9911796707
TMI Blog1972 (3) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant to show cause why a penalty should not be imposed upon him for not paying the tax assessed. On January 11, 1957, another notice under section 154/155 of the 1961 Act, was issued by the respondent, Income-tax Officer, for rectification of the purported assessment made under section 144 of that Act. On January 21, 1967, two applications were presented by the appellant to the Income-tax Officer. In the first application, the petitioner contended that the assessment was ultra vires as it was made under the 1961 Act and not under the 1922 Act, and, therefore, no question of penalty could arise. In the second petition, objection was taken by the appellant to the competency of the notice for rectification of the order of assessment already made. On February 16, 1967, a notice of demand and the corresponding challan and assessment order under section 144 of the 1961 Act relating to the assessment year 1961-62 were served on the assessee and on the same date the assessee made an application to the respondent, Income-tax Officer, requesting him to cancel the assessment and make a fresh assessment as he was not given reasonable opportunity to comply with the notice dated March 17, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of the repealed Act of 1922. But the learned judge says that unfortunately the fact that under the provisions of section 297(2)(a) the assessment should have been made under the provisions of the old Act was not brought to the attention of either the respondent, Income-tax Officer, or the respondent, Appellate Assistant Commissioner. There, of course, the learned judge was wrong. The attention of the Income-tax Officer in fact was drawn to the appellant's letter dated January 21, 1967, where it is stated: " It now appears to me from your notice under sections 154/155 of the Act of 1961 that the assessment order in question was passed under section 144 of the new Act. As the return was filed under the old Act and the assessment in question should have been made under the old Act and as such the assessment under section 144 is ab initio void." To the same effect it was repeated by the appellant in his letter dated January 21, 1967. Therefore, it is not quite correct to say that the Income-tax Officer's attention was not brought to the fact that the new Act not being applicable, the old Act is applicable. But the question did not rest there. The appellant took no point ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion whether the Income-tax Officer had any power at all to make an order of that nature. If the power is otherwise established, the fact that the source of the power has been incorrectly described would not make the order invalid. The provisions of section 23(3) of the 1922 Act are in pari materia with the provisions of section 143(3) of the 1961 Act and deal with the same subject-matter, that is, assessment. There is a slight difference in the language but the purport of the provisions in both the Acts is the same. Therefore, an order of the Income-tax Officer passed under section 143(3) of the Act of 1961 could be legitimately held to have been passed in exercise of the powers vested in the Income-tax Officer under section 23(3) of the 1922 Act. That was the decision of the Punjab and Haryana High Court in Commissioner of Income-tax v. Hargopal Bhalla Sons. In L. Hazari Mat Kuthiala v. Income-tax Officer, Special Circle, Ambala Cantt., the Supreme Court tended to give the same decision. There it was held that the Commissioner of Income-tax, purporting to act under section 5(5) and (7A) of the Indian Income-tax Act, made an order on November 4, 1953, that the assessment of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merits. Then the appellant chose the remedy and followed that path by way of an appeal to the Appellate Assistant Commissioner. There he does not argue the point at all and allowed the Appellate Assistant Commissioner to come to a decision on the merits and in fact he reduced the assessment. Now the appellant thinks of a change of course. He could have appealed to the Appellate Tribunal and got his relief if his point was sound and corrections made in the order of assessment. He did not do so. On the contrary he turned round and sought a writ under article 226 of the Constitution of India. As the appellant has already resorted to an alternative, and equally efficacious, legal remedy, it should be required to pursue that remedy and should not be allowed to invoke the special jurisdiction of the High Court under article 226 of the Constitution. Specially it is so here where the matter on merits hardly deserves interference under the writ in the discretionary jurisdiction. The appellant's fear of the penalty and prosecution being different under the new Act being made applicable to him is premature and if it comes then the appellant's remedy would be open under article 226 of the Con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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