Income Tax Refund of Educational Institution: SC Modifies P&H HC Order by Reducing Appeal Disposal Time from 1 year to 2 months [Read Order]
The Supreme Court modified the High Court’s order and directed the appellate authority to ensure that the appeal is heard and disposed of within two months from the date of order.
Educational - institutions - Taxscan
Educational - institutions - Taxscan
The Supreme Court has directed the expeditious disposal of its income tax appeal concerning a large income tax refund claim of the Dalhousie Public School Educational Society.
The apex court modified a Punjab and Haryana High Court order dated 15 May 2025, which had directed that the society’s appeal be decided within one year, and instead mandated that the appeal be disposed of within two months.
The society’s refund claim was rejected by the Assistant Commissioner of Income Tax (Exemptions), Chandigarh, through an order dated 17 March 2025.
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The society approached the Punjab & Haryana High Court challenging the officer’s decision seeking quashing of the rejection order and the related enquiry letter.
The High Court, while declining to interfere, observed that the petitioner had a statutory remedy of appeal under Section 246-A of the Income Tax Act, 1961.
It permitted the institution to avail such remedy, adding that the appeal must be decided expeditiously and within the statutory period of one year, keeping in view the peculiar difficulties of educational institutions in refund matters.
The petitioner’s counsel, Ms. Vibhooti Malhotra, informed the Court that the society had already filed a statutory appeal before the National Faceless Appeal Centre. The bench comprising Justice J.B. Pardiwala and Justice R. Mahadevan observed that further delay would cause undue hardship, especially since the matter involved substantial refund claims crucial for the functioning of an educational institution.
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Accordingly, the Supreme Court modified the High Court’s order and directed the appellate authority to ensure that the appeal is heard and disposed of within two months from 11 August 2025. The Court clarified that the authority must pass an appropriate order in accordance with law within this expedited timeframe.
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