2018 (1) TMI 1338 - HC - Income Tax

Validity of reopening of assessment - Held that - The facts on record do not show any exceptional circumstances where this petition should be entertained under Article 226 of the Constitution of India especially in view of the fact that the petitioner has a remedy of filing an appeal under the Act itself. It is the settled view of the courts that normally it is the statutory remedy, which should be availed of unless any exceptional circumstances are shown to exist where the statutory remedy is to be by-passed. In this case the petitioner avers that the reasons that were recorded were not issued to him. The record on the other-hand reflects that the petitioner was not co-operating with the department and had shown three different names at three different places. The reasons had been recorded they have been sent to him as stated in the counter affidavit filed by the department. Not inclined to interfere at this stage. It is open to the petitioner to take recourse to the statutory remedy available to him under the Act.

Summary

Issues:
1. Challenge to notice under Section 148 of the Income Tax Act, 1961
2. Challenge to order of assessment for reassessment of Income Tax for Assessment Year 2010-2011
3. Petitioner's request for relief under Article 226 of the Constitution of India
4. Allegation of reasons not being issued to the petitioner

Analysis:
1. The petitioner challenged a notice under Section 148 of the Income Tax Act, 1961, issued on 31.03.2017, along with an order of assessment dated 20.12.2017 for reassessment of Income Tax for the Assessment Year 2010-2011. The court noted that the petitioner had the statutory remedy of filing an appeal under the Act itself. The court emphasized that unless exceptional circumstances exist, the statutory remedy should be availed of. The petitioner claimed that the reasons for reassessment were not issued to him. However, the department contended that the reasons were sent to the petitioner, who was allegedly uncooperative and provided conflicting information.

2. The court highlighted that it is essential to demonstrate exceptional circumstances to bypass the statutory remedy. In this case, the court found that the petitioner failed to establish such circumstances warranting interference under Article 226 of the Constitution of India. Despite the petitioner's argument regarding the non-receipt of reasons for reassessment, the department maintained that the reasons were indeed communicated to the petitioner. The court considered the department's counter affidavit, which contradicted the petitioner's claim of non-cooperation and multiple name submissions.

3. Ultimately, the court concluded that based on the facts presented, there were no compelling reasons to intervene at that stage. The court dismissed the petition, directing the petitioner to pursue the available statutory remedy under the Act. The judgment emphasized the importance of adhering to the statutory procedures unless exceptional circumstances necessitate deviation. The court's decision underscored the principle that statutory remedies should be exhausted before seeking extraordinary relief under Article 226 of the Constitution of India.

4. In summary, the judgment of the High Court of Allahabad dismissed the petition challenging the notice and order of assessment under the Income Tax Act, 1961. The court rejected the petitioner's claim of not receiving the reasons for reassessment, citing the department's assertion of providing the reasons and the petitioner's lack of cooperation. The court upheld the significance of following statutory remedies and declined to entertain the petition under Article 226, advising the petitioner to utilize the available statutory recourse.