DHAKESWAR1 COTTON MILLS LTD. vs COMMISSIONER OF INCOME TAX,WEST BENGAL

The Supreme Court held that the powers conferred under Article 136 of the Constitution are exceptional and should be exercised sparingly, particularly in cases of arbitrary adjudication. The Court emphasized that the Income-tax Officer's authority under Section 23(3) of the Indian Income-tax Act, 1922, does not permit assessments based solely on suspicion or guesswork without evidence. The assessment process must allow the assessee to present their case and rebut any information used against them, failing which it constitutes a violation of fundamental justice principles.