Authority: Supreme Court of India

Order Date: 05 August 2026

Case Overview

  • Petitioners: Deputy Commissioner of Income Tax, CPC & Ors.; Respondent: M/s Om Siddhakala Associates.
  • The appeal arose from a High Court judgment (WP No. 14178/2023 dated 28‑03‑2024) that remanded the matter for fresh consideration.
  • The Department argued that the tax demand was based on returns filed on self‑assessment, processed by the Centralised Processing Centre, Bengaluru, with notices under Section 143(1) and Section 156 issued.
  • The assessee had invoked Section 264 of the Income Tax Act to seek revision, which the Principal Commissioner rejected on grounds of unexplained delay and that tolerance limits under Section 43CA were prospective.
  • The High Court’s remand was contested on the basis that the assessee had not claimed any tolerance limit in the original return and had failed to revise the return within the statutory period; therefore, a revision under Section 264 was impermissible.
  • Counsel for the respondent contended that a re‑assessment had been made after the remand and that the order should be prospective or retrospective; the Court found this argument unconvincing.
  • The Court noted that the appeal does not address whether the tolerance limit would be retrospective or prospective, focusing solely on the permissibility of the remand.
  • Counsel for the petitioners included Mr. Venkataraman Chandrashekhara Bharathi, Mr. Sudarshan Lamba, Mr. Udai Khanna, Mr. Padmesh Mishra, and Mr. Mukesh Kumar Verma. Counsel for the respondent included Mr. Rajat Mittal, Mr. Sanket S Bora, Ms. Vidhi K Punmiya, and Mr. Subham Kumar.

Final Outcome

  • Delay in filing the Special Leave Petition is condoned.
  • Leave is granted to the petitioners.
  • The appeal is allowed to the extent that the High Court’s remand order is set aside.
  • Consequently, the re‑assessment order issued after the remand has no effect; the respondent must pay tax based on the original return on which the intimation and demand were issued.
  • Any pending applications, if any, are disposed of.

Topics: Tax Litigation, Supreme Court Order