M/S SOUTHERN ISPAT AND ENERGY LIMITED V. UNION OF INDIA

WA/248/2022

AI Insights

The case involves M/s Southern Ispat and Energy Limited, represented by its director Smt. Anita Bajoria, appealing against an order of the learned Single Judge which upheld the proceedings initiated under Section 148 of the Income Tax Act, 1961. The appellant contested the validity of the sanction order under Section 151, claiming it lacked authenticity due to an incorrect DIN. The respondents countered that the DIN was correctly mentioned and that digital signatures were not required for internal communications. The learned Single Judge found no merit in the appellant's submissions and directed them to seek redress through the alternative remedy provided under Section 246(A) of the Act. The appeal to the High Court did not succeed in overturning this decision, and the court emphasized the availability of an alternative remedy without delving into the merits of the findings under Section 151.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 685988 (HC-CHHATTISGARH)
• Appeal Type: Others
• Pronouncement Date: 08-07-2022
• Assessment Year: misc
• Other Referred Cases: GKN Drivesharts (India) Ltd. v. Income Tax Officer & Others
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: RAMAKANT MISHRA; AMIT CHAUDHARI; NAUSHINA ALI
• Assessee Lawyers: APURV GOYAL
• Keywords: Digital Signature; Document identification number; Income Tax; Sanction Order; Writ Appeal
• Section: 148; 151; 246 A

Judgement Text

"1 NAFR HIGH COURT OF CHHATTISGARH, BILASPUR Writ Appeal No. 248 of 2022 M/s Southern Ispat and Energy Limited, Through Its Director Smt. Anita Bajoria, aged about 49 years, having its registered office at 14/448(2) KSN ILLAM, Ground Floor, Near SBI Kunnathurmedu (PO), Palakkad, Kerala – 678013. ---- Appellant Versus 1. Union of India Through its Secretary, Ministry of Finance, (Department of Revenue) No. 137, North Block, New Delhi-110001. 2. National Faceless Assessment Centre, Delhi Through Additional/Joint/ Deputy/Assistant Commissioner of Income Tax/Income Tax Officer, Income Tax Department, North Block, New Delhi-110001. 3. National e-Assessment Centre, Delhi Through Additional/Joint/Deputy/Assistant Commissioner of Income Tax/Income Tax Officer, Income Tax Department, North Block, New Delhi-110001. 4. Principal Commissioner of Income Tax-2 Raipur, Office of Commissioner of Income Tax, New C.R. Building, Civil Lines, Raipur, Chhattisgarh. 5. Joint Commissioner of Income Tax, Range 4, Raipur, New C.R. Building, Civil Lines, Raipur, Chhattisgarh. 6. Income Tax Officer, Ward 4(1), Raipur, Office of Income Tax Officer, Raipur, Civil Lines, Raipur, Chhattisgarh. ---- Respondents (Cause-title taken from Case Information System) For Appellant : Mr. Apurv Goyal, Advocate. For Respondent No. 1 : Mr. Ramakant Mishra, Assistant Solicitor General. For Respondents No. 2 to 6 : Mr. Amit Chaudhari, Advocate along with Ms. Naushina Afrin Ali, Advocate. 2 Hon'ble Shri Arup Kumar Goswami, Chief Justice Hon'ble Shri Justice Deepak Kumar Tiwari, Judge Judgment on Board Per Arup Kumar Goswami, Chief Justice 08.07.2022 Heard Mr. Apurv Goyal, learned counsel for the appellant. Also heard Mr. Ramakant Mishra, learned Assistant Solicitor General, appearing for respondent No. 1 and Mr. Amit Chaudhari along with Ms. Naushina Afrin Ali, learned counsel, appearing for respondents No. 2 to 6. 2. This appeal is presented against an order dated 17.03.2022 passed by the learned Single Judge in Writ Petition (T) No. 169 of 2021. 3. Perusal of the order of the learned Single Judge would go to show that a contention was advanced by the petitioner that sanction under Section 151 of the Income Tax Act, 1961, (for short, ‘Act of 1961) had not been accorded by the competent authority and that on making enquiries through online, it became evident that the Document Identification Number (DIN) mentioned in sanction order is not correct, and therefore, there is no authenticity of the sanctioning order. If there is no sanction order, the entire proceeding has to be construed to be illegal. 4. The submissions were countered by Mr. Amit Chaudhari contending that DIN number is very much available in the sanctioning order and digital signature is not required in an internal communication. 5. The learned Single Judge at paragraphs 6 and 7 observed as 3 follows: “6. Challenge in this Writ Petition is primarily with respect to initiation of proceeding under Section 148 is raised only on the ground of non-issuance of sanction order under Section 151 of the IT Act by competent authority. Perusal of sanction granted by competent authority at Page-35 would reflect that it bears DIN and document number. This document specifically bears name and designation of authority according sanction/approval under Section 151 of the IT Act. Hence, in view of submission of learned counsel for the respective parties and considering documents placed on record, wherein DIN is specifically mentioned, I do not find any merit in submission of learned counsel for the petitioner. 7. Pleading in reply, particularly in paragraph-4, respondents have very categorically pleaded that for obtaining approval under Section 151 of the IT Act, case record was also forwarded to respondent-4. Submission of learned counsel for the petitioner that sanction has been accorded in a perfunctory manner is also not sustainable. Undisputedly, final assessment order has already been passed on 23.09.2021.” 6. While recording as aforesaid, the learned Single Judge, at paragraph 10, observed that writ petition can be entertained in exceptional circumstances and the case presented by the petitioner was 4 not a case of that kind which required invocation of power under Article 226 of the Constitution of India and holding thus, relegated the petitioner to avail alternative remedy available under Section 246(A) of the Act of 1961. 7. Mr. Goyal submits that the reasons for initiating proceeding under Section 148 of the Act of 1961 was not furnished within a reasonable period of time. In support of his contention, he relies on a decision of Hon’ble Supreme Court in GKN Drivesharts (India) Ltd. v. Income Tax Officer & Others, reported in (2003) 1 SCC 72. He further submits that in the instant case, reasons furnished do not contain the signature of the issuing authority, date and time, and therefore, no reliance can be placed on the same. It is further submitted by Mr. Goyal that the DIN number showing in the sanction order being not a computer generated DIN number, the same is not in accordance with the Central Board of Direct Taxes (CBDT) Circular No. 19 of 2019 dated 14.08.2019. 8. Mr. Chaudhari submits that the arguments advanced by Mr. Goyal have no merit and at any rate, the same can be urged before the appellate authority. He submits that there is no illegality in the order of the learned Single Judge relegating the petitioner to avail alternative remedy available under Section 246(A) of the Act of 1961. 9. We have considered the submissions of the learned counsel for the parties and perused the materials on record. 10. We concur with the observation of the learned Single Judge that present is not a case warranting exercise of powers under Article 226 of the Constitution of India, having regard to the fact that the petitioner has 5 adequate efficacious alternative remedy. We are, however, of the opinion that if the learned Single Judge wanted the petitioner to avail alternative remedy, findings as recorded in paragraphs 6 and 7 ought not to have been recorded. 11. We are not inclined to examine in the present proceeding whether the findings recorded by the learned Single Judge is correct or not, as we have opined that the petitioner may avail alternative remedy. 12. In order not to cause any prejudice to the petitioner, we make it clear that the findings recorded by the learned Single Judge will not come in the way of the petitioner urging the very same points as well as other points before the appellate authority and the appellate authority, without being influenced by any such findings recorded by the learned Single Judge, in the event of filing of any appeal, shall decide the same in accordance with law. 13. The appeal may be presented within a period of 45 days from today and in the event of filing of appeal within this period, without going into the aspect of limitation period, appeal shall be decided on merits. 14. The writ appeal stands disposed of. No costs. Sd/- Sd/- (Arup Kumar Goswami) (Deepak Kumar Tiwari) Chief Justice Judge Brijmohan "