Refusal to block reopening of assessment under s.147 at interim notice stage; merits left to statutory process, not writ

HC refused to interfere with reopening of assessment under s.147 at the interim notice stage, holding that when the statutory proceedings are not concluded the writ court should not venture into merits. The court found no plain lack of jurisdiction from the notice and treated the challenge as one to the exercise of jurisdiction or factual error remedied by statutory routes. Given the settled distinction between jurisdictional defect and errors within jurisdiction, the HC dismissed the writ petition seeking pre-emptive relief under Articles 226/227.

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Issues:
1. Challenge to order under Section 148A(d) of the Income Tax Act, 1961 and notice issued under Section 148 for the assessment year 2018-2019.

Analysis:
The petitioner, a partnership firm, sought the quashing of an order dated 12.04.2022 passed under Section 148A(d) of the Income Tax Act, 1961, and a notice issued under Section 148 for the assessment year 2018-2019. The petitioner had responded to a notice under Section 148A(b) dated 14.03.2022 and raised objections, which were decided through the impugned order under Section 148A(d). The petitioner contended in the writ petition that their response to the initial notice was not considered. The central issue in this case was whether the court should delve into the merits of the controversy at the stage of a notice under Section 148, especially when the assessing officer (AO) is yet to complete the assessment/reassessment under Section 147 of the Act.

The court referred to previous judgments to establish that interfering at a premature stage when statutory proceedings are ongoing is unwarranted. It was highlighted that the distinction between jurisdictional error and errors within jurisdiction is crucial. The court emphasized that statutory remedies are available for rectification of errors, and interference by the court under Article 226/227 of the Constitution of India is not justified when proceedings are yet to be concluded by the statutory authority. The court dismissed the writ petition, clarifying that the decision should not be construed as an opinion on the merits of the case.

In conclusion, the court's decision was based on the principle that intervening in ongoing statutory proceedings prematurely is not appropriate, and statutory remedies should be pursued for rectification of errors. The court emphasized the importance of distinguishing between jurisdictional errors and errors within jurisdiction, highlighting that interference by the court at an intermediate stage is unwarranted. The judgment serves as a reminder that statutory procedures should be followed before seeking judicial intervention.

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