2018 (8) TMI 577 - HC - Income Tax

Income-Tax Settlement Commission order been passed under Section 245(D)(4) - Held that - Parliament has not provided for any Appeal from orders of the Commission. This with the hope that the order of the Commission would finally bring an end to a dispute between a party who has approached the Commission and the Revenue Department. It is in these circumstances that a party who seeks to approach the Court to challenge the orders of the Commission, must act expeditiously and ensure that the other party is not put to any prejudice because of the delay. Entertaining petition after almost over a period of one and half year would upset the settled positions and re-open matters without any explanation for the delay. No reason to exercise our extra-ordinary jurisdiction under Article 226 of the Constitution of India.

Summary

Issues:
Challenge to order of Income-Tax Settlement Commission under Article 226 - Delay in moving the Court for judicial review - Exercise of extra-ordinary jurisdiction under Article 226 - Justification for delay - Application of principles regarding delay in challenging administrative orders - Absence of statutory appeal provision from orders of Income-Tax Settlement Commission.

Analysis:
The High Court of Bombay heard a petition challenging an order dated 23rd April, 2015 passed by the Income-Tax Settlement Commission under Section 245(D)(4) of the Income-Tax Act, 1961. The petitioners received the impugned order on 20th May, 2015 and filed the challenge petition on 16th November, 2016, invoking Article 226 of the Constitution of India. The Court noted that the delay of over a year and a half in moving the Court for judicial review is a discretionary matter and not a right of the party. The Court emphasized that a party must provide adequate reasons for the delay, demonstrating no negligence or omission on their part. The reasons for delay must be examined in the context of the legislation under which the order is passed.

The petitioner argued that the delay in challenging the order was due to the transfer of responsible individuals and their engagement in time barring assessments. However, the Court found the explanation for the delay lacking in credibility. It held that the officers' busy schedule with assessments did not justify the failure to challenge the Commission's order promptly. The Court emphasized that the writ jurisdiction is reserved for parties who act diligently to rectify perceived injustices. The Court highlighted that the absence of annexing crucial documents and vague explanations for delay undermine the seriousness of the petitioner's challenge.

The Court rejected the reliance on Supreme Court decisions cited by the petitioner, emphasizing that the absence of a statutory appeal provision from orders of the Commission signifies the finality intended by Parliament in such matters. The Court stressed that parties seeking judicial review must act promptly to prevent prejudice to the other party. Entertaining a petition after a significant delay would disrupt settled positions and reopen matters without justification for the delay. Consequently, the Court declined to exercise its extra-ordinary jurisdiction under Article 226 of the Constitution of India and dismissed the petition without costs.