SC Declines to Intervene in Delayed Income Tax Reassessment Challenge, Affirms Duty to Cooperate with Authorities [Read Order]

In a recent ruling, the Supreme Court refused to interfere with the writ petition that had been filed more than a year after the reassessment order and without furnishing the required information under Section 142(1) of the Income Tax Act, and affirmed the duty to cooperate with the authorities.

The case revolves around the petitioner, TMEN Systems Private Limited’s challenge to income tax reassessment proceedings for AY 2020-21.

The company contended that the notice dated 21 March 2024 under Section 148A(b) was vague, scanty, and non‑specific, issued in complete absence of material suggesting escapement of income chargeable to tax and also submitted that the order dated 12 April 2024 under Section 148A(d) was based on a verification report that had no nexus with the petitioner, making the proceedings arbitrary.

It was also mentioned in the High Court order that, despite repeated requests, the tax authorities had not provided a party‑wise breakup of ₹3.16 crore, leaving the assessee unable to reconcile the figures with its books of accounts. It is stressed that the reassessment notices violated the principles of natural justice and constitutional guarantees under Articles 14, 19(1)(g), 265, and 300A.

On the other hand The respondents, represented by the Senior Standing Counsel Siddhartha Sinha, argued that the petition was highly delayed, having been filed almost one and a half years after the order dated 12 April 2024 under Section 148A(d).

The revenue pointed out that despite repeated opportunities, TMEN Systems had not furnished the details sought under Section 142(1), particularly regarding transactions with 126 entities.

The High Court held that the appropriate course was for the petitioner to appear before the Assessing Officer (AO) and make submissions on facts and law, relying on the Supreme Court precedent in Dehri Rohtas Light Rly. Co. Ltd. v. District Board, Bhojpur (1992)

The Supreme Court bench of Justice Manoj Misra and Justice Manmohan condoned the delay in refilling but refused to interfere under Article 136, dismissing the special leave petition. The Court observed:

“We do not find a good ground to interfere with the impugned order/judgment in exercise of our jurisdiction under Article 136 of the Constitution of India. Accordingly, the special leave petition stands dismissed.”

Accordingly, the petition was disposed of

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