Sri Chandra Sekar Reddy Bokkalapally V. National Faceless Assessment Centre, Income Tax Department, Ministry of Finance

WP/26493/2021

AI Insights

The case involves Sri Chandra Sekar Reddy Bokkalapally, the petitioner, challenging an assessment order issued by the National Faceless Assessment Centre, Income Tax Department, for the assessment year 2017-18. The petitioner argued that the assessment was made without adequate opportunity for response, citing a violation of natural justice. The respondent contended that the petitioner was given sufficient notice and opportunity to respond, which he did, albeit inadequately due to the limited time granted. The court considered the arguments and decided that the petitioner should first exhaust the available statutory remedy of appeal before approaching the High Court under Article 226 of the Constitution.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 805780 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 27-10-2021
• Assessment Year: misc
• Other Referred Cases: THE ASSISTANT COMMISSIONER OF STATE TAX AND OTHERS v. M/s COMMERCIAL STEEL LIMITED
• Laws Referred To: Article 226 of the Constitution of India, Section 151 CPC, Section 147, 144, 144B of the Income Tax Act, 1961, Section 246A of the Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: J V PRASAD
• Assessee Lawyers: A V RAGHURAM
• Keywords: Assessment Order; Income Tax; Natural Justice; Violation of Principles; Writ of Mandamus
• Section: 147; 144; 246A; 151; 144B; 226

Judgement Text

"HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY, THE TWENTY SEVENTH DAY OF OCTOBER TWO THOUSAND AND TWENTY ONE PRESENT THE HONOURABLE SRIJUSTICE UJJAL BHUYAN AND THE HONOURABLE DR. JUSTICE CHILLAKUR SUMALATHA WRIT PETITION NO: 26493 OF 2021 Between: Sri Chandra Sekar Reddy Bokkalapally, 7-1-48, New Prem Nagar, Mahabubnagar Town, Mahabubnagar District - 509001 , T.S. .,.PETITIONER AND National Faceless Assessment Centre, lncome Tax Department, Ministry of Finance, Room No.401 ,2nd Floor, E-Ramp, J.N. Stadium, Delhi- 110003. ...RESPONDENT Petition under Article 226 ol the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to pass an order or direction, especially one in the nature of WRIT OF MANDAMUS holding that the impugned order dated 15.09.2021 of Respondent for the assessment year 2017-18 with DIN.ITBA/A.5T1S.114712021.2211035588068(1) as being passed without due application of mind, in gross violation of principles of natural justice and therefore is illegal, arbitrary and unsustainable in law and consequently set aside the same. lA NO: 1 OF 2021 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to stay the operation of the assessment order dated ',l5.09.2021 passed by Respondent with DIN.ITBA/ASTlsl14712021-22l1035588068(1), for the 4y.2017-18 and all consequential proceedings thereto including the collection of disputed taxes and levy of penalties. Counsel for the Petitioner: SRl. A.V. RAGHU RAM Counsel for the Respondents: SRI J.V. PRASAD (SENIOR SC FOR INCOME TAx) The Court made the following: ORDER HONOURABLE SRI JUSTICE UJJAL BHUYAN AND HONOURABLE DR.JUSTICE C.SUMALATHA W.P.N 0.26493 0F 2021 OR-DER: per Hon'ble SriJustice Ujjat Bhuyan) 1. Heard leamed counsel for the parties. 2 By filing this petition under Article 226 of the Constitution of India, petitioner seeks quashing of the assessment order 15.og.2o2r passed by the respondent for the assessment year 2or7-rg. 3. Challenge to the impugned order of assessment is on the ground that after the draft assessment order dated 04.0g.2021 was prepared, copy of the same along with the computation sheet were lurnished to the petitioner vide letter dated 06.09.2021 whereby an opportunity was granted to the petitioner to show cause as to why the proposed variation should not be made and assessment completed accordingly. By the said letter dated 06.09.zo2r,petitioner was asked to submit his response within three days thereafter i.e., by 09.09.2021. 4. Petitioner .requested the respondent for further one months, time to submit response on the ground that his Auditor was suffering from dengue feve. and had gone to Hyderabad for treatment. On receipt of such request of the petitioner, respondent granted time only till 13.09.2021, which included public holidays in the fbrm of Saturday and Sunday. 2 5. Learned counsel for the petitioner submits that the period given to the petitioner to submit response was highiy inadequate, considering the high value assessment and the variation sought to be added. Nonetheless, to ensure that petitioner did not go unrepresented before the final assessment order was passed, a general response was submitted by the petitioner. Thereafter, the irnpugned order was passed on 15.09.2021 under Section 147 read with Sections 144 and l44B of the Income Tax Act, 1961. 6. When the matter was taken up yesterday, we had put a query to learned counsel for the petitioner as to why petitioner has not availed the alternative remedy of filing appeal before the Commissioner of Income Tax (Appeals) under Section 246A of the Income Tax Act, 1961. 7. Today, learned counsel for the petitioner submits that this is a case where there is violation of the principles of natural justice. He submits that it is a settled proposition of raw that when there is violation of principles of natural justice, the aggrieved party can invoke the writ jurisdiction of the High court under Article 226 of the constitution of India notwithstanding availabirity of altemative remedy. To supporl his submission, he has placed reliance on a recent decision of the Supreme Court in THE ASSISTANT COMMISSIONER OF STATE TAX AND OTHERS v. M/s COMMERCIAL STEEL LIMITED', decided on 03 .Q9.2021 . 8. On the other hand, learned Senior Standing Counsel for the Income Tax Department submits that it is not a case where no oppofiunity was granted to the petitioner. As a matter of fact, petitioner was duly notified and petitioner had, in fact, submitted his response. According to the petitioner, he could have filed a better response if sonre more time would have been granted. In such circumstances, he submits that it is not a case of no notice or no hearing. Therelore, no exceptional circumstance has been made out to invoke the writ jurisdiction of this court. Petitioner has adequate and efficacious alternative remedy under the statute which he has not availed 9. We have considered the rival submissions made at the Bar. 10. There is no dispute to the proposition that if there is violation of the principles of natural justice or if the petitioner alleges violation of fundamental rights or if there is challenge lo lhe vires of any statute or there is an allegation of excess of jurisdiction, the High Court can invoke its extraordinary jurisdiction under Article 226 of the Constitution of India notwithstanding availability of alternative remedy. The larv on this point is well settled right from CALCUTTA DISCOUNT COMPANY LIMITED v. INCOME TAX OFFICBR, I Civjl Appeal No.5121 of 2021 COMPANIES DISTRICT, I AND OTHERS2 ANd WIITRLPOOL CORPORATION v. REGISTRAR oF TRADE MARKS, MUMBAI AND OTHERS3 and needs no reiterarion. Despite the long passage of time, there has been no change to this fundamental dictum of law. 11. Adverting to the facts of the present case, we are not convinced that it is a case of no notice or no hearing. Whether opportunity of hearing granted and availed was adequate or reasonable would depend upon the facts and circumstances of each case. There cannot be any straight jacket fo.nula. If as the petitioner contends the opportunity of hearing was inadequate which affected his right to make a proper response, certainly the same can be gone into by the appellate authority, since it may require examination of facts which we are not inclined to do in exercise ofour writ jurisdiction. 12. Consequently and having regard to the above, petitioner is relegated to the forum of appeal before the first appellate authority i.e., Commissioner of Income Tax (Appeals) under Section 246A of the Income Tax Act, 1961. To enable the petitioner to effectively avail the remedy of appeal, we direct that for the next 30 days from today, no coercive steps shall be taken by the respondent against the petitioner in terms of the impugned assessment order dated .,04.09.2021. It would be open to the petitioner to file necessary '? atR tg6t sc :zz 3 Air 1999 sc 22 ::4:: application either before the assessing officer or before the appellate authority for interim stay. Needless to say, ifsuch application is filed, the same shail be considered on its own merit and in accordance with law, We express no opinion. 13. With the above direction, the writ petition is disposed of. 14. Miscellaneous applications, if any pending, shall stand closed. 1 5. No costs. SD/.T.TIRUMALA DEVI ASSISTANT REGISTRAR l-r) To, CHR TR /iTRUE COPY// SECTION OFFICER '1 . The National Faceless Assessment Centre, lncome Tax Department, Ministry of Finance, Room No.401, 2nd Floor, E-Ramp, J.N. Stadium, Delhi- 110003. 2. One CC to Sri A.V. Raghu Ram, Advocate [OPUC] 3. One CC to Sri J.V. Prasad, Senior SC for INCOME TAX [OPUC] 4. Two CD Copies 5. One Spare Copy { HIGH COURT DATED:2711012021 ORDER W.P.No.26493 of 2021 DISPOSING OF THE WRIT PETITION WITHOUT COSTS t 1/ d 1E No'tlttpl * c r: {,- ( z .4, (- c 16E s14r€ at a r ) "