2023 (8) TMI 1193 - HC - Income Tax

Reopening of assessment - notice issued u/s 148A - Petitioner claims that though he prayed for more time to respond to the notice but the respondent proceeded on to pass order u/s 148A(d) - Whether at this stage of notice under Section 148, writ Court should venture into the merits of the controversy when AO is yet to frame assessment/ reassessment in discharge of statutory duty casted upon him under Section 147 of the Act ? - HELD THAT - As the consistent view is that where the proceedings have not even been concluded by the statutory authority, the writ Court should not interfere at such a pre-mature stage. Moreover it is not a case where from bare reading of notice it can be axiomatically held that the authority has clutched upon the jurisdiction not vested in it. The correctness of order under Section 148A(d) is being challenged on the factual premise contending that jurisdiction though vested has been wrongly exercised. By now it is well settled that there is vexed distinction between jurisdictional error and error of law/fact within jurisdiction. For rectification of errors statutory remedy has been provided. We find that there is no reason to warrant interference by this Court in exercise of the jurisdiction under Article 226/227 of the Constitution of India at this intermediate stage when the proceedings initiated are yet to be concluded by a statutory authority. Hence the writ petition stands dismissed.

Summary

Issues Involved:
Challenge to notice under Section 148A(b) of the Income Tax Act, 1961 and order passed under Section 148A(d) along with notice under Section 148.

Comprehensive Details of the Judgment:

The petitioner, an assessee under the Income Tax Act, challenged a notice issued under Section 148A(b) of the Act and subsequent orders. The petitioner sought more time to respond to the notice but the respondent proceeded to pass orders under Section 148A(d) and issue a notice under Section 148 for filing income tax return. The primary issue in the writ petition was whether the court should intervene at the notice stage before the assessing officer frames an assessment/reassessment under Section 147 of the Act. The court referred to past judgments emphasizing that the statutory machinery should be exhausted before seeking court intervention. The court noted that the petitioner did not challenge the notice on merits and no assessment order had been passed yet.

The court cited various cases to support the principle that interference by the court at a premature stage, before the conclusion of proceedings by the statutory authority, is unwarranted. It highlighted the distinction between jurisdictional error and errors of law/fact within jurisdiction, emphasizing that statutory remedies should be pursued for rectification of errors. The court concluded that there was no basis for court interference under Article 226/227 of the Constitution of India at this stage when the proceedings were ongoing and dismissed the writ petition, clarifying that the decision did not reflect an opinion on the case's merits.

In summary, the court upheld the principle that court intervention should be avoided at the preliminary stage of proceedings under the Income Tax Act before the statutory authority concludes its assessment/reassessment, emphasizing the importance of exhausting statutory remedies for rectification of errors.