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of <h1>Court rejects challenge to assessment order under Income-tax Act, emphasizes compliance with notices.</h1> The court rejected the challenge to the assessment order under section 144 of the Income-tax Act, 1961, for the assessment year 1965-66. It emphasized ... This application under article 226 of the Constitution challenges the assessment order under section 144 of the Income-tax Act, 1961, in respect of the firm, Dhaniram Gupta & Co., for the assessment year 1965-66. The main ground urged in this application was that documents have been seized by the income-tax department under section 132 of the Income-tax Act, 1961, and, as such, it was not possible to comply with the notice under sections 142(1) and 143(2) of the Income-tax Act, 1961 - When the assessee has resorted to the alternative remedy, the High Court should not entertain application under article 226 of the Constitution Issues:Challenge to assessment order under section 144 of the Income-tax Act, 1961 based on seizure of documents under section 132. Failure to comply with notice under sections 142(1) and 143(2) due to seizure. Alternative remedy under section 146 of the Income-tax Act, 1961. Appeal filed by another partner without knowledge of one partner. Withdrawal of appeal once filed. Entertaining application under article 226 of the Constitution when an alternative forum is resorted to. Violation of principles of natural justice in assessment order under section 144. Non-compliance of section 186(7) of the Act. Disputed facts regarding cancellation of registration and filing of application for registration. Adequacy of alternative remedy and abandonment of the same.Analysis:The judgment challenges the assessment order of a firm under section 144 of the Income-tax Act, 1961, for the assessment year 1965-66. The main contention was the inability to comply with the notice under sections 142 and 143 due to documents being seized under section 132. The court rejected this argument, stating that the seizure did not render sections 143 and 144 inapplicable, especially when provisions under section 132 could have been utilized. The petitioner failed to avail of the alternative remedy under section 146 and did not explain the lack of compliance with the notice.The judgment highlighted an appeal filed by one partner without the knowledge of another, emphasizing that once an appeal is filed, it cannot be withdrawn. The court referred to a Supreme Court decision to support this principle. Additionally, the judgment discussed the importance of resorting to alternative forums and the dismissal of writ petitions when no explanation is provided for not pursuing the available remedies.Regarding the violation of natural justice in the assessment order, the court noted that some guesswork is permissible in such orders, citing a Judicial Committee decision. The judgment emphasized the need for honest estimation by the assessing officer, even if it involves guesswork based on available information.The judgment also addressed the alleged non-compliance with section 186(7) of the Act, stating that the petitioner proceeded under a misconception. The court advised that disputed facts regarding registration cancellation should be raised in an appeal, as an appeal had already been filed for the previous year's orders.Ultimately, the court concluded that the petitioner had an adequate alternative remedy and had already resorted to it, thus denying any relief in the current application. The judgment dismissed the application, discharged the rule nisi, and made no order on the connected chamber application, with no costs awarded.
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