1969 (7) TMI 5 - SC - Income Tax

High Court rules appellant must exhaust alternative tax appeal remedy under Income-tax Act, not invoke special jurisdiction.

The High Court dismissed the appeal, ruling that the appellant should have pursued the alternative remedy of appeal under section 33B of the Income-tax ... Opportunity of being heard under section 33B - alternative remedy by statutory appeal - extraordinary writ jurisdiction under Article 226 - service requirements for proceedings under section 33B not equating to service under section 34/Order V Rule 17Alternative remedy by statutory appeal - extraordinary writ jurisdiction under Article 226 - Whether the appellant was entitled to invoke the High Court's extraordinary jurisdiction under Article 226 instead of pursuing the statutory appeal available under section 33B(3). - HELD THAT: - The Court held that where an alternative and equally efficacious statutory remedy exists - here an appeal under the Act - it is ordinarily appropriate for the litigant to pursue that remedy rather than invoke the High Court's writ jurisdiction. Although the existence of an alternative remedy does not oust writ jurisdiction, it is a discretionary factor warranting refusal of relief in the absence of good grounds for bypassing the statutory remedy. The appellant offered no explanation in the writ petition for not preferring the available appeal, and the High Court could properly have dismissed the petition in limine on that basis.The High Court was justified in declining to exercise writ jurisdiction in preference to the statutory appeal; the appellant's recourse to Article 226 was not warranted.Opportunity of being heard under section 33B - service requirements for proceedings under section 33B not equating to service under section 34/Order V Rule 17 - Whether, on the facts, the appellant was afforded the opportunity of being heard as required by section 33B and whether the manner of service rendered the proceeding invalid. - HELD THAT: - On examination of the evidence the Court accepted the High Court's finding that the assessee had been given an opportunity to be heard. The assessee had admitted the address used for prior statutory notices, the officer's report recited attempts at personal service and affixation at that address, and postal attempts were made and returned unclaimed. The Court emphasised that section 33B only requires that an opportunity to be heard be given and does not incorporate the more stringent service formalities of section 34 or Order V, rule 17; therefore non-compliance with the civil code service formality did not vitiate the proceeding under section 33B. Having regard to the evidence and the correct legal standard, the Court saw no reason to disturb the High Court's finding.The assessee was given the opportunity required by section 33B and the order reopening the assessments was not defective for want of service as contended.Final Conclusion: The appeal is dismissed; the High Court's decision upholding the reopening under section 33B and its exercise of discretion as to writ jurisdiction are affirmed, with costs. Issues:1. Jurisdiction of High Court under article 226 of the Constitution versus alternative remedy of appeal under section 33B of the Income-tax Act.2. Adequacy of opportunity given to the appellant before the order under section 33B of the Act was made.3. Validity of service of notice under section 33B and applicability of civil procedure rules.Analysis:The judgment revolves around the appellant's appeal regarding the cancellation of assessment orders under the Income-tax Act, 1922. The primary issue raised is whether the appellant was entitled to invoke the special jurisdiction of the High Court under article 226 of the Constitution or if an appeal under section 33B of the Act would have been more appropriate. The court emphasized that when an alternative and equally efficacious remedy is available, the litigant should pursue that remedy rather than seek a writ. The court cited previous cases to highlight that the High Court's extraordinary jurisdiction should be reserved for cases involving fundamental rights or jurisdictional errors by taxing authorities.Regarding the adequacy of the opportunity given to the appellant, the court found that the appellant had been provided with a chance to be heard before the order under section 33B was made. The appellant's claim of not being aware of the notice was contradicted by evidence showing that notices were sent to her address and attempts were made for personal service. The High Court concluded that the appellant had refused to accept the notice, indicating that she was aware of the proceedings, thus fulfilling the requirement of providing an opportunity to be heard.The judgment also delved into the validity of the service of notice under section 33B and the applicability of civil procedure rules. While the appellant argued that the service of notice by affixing did not strictly adhere to civil procedure rules, the court clarified that section 33B did not explicitly require such strict notice procedures as in other sections of the Act. The High Court's examination of the evidence led to the conclusion that the appellant had indeed been given an opportunity to be heard before the order was issued, thereby upholding the validity of the service of notice under section 33B.In conclusion, the court dismissed the appeal, affirming that the appellant was not entitled to any relief. The judgment highlighted the importance of exhausting alternative remedies before seeking extraordinary jurisdiction and emphasized the necessity of providing adequate opportunities for the parties involved in tax assessment proceedings.