2021 (9) TMI 1333 - HC - Income Tax

Assessment u/s 144 - Denial of principles of natural justice - petitioner had already availed the statutory remedy of revision - HELD THAT - Undisputedly in the facts of the present case there is no violation of fundamental rights of the petitioner or there is a violation of principle of natural justice as the petitioner admits it was issued notices during the assessment proceedings and it had responded to the same. Whether an order under Section 144 of the Act could have been passed in the facts and circumstances claimed by the respective parties may involve factual issues. Even otherwise that objection may lead to an inference of irregular exercise of power but not inherent lack of jurisdiction. Such objections may be adequately addressed by the statutory authorities as well. On their face such objections do not always commend to the Court to offer interference when ever such objections are raised. In the present case the petitioner having already filed a revision prior to filing of the writ petition we are not inclined to lift to bar of alternate remedy. For that reason the other decision of the Supreme Court relied by the learned Senior Advocate in the case of Harbans Lal Sahania 2002 (12) TMI 564 - SUPREME COURT is also of no help to the petitioner. As to the last decision relied by learned Senior Advocate is of the Gurgaon Realtek Limited vs. National Faceless Assessment Centre Delhi 2021 (6) TMI 433 - DELHI HIGH COURT we find in that case a remedy of appeal had been availed by the assessee. However the Delhi High Court lifted the bar of alternate remedy taking note of the ground of lack of jurisdiction on account of limitation. In that case the Delhi High Court reached a conclusion that the assessment order could not have been passed under Section 143 (3A) and 143 (3B) on 15.04.2021 as that date fell after the date 31.03.2021. Here we are unable to reach that conclusion. The facts are otherwise. There is no bar of limitation being pressed into service. The other contention of petitioner that the preliminary objection has been raised for the first time today by means of the counter affidavit and that had not been pressed earlier cannot be accepted for the simple reason that the order sheet does not offer any assistance in that regard. The matter does not appear to have been heard on merits nor such hearing could be inferred from the perusal of the order sheet. At the same time the order sheet only indicates that on the first date itself the revenue sought and was granted time to file counter affidavit. Only contention advanced appears to have be as to the time sought and granted by the Court. However it does not appear that the preliminary objection was either raised or waived at that stage. Matter has remained on the fresh list and the Court cannot act unmindful on the statutory provisions and the conduct of the parties. Here the assessment order is dated 24.12.2019. The revision itself was filed on 17.12.2020 and the writ petition has been filed six months thereafter in June 2021. The alternate remedy had already been availed before the writ petition came to be filed. Therefore notwithstanding the fact that such preliminary objection had not been raised on the first hearing the court cannot ignore on the admitted fact that before approaching the Court the petitioner had already availed the statutory remedy of revision. To entertain such a writ petition would also affect the judicial policy of the Court which it consistently follows of not entertaining such writ petitions where alternative remedy has already been availed. Being discretionary in nature the Court remains as consistent as is humanly possible. No exceptional circumstance is made out as may commend to the Court to lift the bar of alternate remedy. Merely because the petitioner society is a body of lawyers regularly practising before this Court cannot make out a case of exception. As to the last submission of learned Senior Counsel that by virtue of proceedings under Section 270 A of the Act having been dropped the petitioner s revision became infructuous we may only observe that the submission is ill-conceived. The remedy of Revision is a statutory remedy. Once availed it may never be adversely affected by the conduct of the respondent authority unless it has a beneficial impact on the assessee.

Summary

Issues:
Challenge to assessment order under Section 144 of the Income Tax Act, 1961 for the assessment year 2017-18 by High Court Bar Association, Allahabad. Preliminary objection raised regarding the maintainability of the writ petition due to the availability of alternate remedy of Revision. Delay/laches in filing the writ petition. Refusal to interfere with assessment orders as per tax jurisprudence. Argument regarding lack of jurisdiction in passing the assessment order under Section 144. Claim of oblique motives behind passing the assessment order. Allegation of harassment to petitioner society. Refutation of preliminary objection by petitioner's counsel. Claim that revision remedy is not available due to dropped penalty proceedings under Section 270-A.

Analysis:
The High Court Bar Association, Allahabad filed a writ petition challenging the assessment order passed by the Income Tax Officer under Section 144 of the Income Tax Act, 1961 for the assessment year 2017-18. The respondent raised a preliminary objection that the petition should not be entertained as the petitioner had an alternate remedy of filing a revision under Section 264 of the Act. The respondent also highlighted the delay in filing the petition. The petitioner's counsel argued that the assessment order was passed without jurisdiction and for oblique motives, causing harassment to the petitioner society. The petitioner participated in the assessment proceedings, responding to all notices and providing necessary documentation to establish non-taxability under the Principle of Mutuality. The petitioner claimed that the revision remedy was not available due to dropped penalty proceedings under Section 270-A.

The Court emphasized the principle that the Writ Court should not readily interfere with assessment orders when statutory alternate remedies are available. The Court distinguished various cases cited by both parties to support their arguments. It was noted that the petitioner had already filed a revision before approaching the Court, indicating the availability of an alternate remedy. The Court refused to lift the bar of alternate remedy and dismissed the writ petition, considering the petitioner's delay in filing the petition and the availability of the revision remedy. The Court directed the Revising Authority to decide the revision expeditiously, without being influenced by the dropped penalty proceedings.

In conclusion, the Court dismissed the writ petition, emphasizing the importance of adhering to statutory remedies and maintaining consistency in judicial policy. The Court clarified that the dropped penalty proceedings did not render the revision infructuous, as the revision is a statutory remedy that must be decided on its own merits.