Estra Enterprises Pvt. Ltd.,6[Th] Floor Tower C, Tek Meadows v. Additional/Joint/Deputy/Assistant Commissioner Of Income Tax/ Income-Tax Officer,National Faceless Assessment Centre,Delhi

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 26.08.2021 CORAM THE HON'BLE Mr.JUSTICE M.SUNDARW.P.No.17709 of 2021andWMP.Nos.18874 & 18875 of 2021 Estra Enterprises Pvt. Ltd.,6[th] Floor Tower C, Tek Meadows,No.51, Rajiv Gandhi Salai,Sholinganallur, Chennai-600 119.Represented by Authorized SignatoryMr.R.Suresh Kumar ...Petitioner -Vs.- 1.Additional/Joint/Deputy/Assistant Commissioner of Income Tax/ Income-Tax Officer,National Faceless Assessment Centre,Delhi. 2.National Faceless Assessment Centre, Income Tax Department,Ministry of Finance,Government of India,Delhi. ...RespondentsPrayer:- Writ Petition filed under Article 226 of theConstitution of India praying to issue a Writ of Certiorari,calling for the records of the First Respondent in Assessmentorder dated 06.08.2021 bearing Identification No.ITBA / AST / S/143 (3) / 2021-22 / 1034696402 (1) and consequential DemandNoticedated06.08.2021bearingIdentificationNo.ITBA/AST/S/156/2021-22/1034696486(1)passedagainstthepetitioner quash the same. For Petitioner : Mr.Arvind P DatarSenior Counselfor Mr.M.V.SwaroopFor Respondents : Ms.Hema MuralikrishnanSenior Standing Counsel O R D E R Captioned writ petition and 'Writ Miscellaneous Petitions'['WMPs' in plural and 'WMP' in singular for the sake of brevityand convenience] are listed in the admission Board before mei.e., in the Motion List under the cause list caption 'FORADMISSION'. 2. Mr.Arvind P Datar, learned Senior Advocate instructed bylearned counsel Mr.M.V.Swaroop, counsel on record for writpetitioner is before this virtual Court. 3. Ms.Hema Muralikrishnan, learned Senior Standing counsel[Revenue counsel for the sake of convenience] accepted notice onbehalf of both the respondents. 4. Owing to the narrow compass on which captioned writpetition turns, with the consent of learned counsel on bothsides, main writ petition is taken up. 5. An 'Assessment order dated 06.08.2021 bearing referenceITBA/AST/S/143(3)/2021-22/1034696402(1)' [hereinafter 'impugnedorder' for the sake of convenience and clarity] has been calledin question in the captioned writ petition, where the prayer isone for Certiorari. 6. Impugned order has been made under Section 143(3) of 'TheIncome Tax Act, 1961' [hereinafter 'IT Act' for the sake ofbrevity] read with 144B of IT Act. To be noted, Section 144B ofIT Act kicked in on 01.04.2021. 7. Short point turns on Section 144B(1)(xvi)(b) read with144B (7)(vii) as a 'Show Cause Notice dated 20.07.2021'[hereinafter 'first SCN' for the sake of brevity] was issuedcalling upon writ petitioner-assessee's response by 59 minutespost 23.00 hours on 26.07.2021, writ petitioner-assesseeresponded on 25.07.2021 requesting for two weeks time owing tovoluminous records that have to be uploaded. Thereafter another'Show Cause Notice dated 03.08.2021' [hereinafter 'second SCN'for the sake of brevity and clarity] came to be issued and writpetitioner-assessee responded to the same by uploading hisresponse which included voluminous documents. To be noted, allthis is borne out by records and there is no disputation ordisagreement in this regard. Further to be noted, writpetitioner-assessee vide reply to second SCN had requested for apersonal hearing also. Writ petitioner-assessee had alsoreferred to the restriction qua number of attachments and soughtpermission to upload the response in tranches. Forillustration, a typical screen shot from the official website isas follows: 8. This Court considers it unnecessary to burden this orderwith further details in this regard as it is abundantly clearthat the writ petitioner-assessee has responded to the SCN andit also sought for a personal hearing. To be noted, there is nodisputation or disagreement in this regard as alluded to supra. 8. This Court considers it unnecessary to burden this orderwith further details in this regard as it is abundantly clearthat the writ petitioner-assessee has responded to the SCN andit also sought for a personal hearing. To be noted, there is nodisputation or disagreement in this regard as alluded to supra. 9. Learned Senior counsel, thereafter, adverting to/takingthis Court through the impugned order and more particularlyparagraph 11 thereat, pointed out that the impugned orderproceeds on the basis that neither a reply has been filed nor anadjournment has been sought. Paragraph 11 of the impugned orderreads as follows: '11. In view of the above for making things morerational and meeting out the parameters of naturaljustice a draft assessment order elaborating each itemof addition was issued on 20.07.2021. Date fixed forcompliance was 26.07.2021. On the fixed date, neitherany reply was submitted nor was any adjournment soughtby the assessee. Again show cause notice dated03.08.2021 along with Draft assessment order andcomputation sheet were issued to the assessee. Datefixed for compliance 05.08.2021. On the date fixed,neither any reply nor any adjournment was sought bythe assessee. It shows that assessee has no validexplanation regarding additions proposed vide showcause notices dated 20.07.2021 and 03.08.2021accordingly. On the basis of the show cause noticesaddition discussed in para 04 to 10 are being made.' (underlining made by this Court for ease of reference) 10. The above is clearly contrary to the undisputed factscenario. 11. Be that as it may, it is submitted by learned SeniorCounsel that above manifests itself as one of the facets of'Natural Justice Principles' and that facet is notconsidering the reply that has been sent by the writ petitioner-assessee. To buttress this submission, learned Senior counselpressed into service Tin Box Company case being Tin Box Company,New Delhi Vs. Commissioner of Income Tax, New Delhi reported in2001 9 SCC 725, which is also reported in (2001) 249 ITR 216 SC.This will be alluded to elsewhere infra in this order. 12. Learned Revenue counsel, who accepted notice on behalfof the respondents made three submissions and they are asfollows: a) the question as to whether impugned assessment ordershould be under Section 144B, which kicked in on and from01.04.2021 or under Section 143A (as it was, prior to01.04.2021) may please be left open; b) there is a statutory appeal available for the writpetitioner under Section 246A of IT Act. c) Personal hearing is not there for the asking andit is at the discretion of Chief Commissioner or theDirector General in-charge of Original FacelessAssessment Centre. In support of this contention,learned Revenue counsel drew the attention of this Courtto Section 144B (7)(viii). 13. I now embark upon the exercise of considering the rivalsubmissions, discussing the same and giving my dispositivereasoning for disposal of captioned writ petition. 14. With regard to the first submission of the Revenuecounsel i.e., leaving open the question qua Section 144B/143(3A), the request is acceded to as the same is neither relevantnor imperative to clinch the bone of contention in the case onhand. c) Personal hearing is not there for the asking andit is at the discretion of Chief Commissioner or theDirector General in-charge of Original FacelessAssessment Centre. In support of this contention,learned Revenue counsel drew the attention of this Courtto Section 144B (7)(viii). 13. I now embark upon the exercise of considering the rivalsubmissions, discussing the same and giving my dispositivereasoning for disposal of captioned writ petition. 14. With regard to the first submission of the Revenuecounsel i.e., leaving open the question qua Section 144B/143(3A), the request is acceded to as the same is neither relevantnor imperative to clinch the bone of contention in the case onhand. 15. The second point turns on the statutory appeal provisionunder Section 246A. I have repeatedly held that alternateremedy qua writ Court is a self-imposed restraint and it is notan absolute Rule. I have also repeatedly held that it has to beapplied strictly in fiscal law Statute by respectfully followingratios of Hon'ble Supreme Court in a longline of authoritiesstarting from (i) Assistant Collector of Central Excise, ChandanNagar, West Bengal Vs. Dunlop India Ltd., and others reported in(1985) 1 SCC 260, (ii) United Bank of India Vs. Satyawati Tondonand others reported in (2010) 8 SCC 110 and (iii) AuthorizedOfficer, State Bank of Travancore and another Vs. Mathew K.C.reported in (2018) 3 SCC 85. In this case, the point is whetherit falls under any one of the exceptions to the alternate remedyrestraint. The exceptions to the self imposed restraint havebeen adumbrated in Whirlpool Corporation Vs. Registrar of TradeMarks, Mumbai and others reported in (1998) 8 SCC 1 and the samewas reiterated by Hon'ble Supreme Court in Harbanslal Sahnia andanother Vs. Indian Oil Corporation Ltd., and others reported in(2003) 2 SCC 107. 16. Without entering upon elaboration qua adumbration ofexceptions, it will suffice to say that a clear and indisputableviolation of NJP is a certain exception to the Rule and the case https://hcservices.ecourts.gov.in/hcservices/ on hand directly and squarely fits into this exception owing tothe narrative set out thus far. In this regard, as alreadyalluded to, Tin Box Company case law becomes relevant it comesto the aid of the writ petitioner in the case on hand owing tothe factual matrix and the most relevant paragraph in Tin Boxcase law is paragraph 2, which reads as follows: '2.That the assessee could have placed evidencebefore the first appellate authority or before theTribunal is really of no consequence for it is theassessment order that counts. That order must be madeafter the assessee has been given a reasonableopportunity of setting out his case. We, therefore,do not agree with the Tribunal and the High Court thatit was not necessary to set aside the order ofassessment and remand the matter to the assessingauthority for fresh assessment after giving to theassessee a proper opportunity of being heard.' 17. The above buttresses the principle that in a given caseof indisputable NJP violation i.e., aforementioned facet of NJP,availability of statutory appeal argument pales intoinsignificance. 18. With regard to the third point which turns on Section144B(7)(viii), this Court refrains itself from expressing anyopinion on the same at this point of time as I only propose torelegate the matter for assessment afresh after considering thewrit petitioner-assessee's response, which has not been done quathe impugned order. Therefore, when the response of writpetitioner-assessee is considered, it will include consideringthe writ petitioner-assessee's request for a personal hearing.This much clarity will suffice and any further elaboration wouldbe unnecessary as that would only burden this order withparticulars that are not imperative for appreciating this order. 18. With regard to the third point which turns on Section144B(7)(viii), this Court refrains itself from expressing anyopinion on the same at this point of time as I only propose torelegate the matter for assessment afresh after considering thewrit petitioner-assessee's response, which has not been done quathe impugned order. Therefore, when the response of writpetitioner-assessee is considered, it will include consideringthe writ petitioner-assessee's request for a personal hearing.This much clarity will suffice and any further elaboration wouldbe unnecessary as that would only burden this order withparticulars that are not imperative for appreciating this order. 19. In the light of the narrative discussion and dispositivereasoning set out thus far, the following order is passed: a) Impugned Assessment order dated 06.08.2021bearing reference ITBA/AST/S/143(3)/2021-22/1034696402(1) is set aside solely on the ground of non adherenceto statutorily ingrained NJP principle; b) A sequittur to the previous directive (thoughobvious) is, this Court has not expressed any opinion orview on the merits of the matter leaving open all thequestions to be decided by Assessing Authority in the denovo exercise; c) De nova assessment exercise shall be commencedby 01.09.2021 and completed as expeditiously as thebusiness of the assessment mechanism would permit and inany event within eight(8) weeks from 01.09.2021 i.e., onor before 27.10.2021. 20. Captioned writ petition is disposed of with the abovedirectives. There shall be no order as to costs. Consequently,connected WMPs are also disposed of as closed. Sd/- Assistant Registrar //True Copy// kmi Sub Assistant Registrar To 1.Additional/Joint/Deputy/Assistant Commissioner of Income Tax/ Income-Tax Officer,National Faceless Assessment Centre, Delhi. 2.National Faceless Assessment Centre,Income Tax Department,Ministry of Finance,Government of India, Delhi. +1cc to M/s.Hema Muralikrishnan, Advocate, S.R.No.43245 W.P.No.17709 of 2021 andWMP.Nos.18874 & 18875 of 2021 SSV[co]NSK 17/09/2021