The Supreme Court, in Merchant Navy Officers and Ladies Association (MNOLA) v. Union of India & Ors., has disposed of a writ petition concerning Income Tax consequences faced by Indian seafarers during the COVID-19 pandemic, while directing the authorities to sympathetically consider the representations submitted by the petitioner Association.
The matter was heard by a Bench comprising the Hon’ble Chief Justice, Hon’ble Mr. Justice Joymalya Bagchi and Hon’ble Mrs. Justice V. Mohana on 21 August 2026 in Writ Petition (Civil) No. 1059 of 2020.
Challenge to CBDT Circular No. 11 of 2020
The petitioner sought quashing of CBDT Circular No. 11 of 2020 dated 8 May 2020. It also sought a consequential direction for framing a “Compassionate Tax Policy” granting at least 60 days’ exemption to Indian seafarers who had remained in India for more than 182 days during a financial year because of the COVID-19 pandemic.
The grievance arose from the impact that an extended and involuntary stay in India during pandemic-related restrictions could have on the tax position of Indian seafarers.
Supreme Court’s Direction
The Supreme Court noted that the issues raised in the writ petition had already been placed before the authorities through representations submitted by the petitioner.
Without expressing any opinion on the merits of the claim, the Court disposed of the petition with a direction to the respondents to consider those representations sympathetically.
The Court specifically directed that the representations be considered particularly in light of the decisions referred to in its order, including Gaurav Baid v. Union of India, Arjun Panditrao Khotkar v. Kailash Kushanrao Gorantyal, the Gujarat Assembly Election Case, Union of India v. Azadi Bachao Andolan and Shri Bhagwati Steel Rolling Mills v. Commissioner of Central Excise.
The Court further observed that it would be appreciated if an appropriate decision were taken within four weeks.
Importantly, the Supreme Court did not quash CBDT Circular No. 11 of 2020 and did not itself grant the requested 60-day exemption. The substantive claim has been left for consideration by the competent authorities on the petitioner’s representations.
Significance of the Order
The order is significant for Indian seafarers whose stay in India was prolonged during the COVID-19 pandemic and who sought relief from the resulting Income Tax consequences. While no substantive tax exemption has been judicially granted by this order, the direction requires the authorities to reconsider the representations sympathetically and take an appropriate decision.
The case therefore remains relevant for tax professionals, maritime professionals and advisers dealing with questions arising from exceptional periods of involuntary stay in India and their impact under the Income Tax framework.
