TaxTMI 
TaxTMI 
2021 (8) TMI 616
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....f of the petitioner would submit that it is a case where the impugned orders of assessment were passed in violation of principles of natural justice and the authority who passed the impugned orders of assessment lacks jurisdiction and further, the mandatory requirements as contemplated under proviso to Section 147 of the Act has not been adhered to. 4.To substantiate the said contention, the learned Senior Counsel drawn the attention of this Court regarding the notice issued under Section 148 of the Act in proceedings dated 25.02.2010. Though the notice was issued on 25.02.2010, it was received by the petitioner on 08.09.2010. There was a delay of about 7 months even to serve Section 148 notice. Thus, a factual inference is to be drawn that the notice was not served within the period of limitation and the Courts have held that service of notice also to be taken into account for the purpose of deciding the point of limitation. The reasons furnished for reopening of assessment was communicated in proceedings dated 16.09.2010, which reveals that "it is noticed that provisions for anticipated contract losses of Rs. 10835 Lakhs to be added back in computing the book profit u/s 116 JB....
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....a violation of principles of natural justice. The opportunity, as contemplated, were not granted to the petitioner. The authority was lacking in jurisdiction. Therefore, the Writ Petitions are to be admitted and the original files are to be called for, for the purpose of scrutinization. 7.In support of the contentions, the learned Senior Counsel relied on the judgment in the case of International Flavours Fragrances India Pvt. Ltd., vs. Joint Commissioner (LTU) and others, reported in [2020] 429 ITR 28 (Mad), wherein, the Court made the following observations: "8.Proceedings for re-assessment initiated beyond four years from the end of the relevant assessment year have to satisfy the added condition set out in the proviso to Section 147 of the Act. Normally, the time limit for initiation of re- assessment is four years from the end of the subject assessment year with an extended period of two years provided to the Department conditional upon the Department establishing that the alleged escapement of income was attributable to the failure of the assessee to file a return or to make a full and true disclosure of its income for the relevant period. ...................
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....yond four years, then it must be established that the assessee has not disclosed fully and truly all material evidence with an intention to escape from the payment of tax. Mere non-disclosure is insufficient in view of the fact that the assessee may have certain opinions in the matter of furnishing certain details to the Assessing Officer. Therefore, the motive or intention on the part of the assessee for such non-disclosure is also a material ground to be considered by the Courts as well as by the authority at the time of reopening of assessment beyond the period of four years. 16.In respect of the case on hand, undoubtedly, the assessee had not submitted the ratification certificate to be obtained from the CBDT for claiming exemption under Section 10B of the Act. However, there are certain confusions even within the Department Officials regarding production of such ratification certificate from the CBDT. The dispute arises in view of the fact that the assessee is of an opinion that the approval granted by the STPI under the delegated powers of the Directors of STPI by IMSC is a valid approval for the purpose of claiming exemption under Section 10B of th....
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....the case of TIN Box Company, New Delhi Vs. CIT, New Delhi, reported in (2001) 9 SCC 725, made an observation as follows: "2................That order must be made after the assessee has been given a reasonable opportunity of setting out his case. We, therefore, do not agree with the Tribunal and the High Court that it was not necessary to set aside the order of assessment and remand the matter to the assessing authority for fresh assessment after giving to the assessee a proper opportunity of being heard. ............ 5.................The matter shall now be remanded to the assessing authority for fresh consideration, as aforestated. No order as to costs." 10.In the case of T.M.Hotels Private Limited Vs. The Additional Commissioner of Central Excise, this Court passed an order on 06.07.2021 in W.P.No.14099 of 2014 as under: "7.This Court is of the considered opinion that in all circumstances, the parties aggrieved are bound to prefer an appeal before the appellate authority. However, in certain circumstances, the Courts are bound to consider whether the denial of opportunity caused certain prejudice to the interest of the person aggr....
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....he Country. In all circumstances, the aggrieved person is bound to exhaust the appellate remedy provided under the relevant statutes. Only on exceptional circumstance, where the order in question was issued by an incompetent authority having no jurisdiction under the provisions of the statute or allegations of malafides are raised, then a writ proceedings may be entertained. Even in case of raising an allegation of malafides, the authority against whom such an allegation is raised must be impleaded as party respondent in his personal capacity. 15.The importance of exhausting the appellate remedy is consistently insisted upon by the constitutional Courts. The efficacious remedy provided under the statute need not be undermined, nor an opportunity provided to the aggrieved person under the statute need not be taken away in casual and routine manner. In the event of dispensing with the appellate remedy, the aggrieved person is deprived of an opportunity to adjudicate the disputes/merits with reference to the original documents and evidences. Undoubtedly, the appellate authority is the final fact finding authority and their findings in a appellate proceedings may be of valuable a....
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.... Income Tax, Chennai and another [W.P.No.22508 of 2017 dated 16.07.2018], from which, the following paragraphs are extracted : "19.Unnecessary or routine invasion into the statutory powers of the competent authorities under a statute should be restrained by the Constitutional Courts. Frequent or unnecessary invasions in the executive power will defeat the constitutional perspectives enshrined under the Constitution of India. Undoubtedly, the separation of powers under the Indian Constitution has been narrated and settled in umpteen number of judgments. Separation of powers demarcated in the Constitution of India is also to be considered, while exercising the powers of judicial review in the matter of dispensing with the appeal remedy provided for an aggrieved person under a statute. If the High Courts started interfering with such Appellate powers without any valid and substantiated reasons, then the very purpose and object of the statute and provision of appeal under the statute became an empty formality and the High Courts also should see that the provisions of appeal contemplated under the statutes are implemented in its real spirit and in accordance with the p....
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....e, the Executive and the Judiciary. Even though the Constitution has adopted the parliamentary form of government where the dividing line between the legislature and the executive becomes thin, the theory of separation of powers is still valid. 4. State of Tamil Nadu and Ors. vs. State of Kerala and Ors. (07.05.2014 - SC) : MANU/SC/0425/2014 121. On deep reflection of the above discussion, in our opinion, the constitutional principles in the context of Indian Constitution relating to separation of powers between legislature, executive and judiciary may, in brief, be summarized thus: (i) Even without express provision of the separation of powers,the doctrine of separation of powers is an entrenched principle in the Constitution of India. The doctrine of separation of powers informs the Indian constitutional structure and it is an essential constituent of rule of law. In other words, the doctrine of separation of power though not expressly engrafted in the Constitution, its sweep, operation and visibility are apparent from the scheme of Indian Constitution. Constitution has made demarcation, without drawing formal lines between the three o....
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....inion that institutional respects are to be maintained by the constitutional Courts. Whenever there is a provision for an appeal under the statute, without exhausting the remedies available under the statute, no writ petition can be entertained in a routine manner. Only on exceptional circumstances, the remedy of appeal can be waived, if there is a gross injustice or if there is a violation of fundamental rights ensured under the Constitution of India. Otherwise, all the aggrieved persons from and out of the order passed by the original authority is bound to approach the Appellate Authority. The Constitutional Courts cannot make an appeal provision as an empty formality. Every Appellate Authority created under the statute to be trusted in normal circumstances unless there is a specific allegation, which is substantiated in a writ proceedings. Thus, the institutional functions and exhausting the appeal remedies by the aggrieved persons, are to be enforced in all circumstances and writ proceedings can be entertained only on exceptional circumstances. Rule is to prefer an appeal and entertaining a writ is only an exception. This being the legal principles to be followed, this Court ca....
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....tution if an effective alternative remedy is available to the aggrieved person or the statute under which the action complained of has been taken itself contains a mechanism for redressal of grievance still holds the field. Therefore, when a statutory forum is created by law for redressal of grievances, a writ petition should not be entertained ignoring the statutory dispensation. 4. Authorized Officer, State Bank of Travancore and Ors. vs. Mathew K.C. (30.01.2018 - SC) : MANU/SC/0054/2018 The petitioner argued that the SARFAESI Act is a complete code by itself, providing for expeditious recovery of dues arising out of loans granted by financial institutions, the remedy of appeal by the aggrieved under Section 17 before the Debt Recovery Tribunal, followed by a right to appeal before the Appellate Tribunal under Section 18. The High Court ought not to have entertained the writ petition in view of the adequate alternate statutory remedies available to the Respondent. The interim order was passed on the very first date, without an opportunity to the Appellant to file a reply. Reliance was placed on United Bank of India vs. Satyawati Tandon and others, 2010 ....
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....in the matter of issuing writs. However, the remedy of writ is an absolutely discretionary remedy and the High Court has always the discretion to refuse to grant any writ if it is satisfied that the aggrieved party can have an adequate or suitable relief elsewhere. The Court, in extraordinary circumstances, may exercise the power if it comes to the conclusion that there has been a breach of principles of natural justice or procedure required for decision has not been adopted. 7. First Income-Tax Officer, Salem v. M/s. Short Brothers (P) Ltd., [1966] 3 SCR 84 and State of U.P. and Ors. v. M/s. Indian Hume Pipe Co. Ltd., [1977] 2 SCC 724. There are two well recognized exceptions to the doctrine of exhaustion of statutory remedies. First is when the proceedings are taken before the forum under a provision of law which is ultra vires, it is open to a party aggrieved thereby to move the High Court for quashing the proceedings on the ground that they are incompetent without a party being obliged to wait until those proceedings run their full course. Secondly, the doctrine has no application when the impugned order has been made in violation of the principles of....
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.... Such a power is not inherent in any authority. Indeed, it has been conferred by Section 28 and other related provisions. The power has been so conferred specifically on "the proper officer" which must necessarily mean the proper officer who, in the first instance, assessed and cleared the goods i.e. the Deputy Commissioner Appraisal Group. Indeed, this must be so because no fiscal statute has been shown to us where the power to re-open assessment or recover duties which have escaped assessment has been conferred on an officer other than the officer of the rank of the officer who initially took the decision to assess the goods. 13.Where the statute confers the same power to perform an act on different officers, as in this case, the two officers, especially when they belong to different departments, cannot exercise their powers in the same case. Where one officer has exercised his powers of assessment, the power to order re-assessment must also be exercised by the same officer or his successor and not by another officer of another department though he is designated to be an officer of the same rank. In our view, this would result into an anarchical and unruly operation of a....
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....urisdictional errors are quashed without any remand, then an injustice would be caused to the very spirit of the Statute enacted for the benefit of the public at large. The procedures to be followed in the department for assessment is well settled. Thus, the authorities competent are not expected to commit patent jurisdictional errors in a routine manner. In these circumstances, review of such orders by the higher authorities are imminent to form an opinion that there is any willful or intentional act for commission of such jurisdictional errors, enabling the assesses to get exonerated from the liability. Liability and jurisdictional errors are distinct factors, and therefore, Courts are expected to provide an opportunity to the Department to decide the liability on merits and in accordance with law with reference to the provisions of the Act and Rules and guidelines issued by the Department. 22.Large number of writ petitions are filed without exhausting the statutory appeal remedies and High Court is also entertaining such writ petitions in a routine manner. Keeping such writ petitions pending for long time would cause prejudice to the interest of the assessee also. Thus, such ....