2017 (8) TMI 1679 - HC - Income Tax

Maintainability of petition - recognition as a charitable institution for granting exemption u/s 10(23C)(vi) denied - alternate remedy - HELD THAT - The order impugned in this appeal is an order passed under Section 10(23C) (vi) of the Income Tax Act 1961, dated 03.08.2015 passed by the Chief Commissioner of Income Tax, Allahabad. Section 253 (1)(f) which was inserted with effect from 01.06.2015 vide Finance Act 2015 provides for an appeal against the order passed by the Prescribed Authority under Section 10(23C) (vi) of the Act. In view of the above provisions, there is a clear statutory remedy of appeal available to the petitioner which has not been availed. The mere fact that the department may or may not have raised the above objection earlier would not obliterate the legal position as the right to file appeal available under the Act. Thus, irrespective of the fact that there was no objection earlier regarding alternate remedy as undisputedly the petitioner has a remedy of filing an appeal against the impugned order, we do not deem it proper to proceed further and to adjudicate the rights of the parties involving factual aspects in exercise of extraordinary jurisdiction. Accordingly, we dismiss the petition on the ground of alternate remedy with liberty to the petitioner to avail the remedy of appeal. It is expected that in case any application for condoning the delay on account of the fact that the petition was incorrectly filed and was pending in the High Court, the Appellate Authority would consider the delay condonation application sympathetically.

Summary

Issues:
1. Maintainability of the petition due to the availability of an alternate remedy of appeal under Section 253(1)(f) of the Income Tax Act 1961.

Analysis:
The judgment by the High Court of Allahabad, delivered by Hon'ble Pankaj Mithal and Hon'ble Umesh Chandra Tripathi, JJ., addressed the issue of the maintainability of a petition challenging an order passed under Section 10(23C)(vi) of the Income Tax Act 1961. The respondent's counsel raised a preliminary objection, contending that the impugned order was appealable under Section 253(1)(f) of the Act, inserted by the Finance Act 2015, and thus the petition should not be entertained without exhausting the remedy of appeal. The Court acknowledged the statutory remedy of appeal available to the petitioner, which had not been utilized. Despite the petitioner filing the petition without any objection raised earlier, the Court emphasized the importance of adhering to the statutory appeal process.

The Senior Counsel for the petitioner argued that the objection regarding the alternate remedy was not raised initially or in the counter affidavit. However, the Court reiterated that the existence of the right to file an appeal under the Act cannot be overlooked, regardless of when the objection was raised. The judgment emphasized that the availability of an alternate remedy through the appeal process precludes the Court from adjudicating on factual aspects using extraordinary jurisdiction. Consequently, the Court dismissed the petition on the grounds of the existence of an alternate remedy, granting the petitioner liberty to pursue the appeal process.

In conclusion, the High Court dismissed the petition, directing the petitioner to avail the remedy of appeal under Section 253(1)(f) of the Income Tax Act 1961. The Court instructed the Appellate Authority to consider any application for condoning the delay sympathetically if the petitioner seeks to rectify the filing error. The certified copy of the impugned order was to be returned to the petitioner, retaining a copy on record. The judgment emphasized the importance of adhering to the statutory appeal process and respecting the availability of alternate remedies provided by the law.