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TMI Blog2013 (12) TMI 845X X X X Extracts X X X X X X X X Extracts X X X X ..... 488 OF 2013, W.P (T) NO. 1491 OF 2013, W.P (T) NO. 1492 OF 2013, W.P (T) NO. 1497 OF 2013, W.P (T) NO. 1900 OF 2013, W.P (T) NO. 1877 OF 2013 - - - Dated:- 10-12-2013 - R. Banumathi, C.J. And Aparesh Kumar Singh,JJ. For the Appellant : M/s. B. Poddar, Senior Advocate, D. Poddar,P. Poddar, A. Sinha For the Respondents : M/s. D. Roshan, S.S.C(Revenue), R. Kumari ORDER R.Banumathi, CJ. These writ petitions have been filed challenging the show cause notices, F.No.CIT(A)/RAN/Notice/2012-13/374-75 dated 8/10.1.2013 and F. No. CIT (A) /RAN/Notice/2012-13 dated 24.1.2013 issued under section 251(1)(a) of the I.T Act, 1961, by which the Commissioner of Income Tax (Appeals) directed the petitioner-company to show cause as to why the provisions of section 251(1)(a) of the I.T Act should not be invoked for the Assessment Years 2002-03, 2003-04, 2004-05, 2005-06, 2006-07, 2007-08, 2008-09, 2009-10 and the income liable to tax should not be enhanced and why the books of accounts of the petitioner-company should not be rejected and also directed the petitioner-company to show the status of the petitioner as a company. 2. On behalf of the writ petitioner, it is contended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and cannot be relied upon as a basis to determine and compute the true and correct income of the assessee. In view of that the same are liable to be rejected and the correct income of appellant is required to be determined as per applicable provisions of law. 4. In W.P (T) No.1877/2013, Central Mine Planning Design Institute Ltd. (CMPDI), is a subsidiary of CCL and CCL is the holding company. CMPDI Ltd. was incorporated as a company in 1975 and in terms of Sections 2(17) and 26 of the Income Tax Act, 1961, CMPDI Ltd. has been assessed by the Income Tax authorities as a company. Like in the case of CCL, a show cause notice has been issued to CMPDI Ltd. raising doubts about its status as a company. Since the issue involved in W.P (T) No.1877/2013 is one and same, the writ petition is taken up along with other writ petitions. 5. Learned Senior Counsel, Mr.B.Poddar, appearing for the petitioner, inter alia, submitted that since the inception of the petitionercompany, Income Tax Department has rightly assessed the status of the petitioner as a Company in terms of sub-section (17) and (26) of Section 2 of the I.T Act and by issuing the show cause notice, CIT (Appeals) committe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Union of India Vs. Hindalco Industries), Hon ble Supreme Court held that in matters of taxation, it is inappropriate for the High Court to interfere in exercise of jurisdiction under Article 226 of the Constitution either at the stage of the show cause notice or at the stage of assessment where alternative remedy by way of filing a reply or appeal, as the case may be, is available. It was further held that these are the limitations imposed by the Courts themselves in exercise of their jurisdiction and they are not matters of jurisdictional factors. 8. It is well settled that the writ petition challenging the show cause notice is not to be entertained in taxation matters, but in exceptional cases, where the authority goes beyond the statutory power or acts in excess of its jurisdiction, in those facts and circumstances, the writ petition can be entertained. The case in hand is one such exceptional case, warranting entertainment of the writ petition for the reasons indicated infra. 9. The petitioner-company was incorporated in the year 1956 and enjoying the status of a Company under the Companies Act, 1956 and also under the Income Tax Act. The petitioner-company is maintaini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1956. According to the petitioners, CCL/CMPDI Ltd. are enjoying the status of the company over several decades and the CIT (Appeals) is not justified in raising doubt about the status of the petitioner-company and the respondents cannot contend that the show cause notice has been issued as only for verification exercise. 12. The tenor of the show cause notice does not appear to be a notice merely for verification of the status of the petitioner-company. The CIT (Appeals) issued impugned show cause notices raising doubts regarding the status of the petitioner as a Company . By careful reading of the impugned show cause notices, it is seen that the CIT (Appeals) has expressed the view that the petitioner-company, a public sector company, will not be a company either under the Companies Act or under the I.T Act, 1961, stating that the petitioner appears to be 'not a company' either under the provisions of the Companies Act or under the I.T Act, 1961. The relevant portion of the impugned show cause notice, expressing view that the petitioner is not a company, reads as under:- 5.Before adjudicating the correctness or otherwise of the claims and counter-claims of the Ld. A.O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any other case, may pass such orders in the appeal as it thinks fit. By reading of Section 251(1)(a), it is seen that the power under Section 251 could be exercised by the CIT (Appeals) only in respect of the appeals pending before it or appeals stand disposed. In the impugned show cause notices, the CIT (Appeals) seems to have reopened the assessment of all the years, as is seen from the proceedings, which is reproduced below:- 10. In these facts and circumstances, I am satisfied that prima facie a case for enhancement of income of the assessee is made out in all the Assessment years in which appeals are pending as well as in those years where either no appeal is pending or stands disposed. 15. It is seen that the CIT (Appeals) had not only stated to reopen the assessment in which the appeals are pending but also for the assessment in which either no appeal is pending or already stands disposed. In our considered view, the impugned show cause notices seeking to reopen the assessment in respect of all the years seems to be in excess of the power of the CIT (Appeals) under Section 251(1)(a). 16. Since the CIT (Appeals) has expressed doubts that the petitioner is not a compa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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