Wp(C)/9917/2021 Of Chams Branding Solutions India Pvt.ltd v. Deputy Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS FRIDAY, THE 29 DAY OF OCTOBER 2021 / 7TH KARTHIKA, 1943 WP(C) NO. 9917 OF 2021 PETITIONER: CHAMS BRANDING SOLUTIONS INDIA PVT.LTD. 31/673D1, CHAMS HOUSE, S.A.ROAD, VYTTILA, KOCHI-682 019, REPRESENTED BY ITS MANAGING DIRECTOR MR. MISBAH SALAM.BY ADVS.SRI.ANIL D. NAIRSRI.R.SREEJITHSMT.TELMA RAJUSRI.SANGEETH JOSEPH JACOBSMT.CHRISTINA ANNA PAUL RESPONDENTS: 1DEPUTY COMMISSIONER OF INCOME TAXCPC, BANGALORE-560 500.CPC, BANGALORE-560 500. 2THE INCOME TAX OFFICER NATIONAL eASSESSMENT CENTER (NeAC), 2ND FLOOR, E-RAMP, ROOM NO.401, JAWAHARLAL NEHRU STADIUM, NEW DELHI-110 003. BY ADV.JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FORADMISSION ON 22.10.2021, THE COURT ON 29.10.2021 DELIVEREDTHE FOLLOWING: BECHU KURIAN THOMAS, J. -----------------------------------------W.P.(C) No.9917 of 2021 ---------------------------------------- Dated this the 29[th] day of October, 2021 JUDGMENT Petitioner is involved in the business of Advertisement. It is anassessee under the Income Tax Act, 1961 ('the Act' for brevity). For theassessment year 2018-19, petitioner had filed its returns. Subsequently, italleges to have received notice issued under section 142(1) of the Act on24.12.2019, pursuant to which a detailed reply was filed by the petitioner.Petitioner claimed that no other notices were issued to the petitioner otherthan the aforementioned notice dated 24.12.2019, a copy of which isproduced as Ext.P4. However, by order dated 15.03.2021, petitioner wasserved with a huge demand, on the basis of an assessment alleged tohave been carried out under section 143(3) of the Act. Petitioner allegesthat the order of assessment is bad in law since no notices other than theone under section 142(1) of the Act was ever served upon it and hencethere is a clear violation of the principles of natural justice. 2. A statement has been filed on behalf of the second respondent wherein it is stated that petitioner was given several opportunities tosubmit the details, including the notices on 28.09.2019, 24.12.2019,04.03.2020, 28.07.2020, 17.12.2020 and 18.02.2021. It is also statedthat a further show-cause notice was issued on 12.03.2021 requesting thepetitioner to submit its replies against the proposed additions on or before14.03.2021. According to the second respondent, on all the above-referred occasions, petitioner failed to submit any details. It was in suchcircumstances that Ext.P5 assessment order came to be issued. 3. I have heard Adv. Anil D.Nair, the learned counsel for thepetitioner as well as Adv.Jose Joseph, the learned Standing counsel forthe Income Tax Department. 4. Adv. Anil D.Nair vehemently contended that the order is bad inlaw for violation of the principles of natural justice. After referring tocolumn 44 in Ext.P3 audit report, which was relied upon in theassessment order, it was contended that, ex facie the assessment order isperverse since the figures in column 44 of the audit report itself revealedthat those became applicable only from April, 2019 and that the figurescarved out by the Assessing Officer were wholly obscure and baseless. 5. Adv. Jose Joseph, the learned Standing Counsel for therespondents’ on the other hand, pointed out that, the pleadings in the writpetition that petitioner had never received any notice other than Ext.P4, isincorrect and that it had not approached this Court revealing the true particulars. It was also submitted that, in any event, the issue raised bythe petitioner requires an appreciation of disputed facts and hence, thisCourt ought not to interfere invoking the jurisdiction under Article 226 ofthe Constitution of India. However, it was fairly conceded that there was atechnical error in the disallowance of Rs.2,18,27,419/-, which being anapparent error, can be rectified under section 154 of the Act. 5. Adv. Jose Joseph, the learned Standing Counsel for therespondents’ on the other hand, pointed out that, the pleadings in the writpetition that petitioner had never received any notice other than Ext.P4, isincorrect and that it had not approached this Court revealing the true particulars. It was also submitted that, in any event, the issue raised bythe petitioner requires an appreciation of disputed facts and hence, thisCourt ought not to interfere invoking the jurisdiction under Article 226 ofthe Constitution of India. However, it was fairly conceded that there was atechnical error in the disallowance of Rs.2,18,27,419/-, which being anapparent error, can be rectified under section 154 of the Act. 6. On a consideration of the contentions raised by both parties, Iam of the view that this is not a fit case to invoke the discretionaryjurisdiction of this Court under Article 226 of the Constitution of India, formore reasons than one. 7. The assessment order under challenge was issued after grantingsufficient opportunity to the petitioner including various notices issuedunder sections 143 and 142 of the Act. Petitioner had not replied to any ofthose notices. Petitioner cannot thereafter, turn around and contend that itwas not granted an opportunity or that there was any violation of principlesof natural justice. 8. Though the last notice issued to the petitioner was on 12.03.2021, requiring it to reply on 14.03.2021, which in strict senso maynot appear to be a reasonable or sufficient period to submit a reply,considering the background of the case and the repeated failure of thepetitioner to respond to any of the six prior notices issued on 28.09.2019,24.12.2019, 04.03.2020, 28.07.2020, 17.12.2020 and 18.02.2021, I am of the view that petitioner cannot claim the benefit of violation of principles ofnatural justice. Petitioner's conduct reveals its adamant approach torefrain from responding to notices. 9. The notice of 12.03.2021 requesting the petitioner to submit its replies against the proposed additions on or before 14.03.2021 cannot beviewed in isolation or dehors the past conduct of the petitioner. In fact,even for the notice of 12-03-2021, petitioner had not even cared to replythat he needs more time to respond. Violation of principles of naturaljustice has to be viewed with reference to facts of each case also. Aperson who had not responded to any notices issued in the past cannot,without anything more, turnaround and complain, that in the last noticeissued he was not granted reasonable time to respond, especially whensuch a request for time was not even sought as a reply to the last notice. 10. In this context, the absence of pleading about the five noticesissued to the petitioner and the omission to reveal in the writ petition, thereceipt of notices is singularly detrimental to the petitioner. In the writpetition, petitioner asserted that it had not received any notice other thanthe notice dated 24.12.2019. Petitioner failed to divulge the receipt of fiveother notices. This conduct also must deprive the petitioner of the benefitof exercise of the discretionary jurisdiction under Article 226 of theConstitution of India. 11. In any event, it is trite law that this Court would be loath to interfere where alternative and efficacious remedies are available for theassessees. Article 226 is not meant to short circuit or circumvent statutoryprocedures. it is only when the statutory remedies are entirely ill-suited tomeet the demands of extraordinary situations that the Court shouldinterfere under Article 226, especially in matters of taxation. Such asituation is not existing in the instant case. 11. In any event, it is trite law that this Court would be loath to interfere where alternative and efficacious remedies are available for theassessees. Article 226 is not meant to short circuit or circumvent statutoryprocedures. it is only when the statutory remedies are entirely ill-suited tomeet the demands of extraordinary situations that the Court shouldinterfere under Article 226, especially in matters of taxation. Such asituation is not existing in the instant case. 12. Further, in a recent decision of the Supreme Court, it was heldthat, though not a bar, entertaining a writ petition must be only inexceptional circumstances where there is a breach of fundamental rightsor a violation of the principles of natural justice or an excess of jurisdictionor when there is a challenge to the vires of the statute.(See AssistantCommissioner of State Tax and Others v. Commercial Steel Limited,[(2021) SCC Online 884]. Since I have already held that in the facts ofthis case there cannot be a justifiable case of violation of natural justice,the exceptional circumstances mentioned above to invoke the remedyunder Article 226 is not available to the petitioner. 13. As rightly submitted by the learned Standing Counsel, though theassessment order contains a technical issue in the computationstatement, that is a matter which can be rectified under section 154 of theAct and hence the same need not be considered under Article 226. I findforce in the submission of the learned counsel. 14. In view of the above deliberations, I find no merit to interfere in W.P.(C) No.9917/21 -:7:- the matter, exercising the discretionary jurisdiction under Article 226 of the Constitution of India. However, liberty of the petitioner to pursue itsstatutory remedies is reserved. The writ petition is accordingly dismissed. Sd/- vps BECHU KURIAN THOMAS JUDGE APPENDIX OF WP(C) 9917/2021 PETITIONER EXHIBITS EXHIBIT P1TRUE COPY OF THE ACKNOWLEDGMENT DATED 4.10.2018 EVIDENCING RETURNS FILED BYTHE PETITIONER.THE PETITIONER. EXHIBIT P2TRUE COPY OF ITR 6 DATED 1.10.2018 FILEDBY THE PETITIONER.BY THE PETITIONER. EXHIBIT P3 TRUE COPY OF THE AUDIT REPORT IN FORMNO.3CA DATED 1.10.2018 FILED BY THEPETITIONER.NO.3CA DATED 1.10.2018 FILED BY THEPETITIONER. EXHIBIT P4TRUE COPY OF NOTICE ISSUED BY THE 2NDRESPONDENT DATED 24.12.2019.RESPONDENT DATED 24.12.2019. EXHIBIT P5 TRUE COPY OF THE ASSESSMENT ORDER DATED15.3.2021 ALONG WITH COMPUTATION SHEETAND NOTICE OF DEMAND.15.3.2021 ALONG WITH COMPUTATION SHEETAND NOTICE OF DEMAND. EXHIBIT P6TRUE COPY OF THE NOTICE DATED 12.03.2021FOR THE A.Y. 2018-19 ISSUED BY THERESPONDENTFOR THE A.Y. 2018-19 ISSUED BY THERESPONDENT EXHIBIT P7 TRUE COPY OF ACTUAL COMPUTATION IN TERMSOF ITR ALONG WITH RE-CONCILIATION INTERMS OF 3CDOF ITR ALONG WITH RE-CONCILIATION INTERMS OF 3CD