2024 (5) TMI 350 - HC - Income Tax

Validity of order passed u/s 147 r.w.s.144B - availability of alternate statutory remedy - conditions for exercise of jurisdiction by HC - writ petition contending that the provisions of section 69C read with section 115BBE of the Act could not be invoked and the show-cause notice did not refer to these provisions - petitioner submits that the AO has failed to give sufficient time to the petitioner while issuing notice u/s 69C - HELD THAT - Considering that factual aspects are involved this Court would refrain from entering into a fishing enquiry while examining a case under writ jurisdiction. We also notice that the judgment cited by the learned counsel of Full Bench of the Hon ble Supreme Court of India in Calcutta Discount Co. Ltd. 1960 (11) TMI 8 - SUPREME COURT is with regard to the issue where the concerned Income Tax Officer acted without jurisdiction and in these circumstances Supreme Court held that the writ Court may entertain a plea challenging such assessments done without jurisdiction. The Hon ble Supreme Court in case of The State of Maharashtra and others versus Greatship (India) Limited 2022 (9) TMI 896 - SUPREME COURT as held High Court has seriously erred in entertaining the writ petition against the assessment order. The High Court ought to have relegated the writ petitioner assessee to avail the statutory remedy of appeal and thereafter to avail other remedies provided under the statute. Similarly in case of The State of Madhya Pradesh and another versus M/s Commercial Engineers and Body Building Company Limited 2022 (10) TMI 576 - SUPREME COURT the issue was regarding maintainability of writ petition in relation to tax matters where statutory remedy of appeal is available and it was held that the impugned judgment and order passed by the High Court entertaining the writ petition under Article 226 of the Constitution of India against the Assessment Order denying the benefit of Input rebate is unsustainable and the same deserves to be quashed and set aside. This Court refrains from entertaining the present writ petition. Consequently the present petition is hereby dismissed. It is made clear that the period for filing of appeal has expired however in the circumstances the appellate authority is directed to hear the appeal on merit if it is filed within a period of 15 days subject to making pre-deposits if required in law.

Summary

Issues involved:
The issues involved in the judgment are the jurisdiction of the High Court under Section 34 of the Income Tax Act, 1961, the sufficiency of time given by the Assessing Officer for issuing notices, and the availability of alternate statutory remedies in tax matters.

Issue 1: Jurisdiction under Section 34 of the Income Tax Act, 1961:
The petitioner argued that the High Court can investigate the conditions for exercising jurisdiction under Section 34 of the Income Tax Act, 1961, based on judgments by the Hon'ble Supreme Court. However, the respondents cited cases emphasizing the availability of alternate statutory remedies as a reason to refrain from exercising jurisdiction under constitutional provisions.

Details: The petitioner challenged the assessment order passed under Section 147 read with Section 144B of the Act of 1961. The Court refrained from entering into a fishing inquiry under writ jurisdiction, considering the factual aspects involved. The judgment cited by the petitioner's counsel highlighted instances where Income Tax Officers acted without jurisdiction, allowing the writ Court to entertain pleas challenging such assessments.

Issue 2: Sufficiency of Time for Issuing Notices:
The petitioner contended that the Assessing Officer failed to provide sufficient time while issuing notice under Section 69C of the Act of 1961. The notice was issued under Section 148, and the petitioner's reply was allegedly not considered before the impugned order was passed. Moreover, it was argued that the provisions of Section 69C read with Section 115BBE were not appropriately invoked in the show cause notice.

Details: The petitioner raised concerns about the timing and consideration of their response to the notice issued. The Court acknowledged the petitioner's arguments but emphasized the need to examine the records to address the issues effectively. It was noted that the petitioner's contentions could be adequately considered through a thorough examination of the case, given the factual complexities involved.

Issue 3: Availability of Alternate Statutory Remedies:
The judgments cited by the respondents emphasized the importance of availing alternate statutory remedies in tax matters. The Court highlighted that judicial prudence demands refraining from exercising jurisdiction under constitutional provisions when alternate remedies are available, as seen in various cases discussed.

Details: The Court reiterated that when alternate remedies exist, it is essential for the petitioner to follow the statutory procedures before seeking judicial intervention. The judgments referred to underscored the significance of exhausting statutory avenues before resorting to writ petitions. In light of recent pronouncements and legal principles, the Court dismissed the present writ petition, granting the petitioner the liberty to pursue available alternate remedies before the competent authority.

Separate Judgment:
No separate judgment was delivered by the judges in this case.