SLP Filed Merely to Get ‘Stamp of this Court’: Supreme Court Rejects Income Tax Dept Plea Against Adani Power [Read Judgement]
The Supreme Court dismissed the Income Tax Department’s SLP against Adani Power mainly due to a delay of 426 days, saying the explanation given for the delay was vague
The Supreme Court refused to consider the Income Tax Department’s Special Leave Petition against Adani Power Limited, saying that “it appears that the instant special leave petition has been filed only to get the stamp of this Court.”
The case came from a decision by the Gujarat High Court on August 5, 2024, where the court canceled the reassessment notice issued and also the order rejected Adani Power's objections.
The revenue department then filed a Special Leave Petition in the Supreme Court against that High Court decision. The petition was filed with a delay of 426 days, and the department asked for forgiveness by explaining that the delay happened because of administrative and departmental procedures.
In front of the Gujarat High Court, Adani Power argued that the reassessment started without any new real evidence and was based only on records already checked during the original scrutiny assessment under Section 143(3). The company also said that since the reopening was more than four years after the end of the relevant assessment year, it wasn't valid because there was no failure on their part to disclose all material facts fully and truly.
The revenue argued that Adani Power wrongly claimed extra depreciation on foreign exchange changes related to imported plant and machinery. The department said that additional depreciation under Section 32(1)(iia) is allowed only on new plant and machinery bought and used during the year, and not on increases in value of old assets due to exchange rate changes. They claimed income had escaped assessment and reassessment was justified.
The Gujarat High Court noted that the reasons for reopening showed the Assessing Officer relied only on material already on record. The court said there was no fresh real evidence and the reopening was just a change of opinion. The High Court also pointed out that since the reopening happened after four years, the Revenue needed to show a failure by the assessee to disclose material facts, which wasn't in the reasons recorded.
Based on this, the High Court canceled the reassessment notice and the order rejecting the objections.
The matter then went to the Supreme Court. The Bench including the Chief Justice of India and Justices Joymalya Bagchi and Vipul M. Pancholi said that the view taken by the Gujarat High Court on the merits didn't need any changes. The court also found the explanation for the 426-day delay vague and not acceptable.
The Supreme Court dismissed the Special Leave Petition because of the delay as well as on merits. The Court said the petition seemed filed merely to get the stamp of this Court. The Gujarat High Court judgment in favor of Adani Power Limited has now become final.Support our journalism by subscribing to Taxscanpremium. Follow us on Telegram for quick updates
