SC dismisses ACIT’s appeal against reassessment due to delay & lack of merit

Case Name : ACIT Vs Teleperformance Global Service Private Ltd (Supreme Court of India) Appeal Number : Special Leave Petition (Civil)

Diary No. 59263/2024

Date of Judgement/Order : 10/01/2025

Related Assessment Year : Courts : Supreme Court of India

SC dismisses ACIT’s appeal against reassessment due to delay & lack of review in approval:

ACIT Vs Teleperformance Global Service Private Ltd (Supreme Court of India)

The Supreme Court of India has dismissed a Special Leave Petition filed by the Additional Commissioner of Income Tax (ACIT) against Teleperformance Global Service Private Ltd., citing an unexplained delay of 181 days in filing the petition and finding no merit in the case. This upholds the Bombay High Court’s decision, which had quashed a reassessment notice issued to Teleperformance under Section 148 of the Income Tax Act, 1961.

Teleperformance had challenged the initial notice, the subsequent order under Section 148A(d), and the reassessment notice, arguing that the sanction for reassessment under Section 151 was granted without proper application of mind. The Bombay High Court found discrepancies in the income figures mentioned in the approval documents, noting that while the Assessing Officer’s (AO) draft order under Section 148A(d) cited an escaped income of ₹97,06,911, the approval document referenced ₹63,16,784. The court held that the Additional/Joint Commissioner and the Principal Commissioner of Income Tax (PCIT) should have identified these inconsistencies during the approval process. Their failure to do so indicated a lack of due diligence, raising concerns about whether the sanction was granted after a thorough review.

Rejecting the revenue department’s justification of a “typographical error,” the High Court emphasized that such mistakes should have been caught in the approval process. Given these lapses, the court ruled that due process was not followed, leading to the quashing of the order under Section 148A(d) and the subsequent reassessment notice issued under Section 148.

Facts of Case:

1. Hon Bombay High Court had quashed a reassessment notice issued to Teleperformance under Section 148 of the Income Tax Act, 1961.

2. The court had observed discrepancies in the income figures mentioned in the approval documents. Specifically, the Assessing Officer’s draft order under Section 148A(d) of the Income Tax Act cited an escaped income of ₹97,06,911, while the approval document mentioned ₹63,16,784.

3. This inconsistency indicated a lack of due diligence by the approving authorities, leading the High Court to quash the reassessment proceedings.

Hon SC held as below:

1. There is a gross delay of 181 days in filing the Special Leave Petition which has not been satisfactorily explained by the petitioner.

2. Even otherwise, we see no reason to interfere with the impugned order passed by the High Court.

3. The Special Leave Petition is, accordingly, dismissed on the ground of delay as well as merits.

4. Pending applications, if any, also stand disposed of.