TaxTMI 
TaxTMI 
2025 (8) TMI 629
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.... assessment framed under Section 147 read with 144 of the Income Tax Act, 1961, vide Order dated 26.03.2025 of Income Tax Officer, Ward-3(2), Purulia (Annexure-12), the petitioner has approached this Court insisting to invoke extraordinary jurisdiction under the provisions of Articles 226 and 227 of the Constitution of India, with the following prayer(s): "Under the aforesaid circumstances it is prayed therefore that this Hon‟ble Court may be graciously pleased to: a. Admit the Writ Application; b. Issue rule nisi calling upon the Opposite Party No.2 as to why Order of Assessment dated 26.03.2025 vide Annexure-12 shall not be quashed being illegal, arbitrary, unsustainable in law, gross violation of principles of natural justice and without jurisdiction. c. If the Opposite Parties fails to show cause or show insufficient cause, make the rule absolute; d. To issue further writ in the nature of mandamus or any other appropriate writ directing Opposite Parties to quash the Order of Assessment dated 26.03.2025 vide Annexure-12 in the ends of justice; e. To pass such further order/orders, direction/ directions, writ/writs as ma....
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....ish documents/evidences, the petitioner could convince the Assessing Officer that the transactions were genuine and the claim made in the self-assessment returns is just and proper. Hearing: 3. At the consent of the counsel for the respective parties, this matter is taken up for final hearing at the stage of "Fresh Admission" as short point is involved whether to entertain the writ petition challenging the assessment order by circumventing remedy provided under the IT Act. 3.1. Heard Sri Jagabandhu Sahoo, learned Senior Advocate assisted by Ms. Kajal Sahoo, learned Advocate for the petitioner and Sri Subash Chandra Mohanty, learned Senior Standing Counsel assisted by Sri Avinash Kedia, learned Junior Standing Counsel, for the Income Tax Department. Submissions and arguments : 4. Sri Jagabandhu Sahoo, learned Senior Advocate submitted that had the Assessing Officer granted proper opportunity to explain the details of the transactions with the alleged non-existent suppliers, he would have adduced evidence like e-waybills, tax invoices and other documents. He further submitted that the Assessing Officer should not have proceeded with the assessment awaiting response fro....
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....h issues as certified by the physician attending him at Institute of Medical Sciences and SUM Hospital, Bhubaneswar. The learned Senior Standing Counsel did not dispute veracity of such documents. However, the objection of the learned Senior Standing Counsel deserves to be taken into consideration that the petitioner sought to drag the proceeding for assessment knowing fully well that the assessment would be barred by limitation on 31.03.2025, yet in his petition for adjournment dated 19.03.2025 he prayed for grant of one month's accommodation to trace out documents and submit evidence. Therefore, this Court has made minute examination of documents enclosed to the writ application to test the authenticity of the claim of the petitioner. 6.1. A detailed Show Cause Notice dated 11.03.2025 was issued to the petitioner eliciting the result of investigation with respect to alleged bogus purchase transactions made with certain named suppliers leading to initiation of proceeding for assessment on best of judgment under Section 144 of the IT Act. To this the petitioner has stated to have responded by filing reply dated 19.03.2025 by partially explaining the facts, but made the following....
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....3.2025 that the proceeding commenced from March, 2024. The copy of document showing medical exigency issued by the Institute of Medical Sciences and SUM Hospital, Bhubaneswar depicts the following facts: "This is to certify that Mr. Samir Kundu *** is under my treatment as an out-patient /in-patient at this Hospital was treated as OPD patient from 15.12.2022 to 06.02.2024 was admitted as in-door patient on and discharged on . He/she had been advised rest for above days. He/she is fit to resume normal duties from 07.02.2024." 6.5. A copy of "Death Declaration Certificate" dated 01.03.2024 issued from the Office of the Pradhan, Chandra Gram Panchayat, At & PO: Chandra, PS: Kenda, District: Purulia, West Bengal shows that the wife of the petitioner died three years ago, though exact date of death is not disclosed. 6.6. The medical documents does not indicate that the petitioner was ever admitted in the Hospital as an in- patient. The documents enclosed to writ petition do not evince the fact that after 07.02.2024 the petitioner was ever admitted to hospital or had any complaint regarding health issues. Hence, such documents furnished by the petitioner ....
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....essment Order dated 26.03.2025 (Annexure-12) so as to warrant indulgence. 7. An attempt has been made by the learned Senior Advocate to question the jurisdiction of the Assessing Officer under the Faceless Assessment process. It is contended that the business of the petitioner-assessee being situated in the State of Odisha and the returns being filed before the authority in this State, the Assessing Officer of Ward 3(2) of Income Tax Department at Purulia in the State of West Bengal does not have the jurisdiction to issue notice under Section 148 and proceed with the assessment. 7.1. Referring to Biswajaya Dagara Vrs. Assistant Commissioner of Income Tax, 2023 SCC OnLine Ori 7091 it is submitted that "the petitioner will continue to be within the jurisdiction where he has been filing his return". To buttress his contention that the Income Tax Officer sitting at Purulia in West Bengal has no jurisdiction to exercise for assessment under Section 147 read with Section 144 by issue of notice Section 148 of IT Act learned Senior Counsel placed heavy reliance on the decision of the High Court of Telangana rendered in Venkataramana Reddy Patloola Vrs. Deputy Commissioner of Income T....
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.... and international tax charges (paragraph 24)" and "Since notices under Section 148 of the Act were not issued in a faceless manner, the entire further proceeding founded upon it and assessment orders stand vitiated (paragraph 29)". 7.5. No case is set up by the instant petitioner with respect to "international tax charge" or "central charges", as such the challenge as to jurisdiction of the Income Tax Officer, Ward 3(2) of Purulia does not call for any adjudication at this stage, particularly so when the petitioner in paragraph 2 of its reply dated 19.03.2025 (portion of which has already been extracted herein above) in response to Show Cause Notice dated 11.03.2025 surrendered to the jurisdiction of the Assessing Officer, Ward 3(2), Purulia, West Bengal and in the "prayer" he has sought for "reasonable time to adduce more documentary evidence". 7.6. Deepak Agro Foods Vrs. State of Rajasthan, (2008) 10 SCR 877 is a case to the point to emphasise the effect of "irregular assumption of jurisdiction" as opposed to "illegal assumption jurisdiction". In the said case the following observations of the Hon'ble Supreme Court of India may be pertinent to consider the plea of the peti....
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....sts between a decree passed by a court having no jurisdiction and consequently being a nullity and not executable and a decree of the court which is merely illegal or not passed in accordance with the procedure laid down by law. A decree suffering from illegality or irregularity of procedure, cannot be termed inexecutable. 18. In view of the above, in the present case, apart from the fact that on a plain reading of Section 29(8)(b) of the Act, it is manifestly clear that fresh assessment for the assessment year 1995-96, framed pursuant to the order passed by the appellate authority on 8th June, 2000, was well within the prescribed time, even otherwise, in the light of the afore-stated settled law, the assessments orders in question could not be held to be null and void on account of the stated irregularities committed by the assessing officer during the course of assessment proceedings. In our opinion, therefore, despite scathing observations by the Division Bench on the conduct of the assessing officer, it was a case of an irregularity in assessment proceedings by the officer, who was not bereft of authority to assess the appllant. At best, it was an illegality, which def....
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.... questioned in those very proceedings, but subject to that it is good, and not open to collateral attack. Therefore even if the proceedings for assessment were taken against a non-registered dealer without the issue of a notice under Section 10(1) that would be a mere irregularity in the assumption of jurisdiction and the order of assessment passed in those proceedings cannot be held to be without jurisdiction and no suit will lie for impeaching them on the ground that Section 10(1) had not been followed. This must a fortiori be so when the appellant has itself submitted to jurisdiction and made a return. We accordingly agree with the learned Judges that even if the registration of the appellant as a dealer under Section 8 is bad that has no effect on the validity of the proceedings taken against it under the Act and the assessment of tax made thereunder." 7.8. Coming back to the factual details as discussed in the foregoing paragraphs, untrammelled statement made before the Assessing Officer in his reply dated 19.03.2025 that the petitioner beseeches "unconditional apology" for not having submitted any response to the notices issued during 30.03.2024 to 03.03.2025. This would s....
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....stigation was carried out by DDIT (Inv)- 2(3), Bhubaneswar in the case of M/s. dhanalaxmi Iron, Prop: Iswar Chandra Barik, PAN DZLPB1223H. From this enquiry it is established that M/s. Dhanalaxmi Iron was never filed its income tax return and is a fictitious/non- existing entity. M/s. Dhanalaxmi Iron, Prop: Iswar Chandra Barik has made sales to M/s. Ganapati Enterprises, Prop: Sumati Mukhi, PAN: EWQPM1326F which is also a non-filer and fictitious entity. Further Ganapati Enterprises, Prop: Sumati Mukhi has issued sale bills to M/s. Utsav Enterprises, Prop: Dharma Nayak, PAN: BOSPN3468J which is also a non-filer. Then M/s. Utsav Enterprises, Prop: Dharma Nayak, PAN: BOSPN3468J has issued sale bills to other parties who are regularly filing their return of income. It is established from the enquiry that M/s. Utsav Enterprises, Prop: Dharma Nayak, is a fictitious/non-existing entity formed for providing accommodation entries to other entity or persons. The investigation also revealed that some parties have availed input tax credit (ITC) of the strength of bogus invoices issued by these fictitious/non-existing entities. During the above, enquiry, it is found that M/s. Utsav En....
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....esolving factual anomaly by the writ Court. This Court desists from doing such exercise. This Court feels it pertinent to have reference to a Judgment rendered by the Delhi High Court in Banson Enterprises Vrs. Assistant Commissioner, W.P.(C) No.6503 of 2025, decided on 15.05.2025 [reported at 2025 SCC OnLine Del 3952] declining to entertain writ petition challenging Show Cause Notice, which also has application to the challenging any order or decision which is available for challenge before the appellate authority under the statutory framework. The observation of said Court runs as follows: "10. The Court has considered the matter. As held in Assistant Commissioner of State Tax Vrs. Commercial Steel Limited (2021) 7 SCR 660, a writ petition can be entertained under exceptional circumstances only which are set out in the said judgment as under: "11. The respondent had a statutory remedy under Section 107. Instead of availing of the remedy, the respondent instituted a petition under Article 226. The existence of an alternate remedy is not an absolute bar to the maintainability of a writ petition under Article 226 of the Constitution. But a writ petition can be ente....
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....re is no justification for not challenging the same by way of an appeal. 14. An appeal before the appellate authority is a full- fledged remedy provided under Section 107 of the Central Goods and Service Tax Act, 2017. 15. The contentions that the Petitioner wishes to raise can always be raised in appeal, inasmuch as this Court has already taken a view in W.P.(C) 5737 of 2025 titled Mukesh Kumar Garg Vrs. Union of India & Ors. [decided on 09.05.2025 reported at 2025 SCC OnLine Del 3324] In the said case, the Court, has already taken a view in this regard that where cases involving fraudulent availment of ITC are concerned, considering the burden on the exchequer and the nature of impact on the GST regime, writ jurisdiction ought not to be usually exercised in such cases. The relevant portions of the said judgment are set out below: "11. The Court has considered the matter under Article 226 of the Constitution of India, which is an exercise of extraordinary writ jurisdiction. The allegations against the Petitioner in the impugned order are extremely serious in nature. They reveal the complex maze of transactions, which are alleged to have been car....
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....isdiction, cannot adjudicate upon or ascertain the factual aspects pertaining to what was the role played by the Petitioner, whether the penalty imposed is justified or not, whether the same requires to be reduced proportionately in terms of the invoices raised by the Petitioner under his firm or whether penalty is liable to be imposed under Section 122(1) and Section 122(3) of the CGST Act. 18. The persons, who are involved in such transactions, cannot be allowed to try different remedies before different forums, inasmuch as the same would also result in multiplicity of litigation and could also lead to contradictory findings of different Forums, Tribunals and Courts.' 16. Under these circumstances, this Court is not inclined to entertain the present writ petition.‟ ***" 8.7. In Commissioner of Income Tax Vrs. Chhabil Dass Agrawal, (2014) 1 SCC 603 the exposition of law has been reiterated in the following terms: "11. Before discussing the fact proposition, we would notice the principle of law as laid down by this Court. It is settled law that non-entertainment of petitions under writ jurisdiction by the High Court when an efficacious alternativ....
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.... (2001) 8 SCC 509, Pratap Singh Vrs. State of Haryana, (2002) 7 SCC 484 and GKN Driveshafts (India) Ltd. Vrs. ITO, (2003) 1 SCC 72.]" 8.8. On the set of principles enunciated for consideration of jurisdiction to entertain writ petition against order of assessment for which efficacious alternative remedy is available under the statute, as enumerated hereinabove, when the present contents of the writ petition is tested, the averments and fact-situation narrated by the petitioner do not seem to have fallen within such parameters. 8.9. In the present case, since disputed question of fact is patently perceived on the record, this Court is of the considered view that the appellate authority is the competent authority to deal with the facts as well as the law including the point of jurisdiction of the Assessing Authority. It deserves to be observed that the question whether Office of Income Tax Officer, Purulia in the State of West Bengal has the jurisdiction to proceed with the assessment under the IT Act is essentially a mixed question of fact and law. Therefore, issues raised in the present case can very well be addressed to in appeal under the IT Act. If need be other alternativ....