Chambal Fertilizers & Chemicals Ltd V. Union of India and Asstt. Comnr IT Udaipur

CW/1464/2009

AI Insights

The case involves M/s Chambal Fertilizers & Chemicals Ltd, which filed a writ petition against the Union of India and the Assistant Commissioner of IT, Udaipur, challenging a notice served under Sections 201(1) and 201(1A) of the Income Tax Act, 1961, for the financial years 2007-08 and 2008-09. The petitioner argued that the notice was issued without jurisdiction as their assessments were handled in Kota, not Udaipur. However, the court found that the Assistant Commissioner in Udaipur had concurrent jurisdiction due to a delegation of powers and dismissed the petition, allowing the petitioner to seek legal remedies if the notice led to an adverse decision.

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 803132 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 25-01-2011
• Assessment Year: misc
• Other Referred Cases: Sky-Cell Communications Ltd Vs. Dy. Commnr of IT & Ors (251 ITR 53)
• Laws Referred To: Income Tax Act, 1961, Article 226 of the Constitution
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: R B MATHUR; ACHINTYA KAUSHIK
• Assessee Lawyers: N M RANKA; NK JAIN
• Keywords: Defaulter; Extra-ordinary jurisdiction; Income tax assessment; Jurisdiction; Notice; Short Deduction
• Section: 201(1); 201(1A); 194-J

Judgement Text

" CW 1464/09 //1// In the High Court of Judicature for Rajasthan Jaipur Bench ** Civil Writ Petition No.1464/2009 M/s Chambal Fertilizers & Chemicals Ltd Kota Versus Union of India & Asstt. Comnr IT Udaipur. Date of Order ::: 25/01/2011 Hon'ble Mr. Justice Ajay Rastogi Mr. NM Ranka, Senior Counsel assisted by Mr. NK Jain, for petitioner Mr. RB Mathur & Mr. Achintya Kaushik for respondents Instant petition has been filed assailing notice dt.13/01/2009 served upon petitioner U/Ss 201(1) & 201(1A) of Income Tax Act, 1961 (“IT Act”) for Financial Year 2007-08 & 2008-09 (Up to Nov, 2008). It has not been controverted that immediately after income returns for relevant years being submitted by petitioner and before assessing authority could make assessments of IT returns, at this stage notice impugned dt.13/01/2009 was served upon petitioner. Counsel for petitioners submits that notice served upon petitioner is wholly without jurisdiction as its IT assessments are being made by assessing officer at Kota and present notice impugned has been served by Asstt. Commissioner of IT, Udaipur who does not hold any territorial jurisdiction; as such very noticed impugned served upon petitioner is without jurisdiction and deserves to be set CW 1464/09 //2// aside. Counsel further submits that the interpretation having been made by the authority while serving notice of S.194-J of IT Act is apparently erroneous and calling upon to submit any explanation after what has been observed by Asstt. Commissioner of IT remains empty formality and is not going to serve any purpose. In support, Counsel placed reliance upon decision of Madras High Court in Sky-Cell Communications Ltd Vs. Dy. Commnr of IT & Ors (251 ITR 53) and taking assistance whereof, Counsel submits that if interpretation being made by the authority while notice impugned being served is erroneous; this Court is competent to entertain writ petition U/Art.226 of the Constitution and more so when the issue relates to the question of law while invoking S.201(1) & 201(1A) of IT Act. It has not been disputed that no adverse decision pursuant to the notice impugned has been communicated by the authority with whom power is vested. Submissions made by Counsel is without substance for the reason that the petitioner might have submitted its IT returns at Kota, but the Asstt.Commissioner of IT Udaipur holds concurrent jurisdiction upon powers being delegated by the authority vide notification dt.20/11/2008 (Ann.R/5) and after IT returns CW 1464/09 //3// being submitted for relevant years, the authority holding concurrent jurisdiction has served upon petitioner U/s 201(1) & 201(1A) of IT calling upon to explain as to why petitioner assessee may not be treated as a defaulter and why short of deduction of IT for the period from April, 2007 to November, 2008 may not be recovered and from a bare perusal of notice served upon petitioner, what has been observed is its prima facie view which competent authority has disclosed in the notice impugned; but after the reply being submitted by petitioner raising written objections, the authority is supposed to examine and take its independent decision in accordance with law and if at all the final decision/outcome pursuant to the notice impugned causes adverse effect, that will always be opened for the petitioner to avail of remedy provided under law and expressing any opinion by this Court regarding merits or interpretation of S.194-J, as submitted by Counsel for petitioner, will certainly cause prejudice to either of parties to whom the authority is still supposed to hear before whom the matter is subjudice and at this stage, this Court is not inclined to exercise its extra ordinary jurisdiction U/Art.226 of the Constitution. As regards judgments cited by Counsel, it has no application to the facts CW 1464/09 //4// of instant case (supra). Consequently, writ petition fails and is hereby dismissed. However, if any adverse decision pursuant to the notice impugned is communicated, petitioner will be at liberty to avail of the remedy under law. No costs. (Ajay Rastogi), J. K.Khatri/p4/ 1464CW2009Jan25-ITDsRmdy.doc "