Court Dismisses Petition Over Tax Jurisdiction; Emphasizes Statutory Appeal

The court dismissed the petition challenging the assessment order jurisdiction under Section 144 of the Income Tax Act, 1961 by a Non Resident Indian. The court held that the petitioner's claim of being a Non Resident Indian was unsubstantiated, as the assessing officer found the petitioner's status to be that of a "resident." The court emphasized that the statutory right of appeal under Section 246 (1) (a) should be utilized to challenge assessment orders, rather than filing a writ petition under Article 226 of the Constitution. Consequently, the court declined to entertain the petition, directing the petitioner to pursue the statutory remedy of filing an appeal under Section 246 (1) (a).

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Issues:
Challenge to assessment order jurisdiction under Section 144 of the Income Tax Act, 1961 by a Non Resident Indian.

Analysis:
The petitioner, claiming to be a Non Resident Indian, contested the assessment order dated 21 March, 2016, issued by the Income Tax Officer Ward-3 (1), Bulandshahar, under Section 144 of the Income Tax Act, 1961 for the assessment year 2013-14. The petitioner argued that the assessing officer did not have jurisdiction as it solely vested with the Commissioner of Income Tax (International Taxation)-3, Delhi, or an authorized person as per circulars issued. The assessing officer found that the petitioner filed as a "resident" on 31 March 2014, and the claim of being a Non Resident Indian based on a passport was unsubstantiated. Despite seeking information from relevant authorities, the claim remained unverified, leading to the conclusion that the petitioner's status was that of a "resident."

A preliminary objection was raised regarding the petitioner's right to challenge the jurisdiction issue through a writ petition, contending that the matter could be addressed in an appeal under Section 246 (1) (a) of the Act. The petitioner's counsel cited a Supreme Court decision to support the argument that a writ petition could be filed when the question of jurisdiction was at stake. However, the court noted that the impugned order was appealable under Section 246 (1) (a), which allows an assessee aggrieved by certain orders, including those related to residency status, to appeal to the Deputy Commissioner (Appeals).

The court emphasized that the statutory right of appeal provided under Section 246 (1) (a) must be availed of, as the Act offers a complete mechanism to challenge assessment orders. Referring to a Supreme Court judgment, the court highlighted that orders of assessment should be challenged through the prescribed statutory route and not via a petition under Article 226 of the Constitution. Consequently, the court declined to entertain the petition, stating that the petitioner had the statutory remedy of filing an appeal under Section 246 (1) (a). The petition was dismissed accordingly.

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