2017 (8) TMI 1067 - HC - Income Tax

Court dismisses writ petitions citing maintainability under Article 226, applying precedent to prevent abuse of court process.

Kamal Galani Versus The Assistant Commissioner of Incometax, The Joint Commissioner of Incometax 23 (3), The Commissioner of Incometax 23 And The Union of India

The court dismissed the writ petitions, upholding the preliminary objection regarding their maintainability under Article 226 of the Constitution of ... Maintainability of second writ petition - abuse of this Court's jurisdiction - Levy of penalty - allegation of suppressing residential status to evade tax - earlier writ petition was withdrawn, when the same was taken up without seeking any liberty to file a fresh petition on the same cause of action. - Held that:- we would be failing in our duty if we do not apply Sarguja Transport's principle [1986 (11) TMI 377 - SUPREME COURT] to the present facts and circumstances. We have clearly noted the observations of this Court and which point towards an abuse of this Court's jurisdiction. The Court was persuaded to go on with the matter despite the objection raised by the respondents about the status of the petitioner. The petitioner despite noticing this position insisted on arguing the writ petition and argued it. After a preliminary hearing, on finding that it is not possible to get over the objection raised and the allegation of suppression of a material fact, the petitioner withdrew the writ petition, but without seeking any liberty to file a fresh petition on the same cause of action. We would be acting contrary to judicial discipline, if we entertain a second writ petition on the same cause of action but with a marginal improvement, as pointed out. We uphold the preliminary objection of the learned Additional Solicitor General and dismiss these writ petitions. Issues Involved:1. Maintainability of the writ petitions under Article 226 of the Constitution of India.2. Alleged suppression of material facts by the petitioner.3. Application of the principle from the Sarguja Transport Service case to the current petitions.Issue-wise Detailed Analysis:1. Maintainability of the writ petitions under Article 226 of the Constitution of India:The petitioner sought reliefs under Article 226 of the Constitution of India, requesting the quashing of an impugned notice, order, and penalty notice. The respondents raised a preliminary issue regarding the maintainability of these petitions, arguing that the petitioner had previously filed a similar writ petition (Writ Petition No.2823 of 2015) on the same cause of action, which was withdrawn without seeking liberty to file fresh petitions. The court noted that the earlier petition was indeed withdrawn without such liberty, and the current petitions were filed on the same cause of action and with identical prayers. The court upheld the preliminary objection, citing the principle from the Sarguja Transport Service case, which bars the filing of fresh writ petitions on the same cause of action if the earlier petitions were withdrawn without permission to file afresh.2. Alleged suppression of material facts by the petitioner:The respondents argued that the petitioner had made incorrect statements in the earlier petition, specifically regarding his property and income in India. The court noted that in the earlier petition, the petitioner stated he had no property in India, which was later found to be incorrect. The court observed that the petitioner attempted to explain this discrepancy but ultimately withdrew the petition without seeking liberty to file a fresh one. The court found that the petitioner's actions indicated an attempt to suppress material facts and engage in 'bench hunting' tactics, which should be discouraged.3. Application of the principle from the Sarguja Transport Service case to the current petitions:The court extensively discussed the principle established in the Sarguja Transport Service case, which bars the filing of fresh petitions on the same cause of action if the earlier petitions were withdrawn without permission to file afresh. This principle is founded on public policy to prevent abuse of the court's process and discourage 'bench hunting' tactics. The court noted that this principle had been applied in subsequent cases, including Upadhyay & Co. v. State of U.P. The court found that the present case involved similar circumstances, where the petitioner withdrew the earlier petitions without seeking liberty and then filed fresh petitions on the same cause of action. The court held that the bar established by the Sarguja Transport Service principle was clearly attracted in this case, and therefore, the current petitions were not maintainable.Conclusion:The court dismissed the writ petitions, upholding the preliminary objection regarding their maintainability. The court emphasized that the dismissal was based on the principle of public policy to prevent abuse of the court's process and did not reflect any opinion on the merits of the controversy. The petitioner was free to raise contentions before the Assessing Officer and other forums as permitted by law.