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TMI Blog2021 (11) TMI 571X X X X Extracts X X X X X X X X Extracts X X X X ..... facts as germane for deciding the present petition are that the petitioner is a Company incorporated under the Companies Act. The petitioner had filed a statement of Income and Return for the Assessment Year 2014-2015 on 28.11.2014, in respect of which a scrutiny Assessment Order under Section 143(3) of the Income Tax Act, 1969 (hereinafter referred to the said Act) was framed on 30.12.2016. The petitioner thereafter received a Notice on 28.03.2019 under Section 148 of the said Act whereby the petitioner was called upon to show cause as to why the assessment for the Assessment Year 2014-2015 should not be re-opened. The petitioner vide the letter dated 26.04.2019 responded to the said notice and requested for furnishing the reasons. The respondent supplied the reasons for reopening vide the letter dated 30.05.2019. Being aggrieved by the said reasons, the petitioner had filed its objections vide the letter dated 31.07.2019. The respondent by a Speaking Order rejected the said objections and also simultaneously issued a Final Showcause Notice dated 04.10.2019 (Annexure 'J'). As per the case of the petitioner, it had requested for adjournment vide the letter dated 11.10.2019, however ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther submitted that the adjournment letter dated 11.10.2019 sent by the petitioner was received in the office of the respondent on 14.10.2019, on which date the impugned order of assessment was already passed, and even if the said order was treated as an ex-parte order, the petitioner is required to avail the statutory remedy available under the Act. Mr. Raval also submitted that the assessment of the concerned year was sought to be re-opened, as the petitioner had not truly and fully disclosed the material facts and even otherwise as per the explanation to the Section 147, mere production of documents would not necessarily amount to true and full disclosure of material facts. He also submitted that the Assessing Officer while passing the order under Section 143(3) on 30.12.2016, had not taken into consideration the material, i.e. Appendix 6 and Appendix 8 (Annexure I and II) of the Tax Audit Report form 3CD, from which it appeared that the TDS was not deducted, and when the petitioner had failed to deduct the TDS, he was liable for payment of interest as contemplated under the provisions contained in the Act. He also submitted that the requisite sanction under Section 151 was also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for reference could have been claimed if the appellants satisfied the Commissioner or the High Court that a question of law arose out of the order. But the procedure provided by the Act to invoke the jurisdiction of the High Court was bypassed, the appellants moved the High Court challenging the competence of the Provincial Legislature to extend the concept of sale, and invoked the extraordinary jurisdiction of the High Court under Article 226 and sought to reopen the decision of the Taxing Authorities on question of fact. The jurisdiction of the High Court under Article 226 of the Constitution is couched in wide terms and the exercise thereof is not subject to any restrictions except the territorial restrictions which are expressly provided in the Articles. But the exercise of the jurisdiction is discretionary: it is not exercised merely because it is lawful to do so. The very amplitude of the jurisdiction demands that it will ordinarily be exercised subject to certain sel f imposed limitations. Resort that jurisdiction is not intended as an alternative remedy for relief which may be obtained in a suit or other mode prescribed by statute. Ordinarily the Court will not entertain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y must be availed of. This rule was stated with great clarity by Willes, J. in Wolverhampton New Waterworks Co. v. Hawkesford [(1859) 6 CBNS 336, 356] in the following passage: There are three classes of cases in which a liability may be established founded upon statute. . . . But there is a third class, viz. where a liability not existing at common law is created by a statute which at the same time gives a special and particular remedy for enforcing it.... The remedy provided by the statute must be followed, and it is not competent to the party to pursue the course applicable to cases of the second class. The form given by the statute must be adopted and adhered to. The rule laid down in this passage was approved by the House of Lords in Neville v. London Express Newspapers Ltd. (1919 AC 368) and has been reaffirmed by the Privy Council in AttorneyGeneral of Trinidad and Tobago v. Gordon Grant & Co. Ltd. (1935 AC 532) and Secretary of State v. Mask & Co. (AIR 1940 PC 105). It has also been held to be equally applicable to enforcement of rights, and has been followed by this Court throughout. The High Court was therefore justified in dismissing the writ petitions in limine." (em ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1955 SC 425; Union of India vs. T.R. Varma, AIR 1957 SC 882; State of U.P. vs. Mohd. Nooh, AIR 1958 SC 86 and K.S. Venkataraman and Co. (P) Ltd. vs. State of Madras, AIR 1966 SC 1089 have held that though Article 226 confers a very wide powers in the matter of issuing writs on the High Court, the remedy of writ absolutely discretionary in character. If the High Court is satisfied that the aggrieved party can have an adequate or suitable relief elsewhere, it can refuse to exercise its jurisdiction. The Court, in extraordinary circumstances, may exercise the power if it comes to the conclusion that there has been a breach of principles of natural justice or procedure required for decision has not been adopted. (See: N.T. Veluswami Thevar vs. G. Raja Nainar, AIR 1959 SC 422; Municipal Council, Khurai vs. Kamal Kumar, (1965) 2 SCR 653; Siliguri Municipality vs. Amalendu Das, (1984) 2 SCC 436; S.T. Muthusami vs. K. Natarajan, (1988) 1 SCC 572; Rajasthan SRTC vs. Krishna Kant, (1995) 5 SCC 75; Kerala SEB vs. Kurien E. Kalathil, (2000) 6 SCC 293; A. Venkatasubbiah Naidu vs. S. Chellappan, (2000) 7 SCC 695; L.L. Sudhakar Reddy vs. State of A.P., (2001) 6 SCC 634; Shri Sant Sadguru Janard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nge of opinion, we may deal with the said issue also. In the said case the Supreme Court while dealilng with the changes made to Section 147 of the said Act w.e.f. 1st April, 1989 observed as under :- "6. On going through the changes, quoted above, made to Section 147 of the Act, we find that, prior to Direct Tax Laws (Amendment) Act, 1987, re-opening could be done under above two conditions and fulfillment of the said conditions alone conferred jurisdiction on the Assessing Officer to make a back assessment, but in section 147 of the Act [with effect from 1st April, 1989], they are given a go-by and only one condition has remained, viz., that where the Assessing Officer has reason to believe that income has escaped assessment, confers jurisdiction to reopen the assessment. Therefore, post-1st April, 1989, power to reopen is much wider. However, one needs to give a schematic interpretation to the words "reason to believe" failing which, we are afraid, Section 147 would give arbitrary powers to the Assessing Officer to reopen assessments on the basis of "mere change of opinion", which cannot be per se reason to reopen. We must also keep in mind the conceptual difference between po ..... X X X X Extracts X X X X X X X X Extracts X X X X
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