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2026 (4) TMI 129
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....("erstwhile entity") got amalgamated with Kappa Investment Limited. The name of the said company was subsequently changed to Aricent Technologies (Holdings) Limited. Thereafter, M/s. Aricent Technologies (Holdings) Limited got amalgamated with the Petitioner vide order dated 23.12.2022 of the National Company Law Tribunal, Mumbai Bench in CP (CAA)/183/MB/2022 and CA (CAA)/56/MB/2022. (b) In February 2023, the Petitioner received a notice under Section 220 of the Act [dated 05.02.2023] from Respondent No. 2. In the said notice, the Petitioner was asked to pay the outstanding demand, inter alia, of Rs. 3,28,785/- for A.Y. 2001-02 Rs. 1,24,577/- for A.Y. 2002-03 and Rs. 28,87,714/- for A.Y. 2003-04. The said notice was in the name of the erstwhile entity, namely, Flextronics Software Systems Limited. (c) The Petitioner contends that it was not aware of any such outstanding demands. Upon receipt of the recovery notice, the Petitioner filed applications under the Right to Information Act, 2005 ("the RTI Act") seeking copies of the orders giving rise to such demands. (d) The Petitioner received a reply from Respondent No. 2 stating that for A.Y. 2001-02 and 200....
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....notices issued by Respondent No. 2, therefore, it is argued that the Petitioner should be relegated to the Delhi High Court. Mr. Gupta relied upon a compilation of judgments to buttress his submission. He placed reliance on the decision of the Supreme Court in Principal Commissioner of Income Tax-I V/S ABC Papers Limited [(2022) 9 SCC 1] to contend that an appeal under the Act is to be filed before the Tribunal/ Court within whose jurisdiction the Assessing Officer, who passed the order appealed against, is located. He argued that in the said judgment, even where the case of an assessee was subsequently transferred under Section 127 of the IT Act, still the Hon'ble Apex Court held that an appeal has to be filed before the Tribunal/ Court within whose jurisdiction the Assessing Officer, who passed the original order appealed against, is located. He, accordingly, submitted that in the present case, since the recovery and demand notices have been allegedly issued and raised by an Officer in Delhi, even the Writ Petition should be filed in Delhi High Court. He also heavily relied on the Constitution Bench decision in Lt. Col. Khajoor Singh V/S Union of India [AIR 1961 SC 532] to ar....
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....n here, thereby conferring jurisdiction on this Court to exercise its power under Article 226 of the Constitution. Mr. Gandhi relied on a series of decisions including Kusum Ingots & Alloys Ltd. V/S Union of India [(2004) 6 SCC 254], Om Prakash Srivastava V/S Union of India [(2006) 6 SCC 207], Navinchandra N. Majithia V/S State of Maharashtra [(2000) 7 SCC 640], Nawal Kishore Sharma V/S Union of India [(2014) 9 SCC 329], Teleperformance Global Services Pvt. Ltd. V/S ACIT [(2021) 435 ITR 725 (Bom)], Uber India Systems Pvt. Ltd. V/S ACIT [(2024) 168 taxmann.com 200 (Bom)], Vincent Commercial Company Limited V/S ITO [Writ Petition (L) No. 10838 of 2025], Wills India Insurance Brokers (P.) Ltd. V/S IRDA [(2012) 22 taxmann.com 154 (Bom)] and Damomal Kauromal Raisingani V/S Union of India [AIR 1967 Bom 355], to support his contention. 8. Mr. Gandhi then argued that the decision in Lt. Col. Khajoor Singh (supra) is not applicable on the ground that it was rendered prior to the amendment of Article 226 in 1963. He submitted that Lt. Col. Khajoor Singh (supra) dealt with the issue whether cause of action can be considered as a valid criteria under Article 226 to entertain a Writ Petition....
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....dia [AIR 1961 SC 532], wherein it was held that the concept of cause of action could not be introduced in Article 226 [as it then stood]. The Court held that jurisdiction depended on the person or authority passing the order being within the territories of the High Court. It would be relevant to first refer to the issues raised and considered by the Constitution Bench as brought out in Paragraph 11 which is reproduced hereunder:- "11. The two main questions which arise, therefore, are : (i) whether the Government of India as such can be said to have a location in a particular place viz. New Delhi, irrespective of the fact that its authority extends over all the States and its officers function throughout India, and (ii) whether there is any scope for introducing the concept of cause of action as the basis of exercise of jurisdiction under Article 226. Before, however, we deal with these two main questions, we would like to clear the ground with respect to two subsidiary matters which have been urged on behalf of the appellant." (emphasis supplied) 13. This was answered by the Court in Paragraph 16 which is reproduced hereunder:- "16. ....
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.... be introduced into it for that would do away with the two limitations on the powers of the High Court contained in it." (emphasis supplied) 14. In fact, in paragraph 17, the Court went on to hold as under:- "17. We have given our earnest consideration to the language of Article 226 and the two decisions of this Court referred to above. We are of opinion that unless there are clear and compelling reasons, which cannot be denied, we should not depart from the interpretation given in these two cases and indeed from any interpretation given in an earlier judgment of this Court, unless there is a fair amount of unanimity that the earlier decisions are manifestly wrong. This Court should not, except when it is demonstrated beyond all reasonable doubt that its previous ruling, given after due deliberation and full hearing, was erroneous, go back upon its previous ruling, particularly on a constitutional issue. In this case our reconsideration of the matter has confirmed the view that there is no place for the introduction of the concept of the place where the impugned order has effect or of the concept of functioning of a Government, apart from the location of its of....
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.... which the cause of action, wholly or in part, arises for the exercise of such power, notwithstanding that the seat of such Government or authority or the residence of such person is not within those territories. (3) Where any party against whom an interim order, whether by way of injunction or stay or in any other manner, is made on, or in any proceedings relating to, a petition under clause (1), without - (a) furnishing to such party copies of such petition and all documents in support of the plea for such interim order; and (b) giving such party an opportunity of being heard, makes an application to the High Court for the vacation of such order and furnishes a copy of such application to the party in whose favour such order has been made or the counsel of such party, the High Court shall dispose of the application within a period of two weeks from the date on which it is received or from the date on which the copy of such application is so furnished, whichever is later, or where the High Court is closed on the last day of that period, before the expiry of the next day afterwards on which the High Court is open; and if the application is not so....
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....based its decision on the sole consideration that the complainant had filed the complaint at Shillong in the State of Meghalaya and the petitioner had prayed for quashing the said complaint. The High Court did not also consider the alternative prayer made in the writ petition that a writ of mandamus be issued to the State of Meghalaya to transfer the investigation to Mumbai Police. The High Court also did not take note of the averments in the writ petition that filing of the complaint at Shillong was a mala fide move on the part of the complainant to harass and pressurise the petitioners to reverse the transaction for transfer of shares. The relief sought in the writ petition may be one of the relevant criteria for consideration of the question but cannot be the sole consideration in the matter. On the averments made in the writ petition gist of which has been noted earlier it cannot be said that no part of the cause of action for filing the writ petition arose within the territorial jurisdiction of the Bombay High Court. ... 35. But a Constitution Bench of this Court has held in Election Commission, India v. Saka Venkata Subba Rao [(1953) 1 SCC 320 : AIR 1953 SC ....
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....icitly clarified the position post the amendment. The Court held that if even if a small fraction of the cause of action accrues within the jurisdiction of the Court, the Court will have jurisdiction in the matter. The relevant paragraphs of this decision are brought out hereunder:- "7. Clause (2) of Article 226 of the Constitution of India reads thus: "226. (2) The power conferred by clause (1) to issue directions, orders or writs to any Government, authority or person may also be exercised by any High Court exercising jurisdiction in relation to the territories within which the cause of action, wholly or in part, arises for the exercise of such power, notwithstanding that the seat of such Government or authority or the residence of such person is not within those territories." 8. Section 20(c) of the Code of Civil Procedure reads as under: "20. Other suits to be instituted where defendants reside or cause of action arises.-Subject to the limitations aforesaid, every suit shall be instituted in a court within the local limits of whose jurisdiction- (a)-(b)*** (c) the cause of action, wholly or in part, arises." 9. Alth....
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....f the person affected by the order but of the person or authority passing the order and the place where the order has effect. In the latter sense, namely, the office of the authority which is to implement the order would attract the territorial jurisdiction of the Court was considered having regard to Section 20(c) of the Code of Civil Procedure as Article 226 of the Constitution thence stood, stating: (AIR p. 540, para 16) "The concept of cause of action cannot in our opinion be introduced in Article 226, for by doing so we shall be doing away with the express provision contained therein which requires that the person or authority to whom the writ is to be issued should be resident in or located within the territories over which the High Court has jurisdiction. It is true that this may result in some inconvenience to persons residing far away from New Delhi who are aggrieved by some order of the Government of India as such, and that may be a reason for making a suitable constitutional amendment in Article 226. But the argument of inconvenience, in our opinion, cannot affect the plain language of Article 226, nor can the concept of the place of cause of action be introduce....
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....ion that the High Court can exercise power to issue direction, order or writs for the enforcement of any of the fundamental rights conferred by Part III of the Constitution or for any other purpose if the cause of action wholly or in part had arisen within the territories in relation to which it exercises jurisdiction notwithstanding that the seat of the Government or authority or the residence of the person against whom the direction, order or writ is issued is not within the said territories. (See ONGC v. Utpal Kumar Basu [(1994) 4 SCC 711].) 9. By "cause of action" it is meant every fact, which, if traversed, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the Court. In other words, a bundle of facts, which it is necessary for the plaintiff to prove in order to succeed in the suit. (See Bloom Dekor Ltd. v. Subhash Himatlal Desai [(1994) 6 SCC 322].)" (emphasis supplied) 25. The Supreme Court in Om Prakash Srivastava (supra) held that "cause of action" has to be construed as bundle of facts and that even a threat of infringement of a right by any person within the territorial jurisdiction of the Court would be a relev....
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....61 SC 532]. The Bench approved the aforementioned two Constitution Bench judgments and opined that unless there are clear and compelling reasons, which cannot be denied, writ court cannot exercise jurisdiction under Article 226 of the Constitution beyond its territorial jurisdiction. 9. The interpretation given by this Court in the aforesaid decisions resulted in undue hardship and inconvenience to the citizens to invoke writ jurisdiction. As a result, clause (1-A) was inserted in Article 226 by the Constitution (Fifteenth) Amendment Act, 1963 and subsequently renumbered as clause (2) by the Constitution (Forty-second) Amendment Act, 1976. The amended clause (2) now reads as under: "226.Power of High Courts to issue certain writs.- (1) Notwithstanding anything in Article 32, every High Court shall have power, throughout the territories in relation to which it exercises jurisdiction, to issue to any person or authority, including in appropriate cases any Government, within those territories, directions, orders or writs, including writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari, or any of them, for the enforcement of....
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....perused the facts pleaded in the writ petition and the documents relied upon by the appellant. Indisputably, the appellant reported sickness on account of various ailments including difficulty in breathing. He was referred to hospital. Consequently, he was signed off for further medical treatment. Finally, the respondent permanently declared the appellant unfit for sea service due to dilated cardiomyopathy (heart muscle disease). As a result, the Shipping Department of the Government of India issued an Order on 12-4-2011 cancelling the registration of the appellant as a seaman. A copy of the letter was sent to the appellant at his native place in Bihar where he was staying after he was found medically unfit. It further appears that the appellant sent a representation from his home in the State of Bihar to the respondent claiming disability compensation. The said representation was replied by the respondent, which was addressed to him on his home address in Gaya, Bihar rejecting his claim for disability compensation. It is further evident that when the appellant was signed off and declared medically unfit, he returned back to his home in the district of Gaya, Bihar and, thereafter, ....
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.... within the territories in relation to which this Court exercises jurisdiction. Though in different context, the question arose as to the place where the cause of action would arise, the question was considered by a Division Bench of which I was a member in W.W. Joshi v. State of B'bay [(1958) 61 Bom. L.R. 829.]. A civil servant was removed from service and the question arose as to where the cause of action to get quashed the order of removal from service arose, and it was held that the cause of action would arise at the place where the order of termination of service was made and also at the place where the consequences fell on the servant. In view of this decision, there can hardly be any doubt that the place where the consequences of the order fell on the petitioner would be a place where at least the cause of action in part would arise. No good ground is shown to us by Mr. Vaidya to differ from the view taken by the Division Bench in the aforesaid case. The second ground also should fail." (emphasis supplied) 30. In Wills India Insurance Brokers (P.) Ltd. V/S IRDA [(2012) 22 taxmann.com 154 (Bom)], this Court held that simply because the head office of the autho....
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....the land was recommended by the authority to the State Government. The notification acquiring the land was issued by the Rajasthan State Government. The petition challenging the acquisition proceedings and notification was filed in the Calcutta High Court and considering the facts of the case it was held that the petition before the Calcutta High Court was not maintainable. In the aforesaid case it was noted that the cause of action arose in Jaipur. As pointed out earlier, the land was situated at Jaipur. The notification was issued at Jaipur. Considering the aforesaid factual background, it was held that the Calcutta High Court had no jurisdiction to enter into the matter. In the instant case, as pointed out earlier, the first petitioner's registered office is located at Mumbai, it operates its business from Mumbai but since the office of first respondent is at Hyderabad that the renewal application was required to be preferred at Hyderabad. In our view, part of the cause of action can be said to have arisen within the territorial jurisdiction of this Court." (emphasis supplied) 31. More recently, in Teleperformance Global Services Pvt. Ltd. V/S ACIT [(2021) 435 ITR 725 ....
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.... on it at Mumbai. The Petitioner is an Assessee within the jurisdiction of the Tax Authorities at Mumbai. In this situation, in our opinion, certainly a part of the cause of action, in terms of clause (2) of Article 226 of the Constitution of India, has arisen within the territorial jurisdiction of this Court, which, in our opinion, entitles the Petitioner to approach this Court invoking its jurisdiction under Article 226 of the Constitution, with a grievance of breach of its legal and constitutional rights. The position of law in this context is also considered and discussed in the decision of this Court in Teleperformance Global Services (P) Ltd. (supra), which is aptly applicable to the case in hand. We are thus inclined to entertain this Petition, considering that a part cause of action has arisen within the territorial jurisdiction of this Court." (emphasis supplied) 33. Lastly, a reference is made to the decision of this Court dated in Vincent Commercial Company Limited V/S ITO [(2025) 307 Taxman 320 (Bombay)] where one of us (B. P. Colabawalla, J.) is a party. This was a case, where a company registered in Mumbai was issued notice under Section 148 of the Act, by....
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....has arisen within the territorial jurisdiction of this Court. If any cause of action has arisen outside its territorial jurisdiction, it would be only that the notice under Section 148 was issued by the Assessing Officer based in Kolkata and at the previous address of the Petitioner at Kolkata. Further, the learned advocate appearing on behalf of the Petitioner, on instructions, has stated before the Court that on the date when the notice under Section 148(A)(d) was issued to the Petitioner, the Petitioner did not have any office at the address mentioned in the said notice namely in Kolkata. Once these are the facts, we are clearly of the view that a substantial part of the cause of action has arisen within the territorial jurisdiction of this Court. 9. Once we have come to this conclusion, we find that Article 226(2) of the Constitution of India, clearly stipulates that the power to issue writs, orders, or directions to any Government, Authority, or person may be exercised by any High Court exercising jurisdiction in relation to the territory within which the cause of action, wholly or in part arises, for the exercise of such power, notwithstanding that the seat of such G....
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....of this Court. 36. In fact, the case of the Petitioner is on a better footing as compared to the other cases. In the present case, the Principal Commissioner of Income-tax, Delhi-1, vide order dated 13.12.2023 under Section 127 of the Act, has transferred the jurisdiction over the case to the DCIT/ACIT Circle-1(1), Pune. In this regard, reference can be made to the Explanation to Section 127 which clarifies the amplitude of "transfer of case" in relation to any person whose name is specified in the order of transfer. It reads thus:- "Explanation.- In section 120 and this section, the word "case", in relation to any person whose name is specified in any order or direction issued thereunder, means all proceedings under this Act in respect of any year which may be pending on the date of such order or direction or which may have been completed on or before such date, and includes also all proceedings under this Act which may be commenced after the date of such order or direction in respect of any year" 37. Thus, a transfer [under Section 127] implies that all proceedings under the Act in respect of any year which may be pending or which may have been completed or which i....
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....on of ABC Papers Limited (supra) to contend that an appeal under the Act is to be filed before the Tribunal/ Court within whose jurisdiction the Assessing Officer who passed the original order appealed against is located, and therefore, a similar analogy has to be drawn in context of a Writ Petition as well. This argument cannot be accepted as the provisions of section 260A of the Act are materially different from the provisions of Article 226(2) of the Constitution of India. Even the jurisdiction of the Court under Article 226(2) and under section 260A of the Act are quite different. The Court in ABC Papers Limited (supra) never had the occasion to interpret Article 226(2), the term "cause of action, wholly or in part" as appearing therein, and therefore, this decision would not have any bearing for interpreting Article 226 of the Constitution of India. 40. Thirdly, the reliance placed by the Revenue on the decision of this Court in case of Trustcap Private Limited (supra) is also misplaced. A perusal of that order shows that the Court relied on Lt. Col. Khajoor Singh (supra) without noticing that Khajoor Singh was rendered in the context of Article 226(1) prior to the amendmen....
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....leviate the inconvenience caused to the Petitioners by dragging them to the Court which exercises jurisdiction over the authority or the Respondent within the territorial jurisdiction of such Court. Reliance in this regard, on the decision of the Delhi High Court in case of Jayaswals Neco Ltd. (supra) is also, therefore, misplaced. 42. Accordingly, we reject the preliminary objection regarding territorial jurisdiction. We are of the considered view that at least part of the cause of action has arisen within the territorial jurisdiction of this Court, and therefore, we proceed to deal with the merits of the case. 43. The Petitioner's case on merits is that the demands of Rs. 3,28,785/- Rs. 1,24,577/- and Rs. 28,87,714/- are non-existent. The Petitioner has categorically stated that despite filing applications under the RTI Act and obtaining orders from the First Appellate Authority directing the Respondents to furnish the documents, no assessment orders or rectification orders giving rise to these demands have been provided. The Respondents have only furnished illegible screenshots of the computation sheets. 44. By the order dated 24.02.2025, this Court had specifically....
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....f order passed under Section 154 of the Act, it is petitioner's case, and which has not been controverted, that only the same computation sheet was provided but not an order. Even the screenshot of the order sent through email is illegible. 6. No affidavit in reply has been filed. Mr. Gupta appearing for respondents informed the Court that he has instructions from respondent No. 1- Mr. Basant Kumar Arya that the demand has been uploaded by the erstwhile Deputy Commissioner of Income Tax on the portal but the Department does not have any file relating to that matter. Mr. Gupta states that his instructions are to inform the Court that respondent No. 1 or the Department has no document to show that any notice was issued under Section 154 or even an order was passed under Section 154 of the Act. Mr. Gupta also states that if the Court directs respondents, they shall remove the pending demand from the Income Tax Portal pertaining to petitioner. 7. In view of the statement made by Mr. Gupta as recorded above, we have to quash and set aside the demand of Rs.46,84,750/- for Assessment Year 2013-2014 as appearing on petitioner's portal and the computation sheet under Secti....