The Supreme Court on Friday dismissed yet another Special Leave Petition (SLP) filed by Income Tax Department on an issue the Court had already conclusively settled, terming the repeated litigation a “frivolous exercise” that burdens the judicial system.
A Bench comprising Justice BV Nagarathna and Justice R. Mahadevan was hearing an SLP challenging a Karnataka High Court ruling on the issue of tax deduction at source (TDS) liability on payments made to non-resident telecom operators. The legal question, however, had already been settled by the Supreme Court last year in the Vodafone Idea case, where it was held that such payments do not attract TDS.
Court Questions Department’s Motive
As soon as the matter was taken up, Justice Nagarathna questioned the very basis of the filing.
“Despite that order, why is this SLP filed?” she asked, noting that the Court had earlier dismissed an SLP arising from the same High Court judgment.
Appearing for the Department, counsel explained that although legal advice had been given against filing the petition, the Department insisted on pursuing it, citing the pendency of a review petition against the earlier judgment. “We advised them correctly,” counsel clarified.
The Bench was not persuaded.
Justice Nagarathna said the Court would explicitly record its displeasure in the order to “send a message” to the Department.
SC: FRIVOLOUS FILINGS CAUSE ‘DOCKET EXPLOSION’
In its written order, the Court expressed strong criticism of the Department’s litigation conduct:
“We fail to understand why the Department is continuously filing SLPs despite the order passed earlier by this Court following the decision in Engineering Analysis Centre for Excellence Pvt. Ltd. v. CIT. Once an SLP has been dismissed by this Court based on an earlier judgment, there ought not to be any more petitions filed by the Department. Filing such frivolous cases would only add to the pendency of this Court and lead to docket explosion and unnecessary wastage of judicial time.”
The Bench also noted that the Department’s justification of a pending review petition no longer survived, as the review itself had already been dismissed by a three-judge Bench.
‘MATTER FILED, DISMISSED — WHAT IS THIS? STATISTICS PURPOSE?’
After dictating the order, Justice Nagarathna voiced the Court’s frustration in clear terms:
“Matter filed, dismissed. What is this? Statistics purpose? If you are seeking the same thing, no SLP should be filed.”
She stressed that once the Supreme Court settles an issue and an SLP arising from the same judgment is dismissed, the Department must not continue filing fresh petitions in identical matters involving different assessees.
SC Flags Absence of Litigation Policy
Justice Nagarathna remarked that the pattern of indiscriminate filings shows a lack of coherent strategy:
“Once a matter is unsuccessful, the Department goes on filing cases in every assessee’s case. How can you persuade us to think otherwise?”
When counsel attempted to reference the Department’s monetary-limit policy for appeals, the Bench brushed aside the justification.
“No no, please convey this to the Department with your opinion,” Justice Nagarathna directed counsel.
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