned SCN was inexcusable. There is no explanation, whatsoever, available on the record, as to why the SCN under Section 274 of the Act was not issued in 2013-14, if not earlier. There is no explanation, even concerning the period falling between the time when the scrutiny assessment was framed [i.e., on 28.10.2011] and the communication dated 09.09.2013.”
A two-judge bench comprising Justice Abhay S Oka and Justice Ujjal Bhuyan observed that “there is no case for interference is made out in the exercise of our jurisdiction under Article 136 of the Constitution of India. The Special Leave Petition is, accordingly, dismissed. The pending application also stands disposed of.”
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