Case Of Gkn Driveshafts (India) Ltd v. Dcit(2003) 259 Itr (19) Sc

- |] - IN THE HIGH COURT OF KARNATAKA AT BENGALURU| DATED THIS THE 9 DAY OF SKPIEMBER 2019 BEKORE, THR HON’BLE MR.JUSTICE P. B. BAJANTHRI WRITPETITIONNO~159'7OF2019(T;IT) BBREITW M/S. EPSON INDIA PRIVATE LIMITED,|12 FLOOR, “THE MILLENIA’ TOWER A,NO.1, MURPHY ROAD, ULSOOR,BRENGALURU-560 OOS.(REPRESENTED BY ITS SENIOR VIDE PRESIDENTSRI. MR. T. SUKUMAR,9/O. SRI. THIRUNAVUKKARASU,AGED ABOUT 58 YEARS) ..PRTITTIONER | (BY SRI. CHYTHANYA K. K., ADVOCATE) AND 1.|THE ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE -2(1)(2),.CIRCLE -2(1)(2),. ROOM NO.218, 2 FLOOR, BMTC BUILDING, 80 FT. ROAD, KORAMANGALA, BENGALURU-560 O95. D2 THE ASSISTANT COMMISSIONER OF INCOME TAX,TRANSFER PRICING -1(2)(1),TRANSFER PRICING -1(2)(1), ROOM NO.329, 3 FLOOR, BMTC BUILDING, 80 FT. ROAD,KORAMANGALA,BENGALURU-560 O95. |KORAMANGALA,BENGALURU-560 O95. | ... RESPONDENTS (BY SRI. E. Il. SANMATHI, ADVOCATE FORSRI. JEEVAN J. NEERALGI, ADVOCATE)SRI. JEEVAN J. NEERALGI, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND22 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH A58sFAR AS THE PBRITTTIONER IS CONCKRNED THRE [MPUGNNOTICE ISSUED BY THR R-1 UNDER SECTION 148 OF THER [TACT, DATED 15.09.2017, ENCLOSED AS ANNEXURE-A. — THIS WRIT PRTITION IS COMING ON FORPRALIMINA RYHEARING IN ‘B’ GROUP,|THIS DAY, THE COURT MADE THEFOLLOWING: ORDER In the instant petition, petitioner has sought for the following reliefs: a)Quash as far as the petitioner is concerned|by an appropriate writ or order in the natureof certiorart or otherwise, the impugnednotice bearing No.ITBA/AST/S/ 148/201 18/ 1006343705(1)issued.bythefirstrespondent under Section 148 of the IT act,|dated 15.09.2017, enclosed as Annexure-A;by an appropriate writ or order in the natureof certiorart or otherwise, the impugnednotice bearing No.ITBA/AST/S/ 148/201 18/ 1006343705(1)issued.bythefirstrespondent under Section 148 of the IT act,|dated 15.09.2017, enclosed as Annexure-A;b)Quash as far as the petitioner is concerned|by an appropriate writ or order in the natureof certiorart or otherwise, the impugnednotice bearing No.AACE7858F/ACIT-C2(1)(2)/ 143(2)/ 2018-1issuedbythefirstrespondent under Section 143(2), dated05.09.2018, enclosed as Annexure-B;by an appropriate writ or order in the natureof certiorart or otherwise, the impugnednotice bearing No.AACE7858F/ACIT-C2(1)(2)/ 143(2)/ 2018-1issuedbythefirstrespondent under Section 143(2), dated05.09.2018, enclosed as Annexure-B; c}Quash as far as the petitioner is concernedby an appropriate writ or order in the natureof certiorari or otherwise, the impugned orderoverrulingobjectionbearingF.No. 148,AAACE7858F/ DCIT-C-2(1)(2)/ 2018-1passed by the first respondent enclosed asAnnexure-C;by an appropriate writ or order in the natureof certiorari or otherwise, the impugned orderoverrulingobjectionbearingF.No. 148,AAACE7858F/ DCIT-C-2(1)(2)/ 2018-1passed by the first respondent enclosed asAnnexure-C; - 3 -] d)Quash as far as the petitioner is concerned|by an appropriate writ or order in the natureof certiorart or otherwise, the impugnednoticebearingF’.No./ TPO-1(1)(2)/ 2018-issued by the second respondent underSection 92CA, dated 23.10.2018, enclosed|as Annexure-D.by an appropriate writ or order in the natureof certiorart or otherwise, the impugnednoticebearingF’.No./ TPO-1(1)(2)/ 2018-issued by the second respondent underSection 92CA, dated 23.10.2018, enclosed|as Annexure-D. 2. Annexures ‘A’ to ‘D’ are notices issued undersection 148 and 143(2) of Income Tax Act, 1961.Annexure-C is stated to have been the overruling|objections of the petitioner and Annexure-D relates to|issuance of notice under Section QOVJCA. On a bareperusal of the impugned notices read with Annexure-C,it is crystal clear that it is not a final re-assessment|order. Certain procedures have been adopted by the|Deputy Commissioner, Income Tax. Paragraphs 3 and|4 of Annexure-C dated 28.02.2019, reads as under: 2. Annexures ‘A’ to ‘D’ are notices issued undersection 148 and 143(2) of Income Tax Act, 1961.Annexure-C is stated to have been the overruling|objections of the petitioner and Annexure-D relates to|issuance of notice under Section QOVJCA. On a bareperusal of the impugned notices read with Annexure-C,it is crystal clear that it is not a final re-assessment|order. Certain procedures have been adopted by the|Deputy Commissioner, Income Tax. Paragraphs 3 and|4 of Annexure-C dated 28.02.2019, reads as under: “3. Accordingly, the undersigned is of theconsidered opinionthatthereis relevantmaterial for forming a reasonable belief thatincome has escaped assessment and, therefore,the initiation of reassessment proceedings byissue of notice under Section 148 of the Act is inorder.Thiscommunicationshouldbe|considered as speaking order as per thedirections of the Hon’ble Supreme Court in the - 4 -| case of GKN Driveshafts (India) Ltd. Vs. DCIT(2003) 259 ITR (19) SC. 4.DuringtheCOUTSeCofreassessment|proceedings you will be afforded adequateopportunity to explain your case and theresultant order will be passed on an objectiveappraisal of the evidences available.” 3. The learned counsel for petitioner submittedthat time and again courts have held that if reasons tobelieve with reference to materials are not available, the|same amounts to without jurisdiction. The petitioner|has not pointed out that the very statutory provision donot empower the Deputy Commissioner of Income Tax|to proceed with, so as to contend that he has no|jurisdiction to interfere with the issuance of show-causenotices. Supreme Court in number of cases has|examined under what circumstances a show-cause|noticecouldbe.interfered.Therefore,Writ1Smaintainable. The definition of ‘jurisdiction’ as defined|in the judicial dictionary is as under: @Jurisdiction_ means the legal authority toadminister justice according to the means, thelaw has provided subject to the limitationimposed by the law upon the judicial authority.A Government’s general power to exerciseauthority over all persons and things within itsterritory; esp. a State’s power to create intereststhat will be recognized under common-lawprinciples as valid in other states. A court’spower to decide a case to issue a decree; theconstitutionalgrantoffederal-questionjurisdiction.” 4Judgmentdeliveredby|aCourt“notcompetent” to deliver it is void — Distinction between|total want of jurisdiction and erroneous exercise ofjurisdiction . — It is a fundamental principle well|established that a decree passed by a Court withoutjurisdiction is a nullity, and that invalidity could be set|up whenever and by whoever it is sought to be enforced|or relied upon even at the stage of execution and even in|collateral proceedings. A defect of jurisdiction, whether|it is pecuniary or territorial, or whether it is in respect ofthe subject matter of the action, strikes at the very authority of the Court to pass any decree and such a|defect cannot be cured even by consent of parties. 5The words “not competent’ in Section 44 ofEvidenceActreterTO|aCourtacting without.jurisdiction. The section refers to the lack of inherent|jurisdiction in the Court and not to its territorial|jurisdiction. In Article 46 of Sir James Stephen’s Digest|of the Law of Evidence, the corresponding rule of|English law is stated to be that whenever a judgment isoffered as evidence, the party against whom it is so|offered may prove that the Court which gave it had no|jurisdiction. The “competency of a Court and its|“jurisdiction” are thus synonymous terms. A judgment|or decree passed without jurisdiction is a nullity; and|when a decree is void and a nullity, it is the duty not|only of the Court which passed it to ignore it but of|every Court to which it is presented. There must,| however, be a manifest lack of jurisdiction in the Court|to render its decree or judgment void.| however, be a manifest lack of jurisdiction in the Court|to render its decree or judgment void.| 6.Jurisdiction may be defined to be power of a|Court to hear and determine a cause, to adjudicate or exercise any judicial power in relation to it. Such|jurisdiction naturally divides itself under three broad|heads, namely, with reference to: '3(the subject- matter '33(the parties, and '333(the particular question which calls fordecision.decision. ToQuestion of jurisdiction may consequentlyarise in one of three ways, that is, either in relation tothe subject-matter, or in relation to the parties, or in|relation to the question submitted for the decision of theCourt. This classification into territorial jurisdiction,|pecuniary jurisdiction and jurisdiction of the subject-matter is obviously of a fundamental character. Given| - 8 -| such jurisdiction, we must be careful to distinguish|exercise of jurisdiction from existence of jurisdiction, for|fundamentally different are the consequences of failure|TO complywith statutoryrequirementsintheassumption and in the exercise ofjurisdiction. oO.The authority to decide a cause at all, and.not the decision rendered therein, is what makes up|jurisdiction, and when there is jurisdiction of the personand subject-matter, the decision of all other questions|arising in the case is but an exercise of that jurisdiction.The distinction between cases where jurisdiction is|assumed by a Court where there is a absolute want of itand those where the Court in the exercise of its/jurisdiction acts wrongly is of fundamental importance.In the former case the decision is void and a nullity,|whereas in the latter case it is merely voidable, and has|due effect, unless set aside by appropriate proceedings.It cannot be said that wherever a decision is wrong in| law or violates a rule of procedure, the Court must be|held incompetent to deliver it. It has never been and_|could not be held that a Court which erroneously|decreed a suit which it should have dismissed as time|barred or as barred by the rule ofres judicataactswithout jurisdiction and is not competent to deliver its|decree. Even the concept of pending proceedings is)taken into consideration under act, 1999 or Act, 2003|do not provide for transfer of pending proceedings like|arbitration proceedingswhichWaspending0.8.2004 like a provision in the Administration Tribunal|Act, 1985, where Government employees litigations were pendingbeforeHighCourtWETEtransferredTO—respective Administrative Tribunals as and when)Tribunal was constituted. till 9. In the present petition, it is not that DeputyCommission’s action is without authority of law to)contend he has no jurisdiction to issue notices. Therefore, petition is premature for the reason that the|Deputy Commissioner of Income Tax has specifically|stated that the petitioner would be afforded adequate|opportunity to explain his case before passing order on objective appraisal of the evidence available. The)learned counsel for petitioner contends that the|petitioner’s objections stated in para-21.2 of his petitionhas not been considered before issuing the impugned|communication dated 28.02.2019. The learned counsel]|for petitioner submitted that it is an order. Perusal of|the last portion of the communication shows that the|petitioner’s right has not been affected. What has been|stated is that the petitioner would be afforded adequate|opportunity to explain his case. Therefore, one has to|draw an inference that it is not an order and it is only a|communication wherein it is specifically stated that|during the course of reassessment proceedings, the|petitioner has an opportunity to explain his version.The contention of the petitioner that objections stated in para-21.2 have not been appraised by the concerned|authority. If it is not considered, it is an advantage to|the petitioner in future to take the contention that his|srievance/objections have not been addressed, which|would be non-application of mind, and on that ground|itself further proceedings will be treated as void. In|other words,thepresentpetition1Spremature.Accordingly, the writ petition stands dismissed as|premature reserving liberty to the petitioner to pursue|the Deputy Commissioner of Income Tax in terms of|Annexure-C and appraise all his contentions. In the|event of making a detail explanation along with the|documents before the Deputy Commissioner of Income|Tax pursuant to the communication dated 28.02.2019,the Deputy Commissioner of Income Tax, Bengaluru is hereby directed to consider each and every contention tobe raised by the petitioner and pass speaking order after|due consideration of each contention, in accordance|with law. ��� ������� ������203037/�34�5??78@3/:<E�@34A3442@�� ����� �����