TaxTMI 
TaxTMI 
2021 (8) TMI 616
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.... 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 as the same is only provision and not an ascer....
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....ontemplated, 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. ................ 12.A perusal of the reasons extracted elsewhere in this order only referred to ....
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....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 the Act. Therefore, the presumption cannot be construed as suppression on the part of the assessee. It is not a mere presumption in the present case b....
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....r 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 aggrieved. In the present case, admittedly, the summons were issued to the petitioner. However, the learned counsel for the petitioner entered appearance in the proceedings before the respo....
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....ed 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 assistance to the constitutional Courts to exercise the power of judicial review, effectively under Article 226 of the Constitution of India, for the purpose of providing complete justice to the parties to the....
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.... 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 procedures contemplated under the rules constituted thereon. While entertaining a writ petition as narrated by the Apex Court, the provision of efficacious alternative remedy under the statute also to be considered. If the writ peti....
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....) : 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 organs- legislature, executive and judiciary. In that sense, even in the absence of express provision for separation of power, the separation of power between legislature, executive and judiciary is not different from the constitutions of the countries which contain express provision for separation of powers. (ii) Independence of courts from the executive ....
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.... 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 cannot entertain the writ petitions in a routine manner by waiving the remedy of appeal provided under the statute. 21.Now, let us look into the legal principles settled by the Apex Court for exhausting the efficacious alternative remedy provided under the statute. 22.When an effective alternative remedy is available, a writ petition cannot be maintained 1. In City and Industrial Development Corporation v. D....
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.... 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 (8) SCC 110, and General Manager, Sri Siddeshwara Cooperative Bank Limited and another vs. Ikbal and others, 2013 (10) SCC 83. The writ petition ought to have been dismissed at the threshold on the ground of maintainability. The Division Bench erred in declining to interfere with the same. The Supreme Court agreed to the arguments and held the same also noted that the writ petition ought not to have been entertained and the interim order granted for the mere asking without assigning special reasons, and that too without even gra....
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....966] 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 natural justice. We may add that where the proceedings itself are an abuse of process of law the High Court in an appropriate case can entertain a writ petition." 18.The Hon'ble Supreme Court of India, in the case of M/s.Canon India Private Limited v. Commissioner of Customs [Civil Appeal No.1827 of 2018, dated 09.03.2021] dealt with the jurisdiction aspect with reference to the provisions of the statute in paragraph Nos.9, 12, 13 and 15, which all are extracted hereunder: "9.The question that arises is whether the Directorate of Revenue Intelligence had authori....
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....sess 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 statute which is not contemplated by any canon of construction of statute. ... 15.It is obvious that the re-assessment and recovery of duties i.e. contemplated by Section 28(4) is by the same authority and not by any superior authority such as Appellate or Revisional Authority. It is, therefore, clear to us that the Additional Director General of DRI was not "the" proper officer to exercise the power under Section 28(4) and the initiation of the recovery proceedings in the present case is without any jurisdiction and liable to be set aside." 19.The Appellate Tribunal, formed an opinion that the issuance of show ca....
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....ors 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 statutory provisions regarding the appeal to be preferred are to be decided at the first instance, enabling the litigants to avail the remedy by following the procedures as contemplated under law. Such writ petitions are filed may be on the ground of jurisdiction or otherwise. However, the Courts are expected to ensure that all such legal grounds available to the parties are adjudicated before the proper Forum and only after exhausting the statutory remedies, writ petitions are to be entertained. In the absence of exhausting such remedies, High Court is loosing the benefit of deciding the matter on merits as the High Court cannot conduct a....