Case Law Details
Tata Project Provident Fund Trust Vs PCIT (Supreme Court of India)
Supreme Court of India dismissed the special leave petition filed against the judgment of the Telangana High Court, thereby affirming the High Court’s refusal to interfere with the rejection of a time-barred revision application under Section 264 of the Income-tax Act, 1961. While the delay in approaching the Supreme Court was condoned, the Court declined to interfere on merits and dismissed the petition, letting the High Court’s decision stand.
Read HC Judgment: IT Revision Application Rejected Due to 7 Year Delay Without Sufficient Cause
Before the Telangana High Court, the issue arose from a revision petition filed on 28.10.2024 against rejection of a rectification application dated 01.12.2016, relating to disallowance of exemption under Section 10(25) for Assessment Year 2014–15. The rectification rejection had been uploaded on the Income Tax portal on 01.12.2016. The revision was rejected by the Principal Commissioner of Income Tax on 01.08.2025 on the ground of inordinate delay of about 91 months, coupled with gross negligence and laches.
The petitioner Trust contended that it was unaware of the rectification rejection since the communication was sent to the email ID of a former employee and claimed that exemption under Section 10(25) had been allowed in earlier and subsequent years. It relied on judicial precedents to seek condonation of delay, arguing that the delay was neither deliberate nor contumacious.
The revisional authority, after granting personal hearing and considering submissions, held that Section 264 requires revision to be filed within one year from the date of communication or knowledge of the order. It found the explanation for delay unsupported by evidence and not credible, particularly since pending demands were visible on the e-filing portal and regular communications were issued by the Department. Emphasis was placed on the petitioner being an institutional assessee expected to maintain reasonable diligence in monitoring its tax matters. The delay was held to be extraordinary and not supported by “sufficient cause” under Section 264(3).
The Telangana High Court, after examining the rival submissions and the principles laid down in N. Balakrishnan v. M. Krishnamurthy, held that the question was not whether the exemption was allowed in other years, but whether sufficient cause existed for condoning a delay of nearly seven years. It concluded that no such cause was shown and that the findings of the Principal Commissioner were neither arbitrary nor perverse. Accordingly, the writ petition was dismissed.
The Supreme Court, finding no reason to interfere with the High Court’s judgment, dismissed the special leave petition, thereby confirming that revision proceedings under Section 264 cannot be revived after an unexplained and inordinate delay, even where substantive exemption claims are asserted.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
1. Delay condoned.
2. We are not inclined to interfere with the impugned judgment and order of the High Court; hence, the special leave petition is dismissed.
3. Pending application(s), if any, shall stand disposed of.
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