Ppn Power Generating Company Pvt. Ltd v. The Assistant Commissioner Of Income Tax,Central Circle-3(1) Chennai,Room

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 28.07.2021 CORAM: THE HONOURABLE MR.JUSTICE S.M.SUBRAMANIAM W.P.Nos.15465 & 15467 of 2021and W.M.P.Nos.16398 & 16400 of 2021 PPN Power Generating Company Pvt. Ltd.,Represented by its Joint Managing Director,Mr.Harshad Reddy,1-A, III Floor, Jhaver Plaza,Nungambakkam High Road,Chennai 600 034...Petitioner in both W.Ps. Vs. The Assistant Commissioner of Income Tax,Central Circle-3(1) Chennai,Room No.316, New No.46,Mahatma Gandhi Road,Chennai 600 034...Respondent in both W.Ps. Common Prayer: Writ Petitions filed under Article 226 of theConsitution of India, to issue a Writ of Certiorari, calling forthe records and quash the assessment order bearing DINITBA/AST/M/147/2021-22/1033632435 (1) dated 23.06.2021 and DINITBA/AST/M/147/2021-22/1033659609(1) dated 24.06.2021, passed bythe respondent respectively. For Respondent : Mr.A.P.Srinivas (Senior Standing Counsel for IT) The lis on hand is to assail the orders of assessment dated23.06.2021 and 24.06.2021, passed by the respondent. The ordersof assessment impugned were passed under Section 143 (3) r/wSection 147 of the Income Tax Act, 1961 (hereinafter, referredto as, 'the Act'). https://hcservices.ecourts.gov.in/hcservices/ 2.It is not in dispute that the original orders ofassessment are appealable, under the provisions of the Act. 3.At the admission stage, when this Court raised anobjection regarding the entertainability of the Writ Petition,as the petitioner has to exhaust the appellate remedy, ascontemplated under the Act, the learned Senior Counsel appearingon behalf of the petitioner would submit that it is a case wherethe impugned orders of assessment were passed in violation ofprinciples of natural justice and the authority who passed theimpugned orders of assessment lacks jurisdiction and further,the mandatory requirements as contemplated under proviso toSection 147 of the Act has not been adhered to. 4.To substantiate the said contention, the learned SeniorCounsel drawn the attention of this Court regarding the noticeissued under Section 148 of the Act in proceedings dated25.02.2010. Though the notice was issued on 25.02.2010, it wasreceived by the petitioner on 08.09.2010. There was a delay ofabout 7 months even to serve Section 148 notice. Thus, a factualinference is to be drawn that the notice was not served withinthe period of limitation and the Courts have held that serviceof notice also to be taken into account for the purpose ofdeciding the point of limitation. The reasons furnished forreopening of assessment was communicated in proceedings dated16.09.2010, which reveals that “it is noticed that provisionsfor anticipated contract losses of Rs.10835 Lakhs to be addedback in computing the book profit u/s 116 JB as the same is onlyprovision and not an ascertained liability”. The petitionerassessee submitted their objections and thereafter, thepetitioner filed W.P.Nos.989 of 2011, challenging the initiationof reopening of assessment under Section 147/148 of the Act andconsequential proceedings initiated. This Court passed as under:“4.With the above observations, the WritPetitions stand closed with liberty to thepetitioner either to file their returns or seekfor reasons, if not already given. Such anexercise of raising their objections shall be donewithin a period of four weeks from the date ofreceipt of a copy of this order. In case, suchobjections are filed before the assessing officer,the same shall be considered in accordance withlaw and reasoned speaking orders shall be passed,as expeditiously as possible. In case, any of theassessees had already filed their objections, thesame shall also be considered within the saidperiod of four weeks, from the date of receipt ofa copy of the order. No costs. Consequently,connected Miscellaneous Petitions are closed.” 5.Thereafter, the petitioner, vide letter dated 02.11.2020,stated that the notice under Section 148 of the Act was issuedafter an expiry of four years from the date of assessment andtherefore, with reference to Paragraph No.4 at page No.5 of theorder of this Court dated 19.07.2019 in W.P.No.989 of 2011,actions are to be initiated. The objections submitted by thepetitioner were considered and disposed of by the assessingauthority in proceedings dated 23.12.2020 and 22.12.2020respectively. Detailed orders have been passed. Subsequently, arequest for rectification of mistake apparent in the orders ofdisposing the objections were filed by the petitioner on11.01.2021. The said applications of request for rectificationof mistake were also considered and disposed of by the assessingauthority in proceedings dated 01.03.2021. Thereafter, thepetitioner has stated that they were unable to file returnselectronically. Further, submitted a letter on 18.06.2021. Theauthority has further passed an order and finally, orders ofassessment were passed under Section 143 (3) r/w Section 147 ofthe Act, which are impugned in the present Writ Petitions. 6.The learned Senior Counsel strenuously contended that itis a case which required an elaborate adjudication. There is aviolation of principles of natural justice. The opportunity, ascontemplated, were not granted to the petitioner. The authoritywas lacking in jurisdiction. Therefore, the Writ Petitions areto be admitted and the original files are to be called for, forthe purpose of scrutinization. 7.In support of the contentions, the learned Senior Counselrelied on the judgment in the case of International FlavoursFragrances India Pvt. Ltd., vs. Joint Commissioner (LTU) andothers, reported in [2020] 429 ITR 28 (Mad), wherein, the Courtmade the following observations: “8.Proceedings for re-assessment initiatedbeyond four years from the end of the relevantassessment year have to satisfy the addedcondition set out in the proviso to Section 147 ofthe Act. Normally, the time limit for initiationof re- assessment is four years from the end ofthe subject assessment year with an extendedperiod of two years provided to the Departmentconditional upon the Department establishing thatthe alleged escapement of income was attributableto the failure of the assessee to file a return orto make a full and true disclosure of its incomefor the relevant period. ................ 12.A perusal of the reasons extractedelsewhere in this order only referred to the issueof classification of royalty on merits and nowhere it is stated that there has been any failure bythe petitioner in making a disclosure in thisregard. To be fair to the Assessing Officer, hedoes not even make such allegation in the reasonsfor re-assessment and rightly so, since thematerial available would show a full disclosure bythe petitioner at all stages of assessment.Thus I am of the view that the impugned orderdated 26.08.2019 rejecting the objections toassumption of jurisdiction is liable to be quashedand I do so.” 8.In the case of M/s.Kone Elevators (India) Pvt. Limited,Vs. Assistant Commissioner of Income-Tax, this Court passed theorder on 16.06.2021 in W.P.No.43662 of 2016 as under: 12.A perusal of the reasons extractedelsewhere in this order only referred to the issueof classification of royalty on merits and nowhere it is stated that there has been any failure bythe petitioner in making a disclosure in thisregard. To be fair to the Assessing Officer, hedoes not even make such allegation in the reasonsfor re-assessment and rightly so, since thematerial available would show a full disclosure bythe petitioner at all stages of assessment.Thus I am of the view that the impugned orderdated 26.08.2019 rejecting the objections toassumption of jurisdiction is liable to be quashedand I do so.” 8.In the case of M/s.Kone Elevators (India) Pvt. Limited,Vs. Assistant Commissioner of Income-Tax, this Court passed theorder on 16.06.2021 in W.P.No.43662 of 2016 as under: “12.Let us now look into the conditionsstipulated under Proviso to Section 147 of theAct, which contemplates that where an assesseeunder sub-Section (3) of Section 147 or Section147 has been made for the relevant assessmentyear, no action shall be taken under Section 147after the expiry of four years from the end of therelevant assessment year, unless any incomechargeable to tax has escaped assessment for suchassessment year by reason of failure on the partof the assessee to make a return under Section 139or in response to a notice issued under sub-Section (1) of Section 142 or Section 148 or todisclose fully and truly all material factsnecessary for his assessment, for that assessmentyear. ................ 14.The language employed in the Provision isto be interpreted constructively and pragmaticallyso as to understand the purpose and object. Plainmeaning would not serve the purpose to meet outthe object of the provision. Thus, this Court isof an opinion that the language employed under theProviso to Section 147 i.e., “to disclose fullyand truly all material facts” denotes that theremust be an intention or motive on the part of theassessee to suppress certain facts at the time ofpassing an assessment order by the originalauthority. 15.Question may arise, if certain non-disclosure can be a ground for reopening. In thisregard, absolutely there is no bar for reopeningof assessment within a period of four years underSection 147 of the Act and if the reopening ofassessment is to be made beyond four years, then it must be established that the assessee has notdisclosed fully and truly all material evidencewith an intention to escape from the payment oftax. Mere non-disclosure is insufficient in viewof the fact that the assessee may have certainopinions in the matter of furnishing certaindetails to the Assessing Officer. Therefore, themotive or intention on the part of the assesseefor such non-disclosure is also a material groundto be considered by the Courts as well as by theauthority at the time of reopening of assessmentbeyond the period of four years. it must be established that the assessee has notdisclosed fully and truly all material evidencewith an intention to escape from the payment oftax. Mere non-disclosure is insufficient in viewof the fact that the assessee may have certainopinions in the matter of furnishing certaindetails to the Assessing Officer. Therefore, themotive or intention on the part of the assesseefor such non-disclosure is also a material groundto be considered by the Courts as well as by theauthority at the time of reopening of assessmentbeyond the period of four years. 16.In respect of the case on hand,undoubtedly, the assessee had not submitted theratification certificate to be obtained from theCBDT for claiming exemption under Section 10B ofthe Act. However, there are certain confusionseven within the Department Officials regardingproduction of such ratification certificate fromthe CBDT. The dispute arises in view of the factthat the assessee is of an opinion that theapproval granted by the STPI under the delegatedpowers of the Directors of STPI by IMSC is a validapproval for the purpose of claiming exemptionunder Section 10B of the Act. Therefore, thepresumption cannot be construed as suppression onthe part of the assessee. It is not a merepresumption in the present case by the assessee.The presumption has got a valid reason because theassessee is holding a valid approval obtained fromthe STPI and the power to grant approval wasdelegated to the Directors of STPI by IMSC. It isnot as if the assessee claimed exemption underSection 10B without any such approval. It is acase where the order of approval, which wasvalidly granted, was produced before the AssessingOfficer at the time of scrutiny and the AssessingOfficer also accepted the approval order andgranted exemption. Thus, the reason stated in theimpugned proceedings that the assessee committed amistake cannot be accepted. The assessee waspossessing a valid approval which was producedbefore the Assessing Officer and if a ratificationis to be obtained, then the Assessing Officer, atthe time of scrutiny, ought to have directed theassessee to get any such ratification certificatefor the purpose of grant of exemption underSection 10B which the Department had not done.Thus, it was a mistake or omission committed by the Assessing Officer at the time of passing ofthe original assessment order. Even in suchcases, if the reopening of assessment is madewithin a period of four years, then there is aground for the Department to reopen the same.However, in the present case, the reopening ofassessment is made beyond the period of four yearsandtherefore,thestatutoryrequirementcontemplated under Section 147 is to be compliedwith scrupulously. Thus, the ground taken forreopening of assessment that the assessee has notdisclosed fully and truly all material facts isnot established in the present case and theassessee, in fact, submitted all the particularsregarding the approval granted by the authorityand further ratification, if required, must beinstructed by the Department which was not doneand therefore, there was no suppression or non-disclosure of material facts by the assessee.Thus, the initiation of proceedings under Section147 of the Act, beyond the period of four years,is not sustainable and consequently, the impugnedproceedings are not in consonance with theconditions stipulated in the Proviso to Section147 of the Act.” 9.The three Judges Bench of the Hon'ble Supreme Court ofIndia, in the case of TIN Box Company, New Delhi Vs. CIT, NewDelhi, reported in (2001) 9 SCC 725, made an observation asfollows: 9.The three Judges Bench of the Hon'ble Supreme Court ofIndia, in the case of TIN Box Company, New Delhi Vs. CIT, NewDelhi, reported in (2001) 9 SCC 725, made an observation asfollows: “2................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 theHigh Court that it was not necessary to set asidethe order of assessment and remand the matter tothe assessing authority for fresh assessment aftergiving to the assessee a proper opportunity ofbeing heard. ............5.................The matter shall now beremanded to the assessing authority for freshconsideration, as aforestated. No order as tocosts.” 10.In the case of T.M.Hotels Private Limited Vs. TheAdditional Commissioner of Central Excise, this Court passed anorder on 06.07.2021 in W.P.No.14099 of 2014 as under:“7.This Court is of the considered opinionthat in all circumstances, the parties aggrieved https://hcservices.ecourts.gov.in/hcservices/ are bound to prefer an appeal before the appellateauthority. However, in certain circumstances, theCourts are bound to consider whether the denial ofopportunity caused certain prejudice to theinterest of the person aggrieved. In the presentcase, admittedly, the summons were issued to thepetitioner. However, the learned counsel for thepetitioner entered appearance in the proceedingsbefore the respondent on 04.03.2014 itself. Thus,there is a possibility that the petitioner wouldnot have informed about the summons to theircounsel regarding the personal hearing. Underthose circumstances, the counsel was not aware ofthe date of hearing and the same resulted inpassing of the final order without hearing thelearned counsel who entered appearance on behalfof the writ petitioner.” 11.Relying on the above judgments, the learned SeniorCounsel reiterated that the petitioner need not be unnecessarilydriven to approach the appellate authority for exhausting theappeal remedy. Instead, the case is to be admitted and therespondent must be directed to file counter in respect of thegrounds raised in the present Writ Petitions. 12.The learned Senior Standing Counsel appearing on behalfof the respondent solicited the attention of this Court withreference to the Writ Petition earlier filed by the very samewrit petitioner in W.P.No.989 of 2011. The petitioner challengedthe 148 notice and the consequential proceedings and this Courtconsidered the case of the petitioner and pass an order on19.07.2019, granting liberty to the petitioner. The petitioneralso submitted various letters and perusal of the said letterswould reveal that the petitioner has made an attempt to prolongand protract the matter, instead of defending their case byavailing the opportunities provided by the authoritiescompetent, pursuant to the orders passed by this Court.Therefore, the Assessing Officer, after providing opportunity ascontemplated, passed the final orders of assessment on meritsand in accordance with law. Thus, the petitioner has to availthe remedy provided under the Act. The petitioner may raise allthe legal and factual grounds before the appellate authority foreffective adjudication. Thus, the Writ Petitions are to berejected. 13.The question to be considered by this Court is, whetherthe Court may dispense with the appellate remedy, contemplatedunder the provisions of the Act, in a routine and casual manner,which would undermine the authorities on appeal. 13.The question to be considered by this Court is, whetherthe Court may dispense with the appellate remedy, contemplatedunder the provisions of the Act, in a routine and casual manner,which would undermine the authorities on appeal. 14.On several occasions, the similar issue was considered byvarious constitutional Courts across the Country. In allcircumstances, the aggrieved person is bound to exhaust theappellate remedy provided under the relevant statutes. Only onexceptional circumstance, where the order in question was issuedby an incompetent authority having no jurisdiction under theprovisions of the statute or allegations of malafides areraised, then a writ proceedings may be entertained. Even in caseof raising an allegation of malafides, the authority againstwhom such an allegation is raised must be impleaded as partyrespondent in his personal capacity. 15.The importance of exhausting the appellate remedy isconsistently insisted upon by the constitutional Courts. Theefficacious remedy provided under the statute need not beundermined, nor an opportunity provided to the aggrieved personunder the statute need not be taken away in casual and routinemanner. In the event of dispensing with the appellate remedy,the aggrieved person is deprived of an opportunity to adjudicatethe disputes/merits with reference to the original documents andevidences. Undoubtedly, the appellate authority is the finalfact finding authority and their findings in a appellateproceedings may be of valuable assistance to the constitutionalCourts to exercise the power of judicial review, effectivelyunder Article 226 of the Constitution of India, for the purposeof providing complete justice to the parties to the lis.Therefore, the Courts are expected to be cautious, whiledispensing with the appellate remedy and casual admissions ofwrit petitions are to be avoided. Whenever the appellate remedyis contemplated, which is efficacious, then the parties arebound to exhaust the same. 16.The litigants are approaching the High Court withoutexhausting the remedy. Sometimes, with an idea to avoid pre-deposits, if any prescribed, or by stating that they may not getspeedy and efficacious remedy. These grounds cannot becountenanced as the legislative intention for providing anappellate remedy, at no circumstances, be diluted, nor beconstrued as ineffective. The appellate authorities, undoubtedlyare possessing certain expertise in a particular field and theirdeliberation and findings are of paramount importance for thepurpose of exercise of power of judicial review in a writproceedings. Therefore, in the event of entertaining a WritPetition against an Order-in-Original, the High Court iscompelled to adjudicate the disputed facts. It is pertinent tonote that such disputed facts, on some occasions, areadjudicated merely based on the affidavits filed by therespective parties, as well as the selective Xerox copies of thedocuments filed along with the Writ Petitions. Such anadjudication may result in erroneous consideration of certain factual aspects and there is a possibility of commission andomission at the instance of the parties. The High Court,therefore, is expected to exercise restraint in adjudicating thedisputed facts, which is to be made by the final fact findingauthority, based on the original records and materials. 17.As far as exhaustion of appellate remedy is concerned,this Court has elaborately discussed the importance ofexhausting the appellate remedy taking note of the judgments ofthe Hon'ble Supreme Court of India in the case of M/s.Sri SathyaJewellery Vs. The Principal Commissioner of Customs, inW.P.No.3144 of 2016 dated 15.04.2021, which reads as under: factual aspects and there is a possibility of commission andomission at the instance of the parties. The High Court,therefore, is expected to exercise restraint in adjudicating thedisputed facts, which is to be made by the final fact findingauthority, based on the original records and materials. 17.As far as exhaustion of appellate remedy is concerned,this Court has elaborately discussed the importance ofexhausting the appellate remedy taking note of the judgments ofthe Hon'ble Supreme Court of India in the case of M/s.Sri SathyaJewellery Vs. The Principal Commissioner of Customs, inW.P.No.3144 of 2016 dated 15.04.2021, which reads as under: “14.This Court elaborately discussed the importanceof exhausting the appellate remedy in the case ofM/s.Hyundai Motor India Limited v. The Deputy Commissionerof Income Tax, Chennai and another [W.P.No.22508 of 2017dated 16.07.2018], from which, the following paragraphsare extracted : “19.Unnecessary or routine invasion into thestatutory powers of the competent authorities under astatute should be restrained by the ConstitutionalCourts. Frequent or unnecessary invasions in theexecutive power will defeat the constitutionalperspectives enshrined under the Constitution ofIndia. Undoubtedly, the separation of powers underthe Indian Constitution has been narrated and settledin umpteen number of judgments. Separation of powersdemarcated in the Constitution of India is also to beconsidered, while exercising the powers of judicialreview in the matter of dispensing with the appealremedy provided for an aggrieved person under astatute. If the High Courts started interfering withsuch Appellate powers without any valid andsubstantiated reasons, then the very purpose andobject of the statute and provision of appeal underthe statute became an empty formality and the HighCourts also should see that the provisions of appealcontemplated under the statutes are implemented inits real spirit and in accordance with the procedurescontemplated under the rules constituted thereon.While entertaining a writ petition as narrated by theApex Court, the provision of efficacious alternativeremedy under the statute also to be considered. Ifthe writ petitions are entertained in a routinemanner, by not allowing the competent Appellateauthority to exercise their powers under theprovisions of the statute, then this Court is of anopinion that the power of judicial review has notexercised in a proper manner. Thus, it is necessaryfor this Court to elaborate the legal principle settled in respect of the separation of powers underthe Constitution of India. 1. Madras Bar Association vs. Union of India (UOI)(25.09.2014 - SC) : MANU/SC/0875/2014 If the historical background, the preamble, theentire scheme of the Constitution, relevant provisionsthereof including Article 368 are kept in mind therecan be no difficulty in discerning that the followingcan be regarded as the basic elements of theconstitutional structure. (These cannot be cataloguedbut can only be illustrated): (1) The supremacy of the Constitution. (2) Republican and Democratic form of government andsovereignty of the country. (3) Secular and federal character of the Constitution. (4) Demarcation of power between the Legislature, theexecutive and the judiciary. (5) The dignity of the individual secured by thevarious freedoms and basic rights in Part III and themandate to build a welfare State contained in Part IV. (6) The unity and the integrity of the Nation. 2. Holiness Kesavananda Bharati Sripadagalvaru v.State of Kerala and Anr.[MANU/SC/0445/1973: (1973)4 SCC 225]. That separation of powers between the legislature,theexecutiveand the judiciary is the basic structureof the Constitution is expressly stated by Sikri, C.J. (1) The supremacy of the Constitution. (2) Republican and Democratic form of government andsovereignty of the country. (3) Secular and federal character of the Constitution. (4) Demarcation of power between the Legislature, theexecutive and the judiciary. (5) The dignity of the individual secured by thevarious freedoms and basic rights in Part III and themandate to build a welfare State contained in Part IV. (6) The unity and the integrity of the Nation. 2. Holiness Kesavananda Bharati Sripadagalvaru v.State of Kerala and Anr.[MANU/SC/0445/1973: (1973)4 SCC 225]. That separation of powers between the legislature,theexecutiveand the judiciary is the basic structureof the Constitution is expressly stated by Sikri, C.J. 3. P. Kannadasan and Ors. v. State of T.N. and Ors.[MANU/SC/0650/1996 : (1996) 5 SCC 670] the SupremeCourt noted that the Constitution of India recognisedthe doctrine of separation of powers between the threeorgans of the State, namely, the legislature, theexecutive and the judiciary. The Court said: It must be remembered that our Constitution recognisesand incorporates the doctrine of separation of powersbetween the three organs of the State, viz., theLegislature, the Executive and the Judiciary. Eventhough the Constitution has adopted the parliamentaryform of government where the dividing line between thelegislature and the executive becomes thin, the theoryof separation of powers is still valid. 4. State of Tamil Nadu and Ors. vs. State of Keralaand Ors. (07.05.2014 - SC) : MANU/SC/0425/2014 121. On deep reflection of the above discussion, inour opinion, the constitutional principles in thecontext of Indian Constitution relating to separationof powers between legislature, executive and judiciarymay, in brief, be summarized thus: (i) Even without express provision of the separationof powers,the doctrine of separation of powers is anentrenched principle in the Constitution of India. The doctrine of separation of powers informs theIndian constitutional structure and it is an essentialconstituent of rule of law. In other words, the doctrine of separation of powerthough not expressly engrafted in the Constitution,its sweep, operation and visibility are apparent fromthe scheme of Indian Constitution. Constitution hasmade demarcation, without drawing formal lines betweenthe three organs- legislature, executive andjudiciary. In that sense, even in the absence ofexpress provision for separation of power, theseparation of power between legislature, executive andjudiciary is not different from the constitutions ofthe countries which contain express provision forseparation of powers. (ii) Independence of courts from the executive andlegislature is fundamental to the rule of law and oneof the basic tenets of Indian Constitution. Separation of judicial power is a significantconstitutional principle under the Constitution ofIndia. (iii) Separation of powers between three organs--legislature, executive and judiciary--is also nothingbut a consequence of principles of equality enshrinedin Article 14 of the Constitution of India.Accordingly, breach of separation of judicial powermay amount to negation of equality Under Article 14.Stated thus, a legislation can be invalidated on thebasis of breach of the separation of powers since suchbreach is negation of equality Under Article 14 of theConstitution. (iv) The superior judiciary (High Courts and SupremeCourt) is empowered by the Constitution to declare alaw made by the legislature (Parliament and Statelegislatures) void if it is found to have transgressedthe constitutional limitations or if it infringed the rights enshrined in Part III of the Constitution. (iii) Separation of powers between three organs--legislature, executive and judiciary--is also nothingbut a consequence of principles of equality enshrinedin Article 14 of the Constitution of India.Accordingly, breach of separation of judicial powermay amount to negation of equality Under Article 14.Stated thus, a legislation can be invalidated on thebasis of breach of the separation of powers since suchbreach is negation of equality Under Article 14 of theConstitution. (iv) The superior judiciary (High Courts and SupremeCourt) is empowered by the Constitution to declare alaw made by the legislature (Parliament and Statelegislatures) void if it is found to have transgressedthe constitutional limitations or if it infringed the rights enshrined in Part III of the Constitution. (v) The doctrine of separation of powers applies tothe final judgments of the courts. Legislature cannotdeclare any decision of a court of law to be void orof no effect. It can, however, pass an amending Act toremedy the defects pointed out by a court of law or oncoming to know of it aligned. In other words, a court's decision must always bindunless the conditions on which it is based are sofundamentally altered that the decision could not havebeen given in the altered circumstances. (vi) If the legislature has the power over thesubject-matter and competence to make a validatinglaw, it can at any time make such a validating law andmake it retrospective. The validity of a validatinglaw, therefore, depends upon whether the legislaturepossesses the competence which it claims over thesubject-matter and whether in making the validationlaw it removes the defect which the courts had foundin the existing law. 20.This Court is of a strong opinion thatinstitutional respects are to be maintained by theconstitutional Courts. Whenever there is a provisionfor an appeal under the statute, without exhaustingthe remedies available under the statute, no writpetition can be entertained in a routine manner. Onlyon exceptional circumstances, the remedy of appeal canbe waived, if there is a gross injustice or if thereis a violation of fundamental rights ensured under theConstitution of India. Otherwise, all the aggrievedpersons from and out of the order passed by theoriginal authority is bound to approach the AppellateAuthority. The Constitutional Courts cannot make anappeal provision as an empty formality. EveryAppellate Authority created under the statute to betrusted in normal circumstances unless there is aspecific allegation, which is substantiated in a writproceedings. Thus, the institutional functions andexhausting the appeal remedies by the aggrievedpersons, are to be enforced in all circumstances andwrit proceedings can be entertained only onexceptional circumstances. Rule is to prefer an appealand entertaining a writ is only an exception. Thisbeing the legal principles to be followed, this Courtcannot entertain the writ petitions in a routinemanner by waiving the remedy of appeal provided underthe statute. 21.Now, let us look into the legal principles settled by the Apex Court for exhausting theefficacious alternative remedy provided under thestatute. 22.When an effective alternative remedy isavailable, a writ petition cannot be maintained 1. In City and Industrial Development Corporation v.DosuAardeshirBhiwandiwala and Ors. MANU/SC/8250/2008 : (2009) 1 SCC 168, this Court had observed that: The Court while exercising its jurisdiction underArticle 226 is duty-bound to consider whether: (a) adjudication of writ petition involves any complexand disputed questions of facts and whether they can besatisfactorily resolved; (b) the petition reveals all material facts; (c) the Petitioner has any alternative or effectiveremedy for the resolution of the dispute; (d) person invoking the jurisdiction is guilty ofunexplained delay and laches; 22.When an effective alternative remedy isavailable, a writ petition cannot be maintained 1. In City and Industrial Development Corporation v.DosuAardeshirBhiwandiwala and Ors. MANU/SC/8250/2008 : (2009) 1 SCC 168, this Court had observed that: The Court while exercising its jurisdiction underArticle 226 is duty-bound to consider whether: (a) adjudication of writ petition involves any complexand disputed questions of facts and whether they can besatisfactorily resolved; (b) the petition reveals all material facts; (c) the Petitioner has any alternative or effectiveremedy for the resolution of the dispute; (d) person invoking the jurisdiction is guilty ofunexplained delay and laches; (e) ex facie barred by any laws of limitation; (f) grant of relief is against public policy or barredby any valid law; and host of other factors. 2. KanaiyalalLalchand Sachdev and Ors. vs. State ofMaharashtra and Ors. (07.02.2011 - SC) :MANU/SC/0103/2011 It is well settled that ordinarily relief UnderArticles 226/227 of the Constitution of India is notavailable if an efficacious alternative remedy isavailable to any aggrieved person. (See Sadhana Lodh v.National Insurance Co. Ltd.; Surya Dev Rai v. RamChander Rai and SBI v. Allied Chemical Laboratories.) 3. Commissioner of Income Tax and Ors. v. ChhabilDassAgarwal, MANU/SC/0802/2013 : 2014 (1) SCC 603, asfollows: Para 15. while it can be said that this Court hasrecognised some exceptions to the Rule of alternativeremedy i.e. where the statutory authority has not actedin accordance with the provisions of the enactment inquestion, or in defiance of the fundamental principlesof judicial procedure, or has resorted to invoke theprovisions which are repealed, or when an order hasbeen passed in total violation of the principles ofnatural justice, the proposition laid down inThansinghNathmal case, Titaghur Paper Mills case andother similar judgments that the High Court will not entertain a petition Under Article 226 of theConstitution if an effective alternative remedy isavailable to the aggrieved person or the statute underwhich the action complained of has been taken itselfcontains a mechanism for redressal of grievance stillholds the field. Therefore, when a statutory forum iscreated by law for redressal of grievances, a writpetition should not be entertained ignoring thestatutory dispensation. 4. Authorized Officer, State Bank of Travancore andOrs. vs. Mathew K.C. (30.01.2018 - SC) :MANU/SC/0054/2018 The petitioner argued that the SARFAESI Act is acomplete code by itself, providing for expeditiousrecovery of dues arising out of loans granted byfinancial institutions, the remedy of appeal by theaggrieved under Section 17 before the Debt RecoveryTribunal, followed by a right to appeal before theAppellate Tribunal under Section 18. The High Courtought not to have entertained the writ petition in viewof the adequate alternate statutory remedies availableto the Respondent. The interim order was passed on thevery first date, without an opportunity to theAppellant to file a reply. Reliance was placedon United Bank of India vs. Satyawati Tandon andothers, 2010 (8) SCC 110, and General Manager, SriSiddeshwara Cooperative Bank Limited and another vs.Ikbal and others, 2013 (10) SCC 83. The writ petitionought to have been dismissed at the threshold on theground of maintainability. The Division Bench erred indeclining to interfere with the same. The Supreme Courtagreed to the arguments and held the same also notedthat the writ petition ought not to have beenentertained and the interim order granted for the mereasking without assigning special reasons, and that toowithout even granting opportunity to the Appellant tocontest the maintainability of the writ petition andfailure to notice the subsequent developments in theinterregnum. 5. State of Himachal Pradesh v. Gujarat Ambuja CementLtd. reported at AIR 2005 SC 3856, the Supreme Courtexplained the rule of 'alternate remedy' in thefollowing terms Considering the plea regarding alternative remedy asraised by the appellant-State. Except for a period whenArticle 226 was amended by the Constitution (42ndAmendment) Act, 1976, the power relating to alternativeremedy has been considered to be a rule of self imposed limitation. It is essentially a rule of policy,convenience and discretion and never a rule of law.Despite the existence of an alternative remedy itis within the jurisdiction of discretion of the HighCourt to grant relief under Article 226 of theConstitution. At the same time, it cannot be lost sightof that though the matter relating to an alternativeremedy has nothing to do with the jurisdiction of thecase, normally the High Court should not interfere ifthere is an adequate efficacious alternative remedy. Ifsomebody approaches the High Court without availing thealternative remedy provided the High Court shouldensure that he has made out a strong case or that thereexist good grounds to invoke the extraordinaryjurisdiction. 6. K.S. Rashid and Sons v. Income Tax InvestigationCommission and Ors., AIR (1954) SC 207; Sangram Singhv. Election Tribunal, Kotah and Ors., AIR (1955) SC425; Union of India v. T.R. Varma, AIR (1957) SC 882;State of U.P. and Ors. v. Mohammad Nooh, AIR (1958) SC86 and M/s K.S. Venkataraman and Co. (P) Ltd. v. Stateof Madras, AIR (1966) SC 1089, Constitution Benches of the Supreme Court held thatArticle 226 of the Constitution confers on all the HighCourts a very wide power in the matter of issuingwrits. However, the remedy of writ is an absolutelydiscretionary remedy and the High Court has always thediscretion to refuse to grant any writ if it issatisfied that the aggrieved party can have an adequateor suitable relief elsewhere. The Court, inextraordinary circumstances, may exercise the power ifit comes to the conclusion that there has been a breachof principles of natural justice or procedure requiredfor decision has not been adopted. 7. First Income-Tax Officer, Salem v. M/s. ShortBrothers (P) Ltd., [1966] 3 SCR 84 and State of U.P.and Ors. v. M/s. Indian Hume Pipe Co. Ltd., [1977] 2SCC 724. There are two well recognized exceptions to thedoctrine of exhaustion of statutory remedies. First iswhen the proceedings are taken before the forum undera provision of law which is ultra vires, it is open toa party aggrieved thereby to move the High Court forquashing the proceedings on the ground that they areincompetent without a party being obliged to waituntil those proceedings run their full course.Secondly, the doctrine has no application when theimpugned order has been made in violation of the principles of natural justice. We may add that wherethe proceedings itself are an abuse of process of lawthe High Court in an appropriate case can entertain awrit petition.” 18.The Hon'ble Supreme Court of India, in the case ofM/s.Canon India Private Limited v. Commissioner of Customs[Civil Appeal No.1827 of 2018, dated 09.03.2021] dealt with thejurisdiction aspect with reference to the provisions of thestatute in paragraph Nos.9, 12, 13 and 15, which all areextracted hereunder: principles of natural justice. We may add that wherethe proceedings itself are an abuse of process of lawthe High Court in an appropriate case can entertain awrit petition.” 18.The Hon'ble Supreme Court of India, in the case ofM/s.Canon India Private Limited v. Commissioner of Customs[Civil Appeal No.1827 of 2018, dated 09.03.2021] dealt with thejurisdiction aspect with reference to the provisions of thestatute in paragraph Nos.9, 12, 13 and 15, which all areextracted hereunder: “9.The question that arises is whether theDirectorate of Revenue Intelligence had authorityin law to issue a show cause notice under Section28(4) of the Act for recovery of duties allegedlynot levied or paid when the goods have beencleared for import by a Deputy Commissioner ofCustoms who decided that the goods are exempted.It is necessary that the answer must flow from thepower conferred by the statute i.e. under Section28(4) of the Act. This Section empowers therecovery of duty not paid, part paid orerroneously refunded by reason of collusion or anywilful mis-statement or suppression of facts andconfers the power of recovery on “the properofficer”. The obvious intention is to confer thepower to recover such duties not on any properofficer but only on “the proper officer”. ThisCourt in Consolidated Coffee Ltd. and Another vs.Coffee Board, Bangalore has held:- “14....Secondly,andmoreimportantly, the user of the definitearticle ‘the’ before the word ‘agreement’is, in our view, very significant.Parliament has not said ‘an agreement’ or'any agreement’ for or in relation tosuch export and in the context theexpression ‘the agreement’ would refer tothat agreement which is implicit in thesale occasioning the export.” In Shri Ishar Alloy Steels Ltd. vs.Jayaswals Neco Ltd. has held:- “9. ...’The’ is the word used beforenouns,withaspecifyingorparticularising effect as opposed to theindefinite or generalizing force of ‘a’or ‘an’. It determines what particularthing is meant; that is, what particularthing we are to assume to be meant. ‘The’is always mentioned to denote a particular thing or a person.” ... 12.The nature of the power to recover theduty, not paid or short paid after the goods havebeen assessed and cleared for import, is broadly apower to review the earlier decision ofassessment. Such a power is not inherent in anyauthority. Indeed, it has been conferred bySection 28 and other related provisions. The powerhas been so conferred specifically on “the properofficer” which must necessarily mean the properofficer who, in the first instance, assessed andcleared the goods i.e. the Deputy CommissionerAppraisal Group. Indeed, this must be so becauseno fiscal statute has been shown to us where thepower to re-open assessment or recover dutieswhich have escaped assessment has been conferredon an officer other than the officer of the rankof the officer who initially took the decision toassess the goods. 13.Where the statute confers the same power toperform an act on different officers, as in thiscase, the two officers, especially when theybelong to different departments, cannot exercisetheir powers in the same case. Where one officerhas exercised his powers of assessment, the powerto order re-assessment must also be exercised bythe same officer or his successor and not byanother officer of another department though he isdesignated to be an officer of the same rank. Inour view, this would result into an anarchical andunruly operation of a statute which is notcontemplated by any canon of construction ofstatute. 13.Where the statute confers the same power toperform an act on different officers, as in thiscase, the two officers, especially when theybelong to different departments, cannot exercisetheir powers in the same case. Where one officerhas exercised his powers of assessment, the powerto order re-assessment must also be exercised bythe same officer or his successor and not byanother officer of another department though he isdesignated to be an officer of the same rank. Inour view, this would result into an anarchical andunruly operation of a statute which is notcontemplated by any canon of construction ofstatute. ... 15.It is obvious that the re-assessment andrecovery of duties i.e. contemplated by Section 28(4) is by the same authority and not by anysuperior authority such as Appellate or RevisionalAuthority. It is, therefore, clear to us that theAdditional Director General of DRI was not “the”proper officer to exercise the power under Section28(4) and the initiation of the recoveryproceedings in the pre