2025 (10) TMI 1165 - SCH - Income Tax

Special leave petition dismissed as time-barred after 429-day delay; s.147 reopening requires close nexus, not vague material

The Assistant Commissioner of Income Tax Central Circle 7 (1) Mumbai & Ors. Versus Arunkumar Mahabirprasad Jatia.

SC dismissed the belated special leave petition as barred by delay (429 days) and refused to condone the delay. The Court noted settled HC law that ... Reopening of assessment u/s 147 - notice issued u/s 148A(b) as alleged that petitioner was one of the persons who claimed fictitious short-term capital loss - As decided by HC [2024 (4) TMI 1321 - BOMBAY HIGH COURT] it is settled law that it is not any and every material, howsoever vague and indefinite or distant, remote and far-fetched which would suggest escapement of the income of the assessee from assessment. Powers of the Income Tax Officer to reopen assessment, though wide, are not plenary. The Act, no doubt, contemplates the reopening of the assessment if grounds exist for believing that income of the assessee has escaped assessment. Live link or close nexus should be there between the information before the Income Tax Officer and the belief which he has to prima facie form an opinion regarding the escapement of the income of the assessee. There is nothing to indicate that petitioner had participated knowingly in a sham transaction to reduce his tax liability or to earn dividend or book short-term capital loss. HELD THAT:- Special Leave Petition is reported to be beyond time by 429 days. Further, it appears from the record that judgment which was relied upon by the High Court was also challenged before this Court in a highly belated special leave petition which too was dismissed on the ground of delay. We do not find a good reason to condone the delay and entertain the special leave petition. Special Leave Petition is accordingly dismissed on the ground of delay. The Special Leave Petition was filed 429 days beyond the prescribed period. The Court noted that the High Court's relied-upon judgment had itself been the subject of a belated Special Leave Petition to this Court, which 'was... dismissed on the ground of delay.' Given the prolonged delay and absence of a sufficient justification, the Court found no ground to exercise its discretion to condone delay. Consequently, 'The Special Leave Petition is accordingly dismissed on the ground of delay.' All pending applications stand disposed of. The order thus rests solely on procedural grounds of laches and delay without reaching the merits of the underlying controversy.