Baywest Power And Energy Private Ltd v. Assistant Commissioner Of Income Tax Circle I (2)

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 12.03.2007 CORAM: THE HONOURABLE MR.JUSTICE P.D.DINAKARANandTHE HONOURABLE MRS.JUSTICE CHITRA VENKATARAMAN W.P.Nos.12760 and 12761 of 2004 Baywest Power and Energy Private Ltd.433, 9[th] Cross, 8[th] Main RoadII Stage, RMV Extension II, MIGBangalore-560 094represented by Mr.N.RamakrishnanGeneral Manager (Finance)..petitions .. Petitioner in both writversus Assistant Commissioner of Income TaxCircle I (2)121, Mahatma Gandhi RoadNungambakkamChennai-34. ..Respondent in both writ petitions ----- PRAYER: W.P.Nos.12760 and 12761 of 2004 are filed under Article 226 of theConstitution of India for the issue of a writ of Certiorari calling forthe records in PA/GIR.No.BX4-226/AAACB3113G dated 30.3.2004 relating tothe assessment year 1999-2000 and 2000-2001 respectively on the file ofthe respondent and to quash the same. For petitioner :Mr.V.RamachandranSenior Advocate forDr.Anita Sumanth For respondent :Mrs.Pushya SitaramanSenior Standing Counsel forIncome Tax (Order of the Court was made by CHITRA VENKATARAMAN,J.) These writ petitions are for the issue of a writ of certiorari toquash the orders of assessment for the years 1999-2000 and 2000-2001 dated30.3.2004, passed by the respondent, namely, the Assistant Commissioner ofIncome Tax Circle-I(2), Chennai. The assessee/petitioner herein is acompany. 2. In respect of the Assessment Years 1999-2000 and 2000-2001, it isstated that the assessee filed the returns under Section 139 of the IncomeTax Act, 1961. The allegation of the petitioner herein is that, afterissuing the intimation under Section 143(1) but without following theprocedure prescribed under Section 143(2), the respondent proceeded toissue notice under Section 148. The said reopening was objected to on theground of jurisdiction, apart from merits on the reopening. 3. It is stated that the petitioner had informed the respondent thatthey are registered in the state of Karnataka and having their registeredoffice in Bangalore. It is further stated that the respondent did not acton the original returns filed. It is further alleged that being lossreturns filed beyond due dates, they were not even valid in law. 4. The Chief Commissioner of Income Tax, Madras, by order No.1/96-97dated 3.6.1996, determined the jurisdiction as being confined to companiesregistered in Madras. It is alleged that the respondent ignored theobjection on the question of jurisdiction and finalised the assessmentunder Section 147. The petitioner states that the assessment made istotally without jurisdiction and violative of the provisions of the Actand the principles of natural justice. 5. It is further stated that assessment of companies having theirregistered office in the Union Territory of Pondicherry, but assessed bythe respondent herein ignoring the plea of want of jurisdiction, arechallenged before this Court in writ proceedings and the same are pending.In the above circumstances, the petitioner has preferred this writpetition. 6. Learned senior counsel appearing for the petitioner hereincontends that the Central Board of Direct Taxes determined the territorialjurisdiction for assessment in terms of Sections 120 to 124. The company,incorporated at Karnataka in Bangalore, could not be proceeded against bythe respondent herein. The petitioner also contended that the Officer hadmade the assessment based on certain statements alleged to have been madeby two officials, who, according to the petitioner, were not employees ofthe petitioner. Consequently, the proceedings passed without furnishing the copy of those statements, were totally in violation of theprovisions of the Act. Considering the fact that the petitioner is acompany registered in Bangalore, the respondent totally lacked injurisdiction. Learned senior counsel pleaded that on the question of wantof jurisdiction itself, the orders are liable to be quashed. furnishing the copy of those statements, were totally in violation of theprovisions of the Act. Considering the fact that the petitioner is acompany registered in Bangalore, the respondent totally lacked injurisdiction. Learned senior counsel pleaded that on the question of wantof jurisdiction itself, the orders are liable to be quashed. 7. A perusal of the writ affidavit clearly shows that the petitionerhas admitted about the existence of an effective alternative remedyavailable under the provisions of the Act against the order of re-assessment. It is not denied by the learned senior counsel that thequestion of jurisdiction, apart from merits, can be raised forconsideration before the appropriate appellate forum. 8. Mr.V.Ramachandran, learned senior counsel appearing for thepetitioner, however, submitted that considering the total lack ofjurisdiction to assess this petitioner under Section 148, the writpetition filed merited consideration by this Court. He also referred tothe orders passed by this Court in other writ petitions and prayed forinterference. 9. The Revenue has filed its counter affidavit. 10. Learned standing counsel appearing for the respondent, however,submitted that considering the admitted position that an efficaciousremedy is available to the assessee by way of an appeal to theCommissioner of Income Tax (Appeals), the writ petitions are notmaintainable. She further pointed out that the notice under Section 148was issued to the petitioner on 1.4.2002. the petitioner submitted aletter on 25.2.2002 stating that they wanted to inspect certain documentsand promised to file a detailed reply. On 4.9.2002 and 21.8.2002, thepetitioner filed letters authorising Shri.K.V.Rangnathan & Co., CharteredAccountants, to represent their case. They expressed their cooperation tocomplete the assessment proceedings. Thereafter, a detailed letter,enclosing a copy of the letter dated 15.5.2002, was sent to the petitioneron 9.2.2004. However, there was no response. The assessment wascompleted under Section 144. The petitioner is one among the Groupconcerns against whom proceedings were initiated under Section 148. Allthe Group companies claimed benefits under Section 80-I. They all havefiled their returns at Chennai, giving local address. It is also statedthat the petitioner did not file any return in response to the noticeunder Section 148. The assessment was completed on the basis of materialavailable on record. In spite of adequate opportunity granted, thepetitioner had not availed of the same to defend its cause. Learnedstanding counsel submitted that the contentions that are taken here canequally be taken before the statutory authorities and there are noextraordinary circumstances in this case for the Court to exercisejurisdiction under Article 226 of the Constitution of India. 11. We agree with the submissions made by the learned standingcounsel appearing for the respondent herein. A perusal of the ordersimpugned herein show that the issues raised in the writ petitions weretaken before the respondent too, who had passed the orders afterconsidering the same. Since the issue involved in the writ petitionsrequired investigation into the facts, including the issue onjurisdiction, we do not find any extraordinary circumstance to go into themerits. It is a matter for the statutory authorities to consider if andwhen an appeal is preferred. 11. We agree with the submissions made by the learned standingcounsel appearing for the respondent herein. A perusal of the ordersimpugned herein show that the issues raised in the writ petitions weretaken before the respondent too, who had passed the orders afterconsidering the same. Since the issue involved in the writ petitionsrequired investigation into the facts, including the issue onjurisdiction, we do not find any extraordinary circumstance to go into themerits. It is a matter for the statutory authorities to consider if andwhen an appeal is preferred. 12. Admittedly, the assessee has an alternative remedy, and it is notdenied that it is an efficacious remedy. In a recent decision reported in279 ITR 342 (DR.K.NEDUNCHEZHIAN Vs. DEPUTY CIT), a Division Bench of thisCourt, affirmed the decision reported in 274 ITR 37 (DR.K.NEDUNCHEZHIANVs. DEPUTY CIT) and following the decision of the Apex Court, held thatwhen there is an alternative remedy, ordinarily, writ jurisdiction underArticle 226 of the Constitution of India should not be invoked and thatthe principle applies with greater force to this proceedings. 13. Considering the issues involved and applying the decision citedabove, we dismiss the writ petitions. It is open to theassessee/petitioner to prefer appeal, if they deem fit, within a period ofthirty days from the date of receipt of a copy of this order. No costs.Consequently, the connected M.P.Nos.14866 and 14867 of 2004 andW.V.M.P.No.572 of 2005 are closed. ksv Sd/Asst. Registrar/true copy/Sub Asst.Registrar To: 1.The Assistant Commissioner of Income TaxCircle I (2)121, Mahatma Gandhi RoadNungambakkamChennai-34. + One cc to Dr. Anita Sumanth Advocate sR 15289+ One cc to Mrs. Pusya Sitaraman Advocate sR 15299MM (co)sg 2/4/07W.P.Nos.12760 and 12761 of 2004 Dated: 12.03.2007