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TMI Blog2022 (5) TMI 1015X X X X Extracts X X X X X X X X Extracts X X X X ..... tances of this case. While on this issue we take note of the decision of the High Court of Judicature of Madras in the case of Director General of Income Tax (INV.) and Others vs. T. S. Kumaraswamy, Proprietor, Christy Friedgram Industry and Others [ 2019 (5) TMI 194 - MADRAS HIGH COURT] . The said appeal filed by the Income Tax Department was directed against certain adverse remarks made against the officer of the Income Tax Department and their senior standing counsel. The first objection which was raised was by the writ petitioner/assessee that he should be heard in the matter. This was rejected by the following decisions of the Hon ble Supreme Court as the writ petitioner/assessee was not concerned with the subject in issue and, therefore, no notice was required to be issued to the assessee. The next aspect of the matter is whether the observations/remarks made by the learned Single Judge against the officer of the Department and the senior standing Counsel are required to be expunged or not. The court noted the decision in Manish Dixit v. State of Rajasthan [ 2000 (10) TMI 970 - SUPREME COURT] wherein the Supreme Court pointed out and cautioned that before any ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 14 of the Code and also extracted the relevant portion of the order passed by the NCLT. In support of such contention, reliance was placed on the decision of the Hon ble Supreme Court in Alchemist Asset Reconstruction Company vs. Hotel Gaudavan (P) Ltd. Ors. reported in (2017) 88 taxmann.com 202 (SC) and the decision in the case of Mr. Rajendra K. Bhutta vs. Maharashtra Housing and Area Development Authority Anr. (Civil Appeal No.12248 of 2018 dated 19.02.2020) and the other decisions of the Income Tax Appellate Tribunal, Delhi Bench and also the Securities Appellate Tribunal. Further, the assessee contended that in terms of Section 238 of the Code, the provisions of the Code shall override the provisions of the Income Tax Act and reference was also made to Section 178 of the Income Tax Act, which also provides that the Section shall override all other laws for the time being in force except the Insolvency and Bankruptcy Code (IBC). In support of such contention, reliance was placed on the decision of the Hon ble Supreme Court in PCIT vs. Monnet Ispat and Energy Ltd. reported in (2018) SCC Online SC 984. Therefore, the assessee requested the assessing officer to k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oceedings which were pending and the effect of Section 14 of the Code have not been dealt with though that was the core issue which was canvassed in the writ petition. The learned writ Court was of the opinion that the case of the assessee cannot be a case of violation of principles of the natural justice as the assessee had participated in the assessment proceedings and they wanted to challenge the assessment order before the writ Court. In our considered view there is a slight mistake on facts because the assessee had impugned the assessment order dated 30th March, 2022 by way of a supplementary affidavit since this assessment order was passed during the pendency of the writ petition. In the writ petition, what was impugned was the show cause notice dated 23rd March, 2022. As pointed out earlier, in response to the show cause notice, the assessee had specifically raised the legal issue with regard to the effect of the provisions of the IBC and without prejudice to the said submission, the assessee also submitted their reply on the merits on the proposed assessment which the assessing officer proposed to pass. More importantly, the assessing officer also pointed out that in the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be restored to the file of the assessing officer and the matter shall be kept in abeyance till the completion of the insolvency resolution proceedings. 8. In the penultimate portion of the order, the learned writ Court while dismissing the writ petition has imposed cost of Rs.10,000/- on Mr. Somak Basu, learned Advocate. The learned writ Court was of the opinion that the costs need to be imposed because of his rude behaviour in the Court and addressing the Chair in a disrespectful manner. In the appeal, several grounds have been raised on this very particular issue. Mr. Basu, learned Advocate has appeared before us and submitted that he had not uttered any disrespectful expression to the Court and his endeavour was to persuade the Court by beseeching the Court to consider Sections 14 and 238 of the IBC and the relevant judgments of the Hon'ble Court. Furthermore, Mr. Basu would submit that it was his endeavour to bring to the notice of the Hon ble Court that there has been gross violation of principles of natural justice and the assessing officer, during the pendency of the writ petition, without acceding to the request for deferment of the proceedings, had completed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missing in the offending comments. 17. The tenor of the remarks recorded against the appellant will not only demean him amongst his professional colleagues but may also adversely impact his professional career. If the comments remain unexpunged in the Court judgments, it will be a cross that the appellant will have to bear, all his life. To allow to suffer thus, would in our view be prejudicial and unjust. 9. As pointed out by the Hon ble Supreme Court making strong observations against the counsel appearing for a party without opportunity of being heard, would negate the principles of audi alteram partem. Further, the Hon ble Supreme Court had pointed out that there should be requisite degree of restraint and sobriety on the part of the Court. Further, the Hon ble Supreme Court has held that if the comments remain unexpunged in the Court s judgment, it will be a cross that the appellant will have to bear all his life and to allow him to suffer, would be prejudicial and unjust. As pointed out by us, the learned Single Bench while deciding the writ petition had not adverted to the grounds of challenge made by the appellant questioning the show cause notice and proceeded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consider:- (a) whether the party whose conduct is in question is before the court or has an opportunity of explaining or defending himself; (b) whether there is evidence on record bearing on that conduct justifying the remarks; and (c) whether it is necessary for the decision of the case, as an integral part thereof, to animadvert on that conduct. 16. It was further pointed out that it had also been recognized that judicial pronouncements must be judicial in nature and should not normally depart from sobriety, moderation and reserve. 17. In the decision in the case of Niranjan Patnaik v. Sashibhushan Kar [reported in (1986) 2 SCC 569], after referring to the decision in the case of Mohammed Naim, the Hon'ble Supreme Court pointed out that it is settled law that harsh and disparaging remarks are not to be made against persons and authorities, whose misconduct comes into consideration before courts of law unless it is really necessary for the decision of the case as an integral part thereof to animadvert on that conduct. Accordingly, the Hon'ble Supreme Court held that the adverse remarks against the appellant therein were neither justified nor cal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat it cannot be gainsaid that the nature of remarks the learned Judge made, cast a serious aspersion on the appellants affecting their character or reputation and may ultimately affect their career also. The Hon'ble Supreme Court ultimately held that the Court should have used a temperate language and moderate expressions while criticising the appellants therein and shown judicious restraint, allowed the appeal and quashed the disparaging remarks made against the appellants therein. 22. In the decision in the case of State of Karnataka v. Registrar General, High Court of Karnataka [reported in (2000) 7 SCC 333], the challenge was to an order passed by the Division Bench of the High Court of Karnataka on the ground that it went outside the scope of the lis before it and made certain observations, which are not in tune with the perceptions of judicial exercise. The Hon'ble Supreme Court, at the very outset, pointed out that for disposal of the said appeal, there was no necessity to issue notice to the sole respondent therein namely the Registrar General of the High Court of Karnataka, as he would have nothing to say about the impugned directions and therefore disposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in (2005) 6 SCC 767], the Hon'ble Supreme Court, in the opening paragraph of the judgment, pointed out that the appeal reminded them of a golden advice given by the Supreme Court before more than four decades in the decision in the case of Mohammed Naim and proceeded to consider the question as to whether the remarks could be sustained. The Hon'ble Supreme Court ultimately held that the remarks were uncalled for and unwarranted and were accordingly quashed. 29. In the decision in the case of Public Concern for Governance Trust, where the appeal was filed by the State to expunge the remarks against the then Chief Minister, the appeal was held to be maintainable and the serious aspersions cast on the then Chief Minister affecting his reputation having been made without giving an opportunity were quashed. 30. In the decision in the case of Parkash Singh Teji v. Northern India Goods Transport Company Private Limited [reported in (2009) 12 SCC 577], the Hon'ble Supreme Court, while pointing out about the judicial restraint and discipline, referred to the decision in the case of K , a Judicial Officer, In re, [reported in (2001) 3 SCC 54] wherein it was held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iminal Procedure Code to expunge the remarks made against the advocate, who had filed a memo before the Court seeking for an adjournment on the ground of illness. This memo was rejected by the Court and certain remarks were made against the advocate. The remarks, having been made without notice or opportunity to the concerned advocate, were held to be bad, apart from holding that the remarks were unjustified and uncalled for and therefore, liable to be expunged. 37. In the decision a learned Single Judge of this Court in the case of T. Vetriselvan v. Tamil Nadu Mercantile Bank Limited [reported in 2002 (1) CTC 513], one of the questions, which fell for consideration is as to the what was the effect of an opinion given by a counsel to a party. It was held that the opinion given by a counsel was mainly based upon the records produced by his client and that the plaintiff had no right whatsoever to question the same or find fault with the opinion. 38. In the decision in the case of K. Ponnammal v. A. Loganathan [reported in 2010 (2) CTC 63], a learned Single Judge of this Court referred to Section 126 of the Indian Evidence Act and held that this protective umbrella also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s laid down by the Hon'ble Supreme Court in the decision in the case of Mohammed Naim had been complied with. One of those three tests is as to whether the party, whose conduct is in question is before the court or has an opportunity of explaining or defending himself. In the instant case, neither the officer of the Department nor its Senior Standing Counsel had an opportunity of explaining or defending themselves. Therefore, the first test laid down in the decision in the case of Mohammed Naim has not been fulfilled in the instant case . 13. The above decision would render full support to our conclusion that the adverse observation made against the learned Advocate for the appellant/assessee and the imposition of cost has to be expunged/set aside. 14. In the result, the appeal is allowed. The assessment order dated 30th March, 2022 is set aside and the matter is restored to the file of the assessing officer and the matter shall be kept in abeyance till the completion of the insolvency resolution proceedings. Soon after the proceedings are completed, the assessee shall inform, in writing, to the assessing officer in that regard. In the light of the observations made by u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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