2023 (3) TMI 928 - HC - Income Tax

Best judgment u/s 144 - AO jurisdiction - whether assessing officer is not the jurisdictional officer vested with the authority to pass an order? - HELD THAT - The order of assessment involves questions of fact and we also find that there is no finding rendered on the issue of jurisdiction which has been raised by the appellant. The above grounds need to be dealt with. Having said that we are however not inclined to examine the above questions as they would require investigation into facts which is beyond the realm of jurisdiction under Article 226 of the Constitution of India. In this regard it may be relevant to refer to the judgment of Hon ble Supreme Court in the case of Authorized Officer State Bank of Travancore and Another vs Mathew K.C 2018 (2) TMI 25 - SUPREME COURT . It is open to the appellant to file an appeal within a period of 4 weeks from the date of receipt of a copy of this order.

Summary

Issues:
The issues involved in the judgment are the challenge to the order of assessment under Section 144 of the Income Tax Act, 1961 on the ground of jurisdiction, limitation under Section 153(1) of the Act, violation of principles of natural justice, and the finding on the issue of jurisdiction raised by the appellant.

Jurisdiction and Limitation:
The appellant challenged the order of assessment on the basis that the assessing officer lacked jurisdiction to pass an order of best judgment under Section 144 of the Act. Additionally, it was argued that the impugned orders of assessment were barred by limitation as per the proviso to Section 153(1) of the Act, which states that the limitation should be reckoned in terms of Section 153(1) i.e., 21 months from the end of the assessment year in which the income was first assessable under Section 153 of the Act.

Violation of Principles of Natural Justice:
The order of assessment was further contested on the grounds of violation of principles of natural justice. The appellant claimed that the assessing officer did not consider the replies dated 27.12.2019 and 28.12.2019, which were submitted by the appellant in response to the show cause notices. The appellant argued that the assessing officer did not apply his mind to the objections raised in the replies, thus violating the principles of natural justice.

Finding on Jurisdiction Issue:
The judgment noted that the order of assessment involved questions of fact, and there was no specific finding rendered on the issue of jurisdiction raised by the appellant. However, the court declined to examine these questions further as they required an investigation into facts beyond the scope of jurisdiction under Article 226 of the Constitution of India. The court referenced a Supreme Court judgment emphasizing the importance of exhausting statutory remedies before seeking relief under Article 226.

Conclusion:
The writ appeal challenging the order of assessment under Section 144 of the Income Tax Act, 1961 was disposed of with the observation that the questions of fact and jurisdiction raised by the appellant were not examined due to limitations of jurisdiction under Article 226. The appellant was given the option to file an appeal within four weeks, with the directive that any such appeal should be disposed of by the Appellate Authority within six weeks from filing. No costs were awarded, and any connected miscellaneous petition was closed accordingly.