9911796707
TMI Blog1984 (12) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... ned counsel appearing for the petitioner, does not admit the correctness of the statement. However, these are only events leading to the impugned order. July 31, 1981, is the due date for filing the income-tax return for the assessment year 1981-82, under section 139(1) of the Income-tax Act. But no return was filed. Therefore, on January 2, 1982, a notice under section 139(2) of the Act was issued to the petitioner calling upon him to file a return of income within 30 days from the receipt of notice issued along with the summons. On January 10, 1982, the notice was served on the assessee's assistant. On January 20, 1982, a letter together with summons was issued to the assessee to produce the account books and documents by February 10, 1982, but the same was returned by the postal authorities with the endorsement "not available". Thereafter, on March 25, 1982, fresh notice under section 139(2) was issued to the assessee calling for a return of income. Along with the said notice, summons under section 131 was also issued to the assessee for personal appearance. The notice under section 139(2) was served by affixture. On April 16, 1982, a search under section 132 of the Act was co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etter was issued to the petitioner calling for separate applications for each assessment year to consider the request on merits. On February 4, 1984, the assessee was informed that he is permitted to inspect the seized documents. Thereafter, on February 4, 1984, again a letter was issued to the assessee calling upon him to file his return. On February 15, 1984, the petitioner was informed of the date on which permission to inspect the seized documents was given, but the petitioner did not avail of this opportunity. On February 24, 1984, the assessee informed the Department of the filing of an application before the Settlement Commission and requested the Department to keep the assessment pending. On Feburary 25, 1984, reply was sent to the assessee requiring him to file the return immediately as orders regarding the admissibility of the petition by the Settlement Commission had not been received. On the same date, a notice under section 142(1) was issued to the assessee calling upon him to produce the books of account and posting the case for hearing on March 5, 1984. On March 5, 1984, the assessee filed a "1 Nil " return with a covering letter without any statement, details, etc. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly an exclusion of limitation. Therefore, till that application is disposed of either way, the Department cannot proceed to assess stating that it was getting time-barred on March 31, 1984. Even then when the petitioner sought inspection of the records on February 15, 1984, the letter addressed by the Department reached him on February 18, 1984. The anxiety of the Department that the assessment was getting time-barred was obvious in view of the letter dated February 25, 1984, issued to him. That apart, a specific request was made by the petitioner to await the orders of the Settlement Commission on his application. If the Department's interpretation were to be accepted, what would happen is that the assessee would suffer an assessment and will have to pay as per the orders of assessment and ultimately seek refund of the excess after (receipt of) the orders of the Settlement Commission. That certainly is an improper interpretation of the section. The second aspect of this case which requires interference by this court under article 226 is that the order is clearly mala fide. It was the very same Income-tax Officer who passed the impugned assessment order and who conducted the raid d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Calcutta High Court and the Supreme Court. I may even now say that I am not concerned with those (proceedings or matters) for the purpose of deciding whether I should make the interim injunction absolute or not. Be that so. The first objection is that this court should not entertain this petition under article 226 of the Constitution of India. Even if it is a question of limitation, when there is adequate remedy available to the petitioner under the Act, which remedy has been availed of by the petitioner himself admittedly, it is not open to him to come before this court under article 226 of the Constitution. In support of this submission, reliance was placed on C. A. Abraham v. ITO [1961] 41 ITR 425 (SC), Shivram Podday v. ITO [1964] 51 ITR 823 (SC), Gita Devi Agarwal v. CIT (1970] 76 ITR 496 (SC), Champalal Binani v. CIT [1970] 76 ITR 692 (SC), Singam Chetty Ateendrooloo Chetty Charities v. Addl. CIT [1972] 86 ITR 262 (Mad), Isha Beevi v. TRO [1975] 101 ITR 449 (SC) and Titaghur Paper Mills Co. Ltd. v. State of Orissa [1983] 142 ITR 663 (SC). The further submission of the learned counsel for the Department is that this is a case to which section 153(1)(b) would apply. If th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... limitation, and (2) mala fides. Admittedly, against the impugned order of assessment, the petitioner has gone up in appeal to the Commissioner of Income-tax on October 20, 1984. The prayer for stay was dismissed on October 24, 1984. Thereafter a certificate under section 222 of the Act for the collection of tax was issued on October 26, 1984. The petitioner moved the Tribunal against the order of the Commissioner of Income-tax. If this be the position, as to whether the impugned order is one which is barred by limitation under section 153 is a matter which can easily be decided by the appellate authority. However, what Mr. V. P. Raman, learned counsel for the petitioner, would say is that that error is so apparent on the face of the record that the writ jurisdiction of this court is not barred. I am unable to accept this argument. Even if the error is apparent on the face of the record, the appellate authority is capable of granting the relief. The learned counsel for the Department is Tight in relying upon the various rulings to the effect that with regard to points of limitation, this court under article 226 of the Constitution should not interfere. As matter of fact in C. A. Ab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the assessing authorities are stayed, while the contrary contention is urged on behalf of the Income-tax Department. But on a very careful reading of the section extracted above, I am of the view that the jurisdiction of the assessing authority is not in any way fettered merely because there is an application under section 245C. Proceedings under section 245C are totally different from the assessment proceedings. This is very clear by an extract of the very section : " Application for settlement of cases.-(1) An assessee may, at any stage of a case relating to him, make an application in such form and in such manner and containing such particulars as may be prescribed to the Settlement Commission to have the case settled and any such application shall be disposed of in the manner hereinafter provided." What actually this section means is, in the event of an assessee wanting to defeat an order of assessment stating that it is time-barred, the Income-tax Department can say that the application of the assessee under section 245C was pending and, therefore, that period will have to be excluded for the purpose of computation. Therefore, ultimately it boils down to this. Sub-sec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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