TMI Blog2016 (2) TMI 1155X X X X Extracts X X X X X X X X Extracts X X X X ..... rves credence vis-a-vis both the assessment orders and cannot be by-passed in the peculiar facts and circumstances of the instant case. The verdict of Supreme Court in Chhabil Dass Agarwal (2013 (8) TMI 458 - SUPREME COURT ) clearly clinches the issue in favour of the Revenue. The ratio decidendi of this judgment can very well be pressed into service vis-avis both the writ petitions and consequently objection of the Revenue is liable to be sustained to non-suit the petitioner in both the petitions. Supreme Court in an earlier decision in Champalal Binanai V/s. The Commissioner of Income-tax, West Bengal & Ors. [1969 (12) TMI 3 - SUPREME Court], while considering availability of alternative remedy of appeal under the Income-tax Act, 1922, opined that before exhausting the said remedy, an assessee is not entitled to invoke extraordinary jurisdiction enshrined under Article 226 of the Constitution. The argument of learned counsel for the assessee that statutory remedy of appeal is illusory and harassing cannot be countenanced in the backdrop of facts and circumstances of these matters, especially when against the original assessment orders, petitioner-assessee has successfully a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment order dated 30th December, 2009 (Annex.1) and for Assessment Year 2008-09, assessment order was passed under Section 148/143(3) of the Act on 10th of November, 2010. Pertaining to Assessment Year 2007-08, petitioner s income was assessed to the tune of ₹ 7,68,55,600/- and interest was charged under Sections 234A, 234B and 234C, whereas for Assessment Year 2008-09 income was assessed to the tune of ₹ 6,41,29,650/- and interest was charged under Section 234A/B/C of the Act. Feeling contended with the assessment of income for both the assessment years, petitioner assailed both assessment orders, only to the extent of charging of interest under Section 234A/B/C of the Act, before the Commissioner of Income-tax (Appeals) and the learned appellate authority, while accepting appeals of the petitioner-assessee, waived the interest chargeable under aforesaid sections. Feeling dismayed with the aforesaid orders of CIT(A), the Income-tax Department went in appeal before the Income-tax Appellate Tribunal (ITAT), but effort of Department proved abortive and the learned ITAT affirmed the orders passed by CIT(A). As no challenge was laid against the orders passed by learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titions that there was no failure on her part to disclose fully and truly all material facts necessary for both the assessment years. Rejection of objections submitted by the petitioner by a vague, cryptic and non-speaking order is also set out a ground in the writ petitions to assail the impugned action of the respondent-Department. With a view to assail the impugned action of the respondent-Department, the petitioner has specifically pleaded in the writ petitions that she has reasons to believe that impugned notices were issued on audit objection just to thwart objections of the assessment getting barred by time. Simultaneously, the petitioner also pleaded that audit objections are dropped by the Department. Joining issue with the Department on merits of the case, petitioner-assessee has made an affirmative attempt to question the legality of disallowing land consolidation expenses of ₹ 52,04,000/- for Assessment Year 2007-08 vide Annex.9 and likewise for Assessment Year 2008-09 while issuing notice under Section 148 of the Act. The petitioner-assessee has set out a specific case that disallowing land consolidation expenses for Assessment Year 2007- 08 was a perverse and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st the show-cause notice is not maintainable. Availability of alternative efficacious statutory remedy of appeal under Section 246A of the Act is also pleaded in the return for non-suiting the petitioner-assessee. Referring to some of the legal precedents for buttressing this preliminary objection, the respondent-Department has specifically pleaded that when under a fiscal statute, hierarchy of remedy of appeals are provided, the party has to exhaust them instead of seeking relief by invoking jurisdiction under Article 226 of the Constitution of India. The respondent-Department has also justified its action by asserting with full emphasis that proceedings under Section 147/148 of the Act was initiated against the petitioner for both the assessment years with due application of mind upon finding that in both the assessment years certain income of the assessee has escaped assessment. In SBCW No.4532/2015, the Department has specifically pleaded that against the assessment order (Annex.9) remedy of appeal provided under the Act is very much available to the petitioner, and therefore, writ petition is not maintainable. As regards SBCW No.4531/2015, the respondent-Department has plea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory of such extraordinary powers when he has reason to believe that income of the assessee has escaped assessment and not otherwise. Assailing the reasons assigned for reopening of the assessment proceedings, learned senior counsel submits that the reasons are vague and cryptic not satisfying the requirements envisaged under Section 147 of the Act. Mr. N.M. Ranka learned senior counsel, while dilating on merits, would urge that land consolidation expenses for both the assessment years were considered by the AO and then income of the assessee was assesseed ought not to have been made subject-matter of alleged income escaping the assessment after final adjudication by the ITAT in this behalf. Learned counsel further submits that the AO, while issuing notices under Section 148 of the Act, has not been able to lay its hand on any extraneous material vis-a-vis land consolidation expenses for both the assessment years has conclusively rendered the notices vulnerable. Learned counsel contends that reopening of assessment proceedings cannot be resorted to by AO in want of tangible material by reappresial of same material, which was considered while passing initial assessment orders. Learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Income-tax Officer must have reason to believe that income, profits or gains chargeable to income-tax have been under-assessed. The second is that he must have also reason to believe that such under assessment has occurred by reason of either (i) omission or failure on the part of an assessee to make a return of his income under section 22, or (ii) omission or failure on the part of an assessee to disclose fully and truly all material facts necessary for his assessment for that year. Both these conditions are conditions precedent to be satisfied before the Incometax Officer could have jurisdiction to issue a notice for the assessment or re-assessment beyond the period of four years, but within the period of eight years, from the end of the year in question. While dilating on the duties casted on the assessee to disclose the material facts necessary for his assessment, the Court observed: ...It postulates a duty on every assessee to disclose fully and truly all material facts necessary for his assessment. What facts are material and necessary for assessment will differ from case to case. In every assessment proceeding, the assessing authority will, for the purpos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be constructively disclosed on the ground that with due diligence the Income-tax Officer could have discovered them from the facts actually disclosed. The Explanation has not the effect of enlarging the section, by casting a duty on the assessee to disclose inferences -to draw the proper inferences being the duty imposed on the Income-fax Officer. We have, therefore, come to the conclusion that while the duty of the assessee is to disclose fully and truly all primary relevant facts, it does not extend beyond this. ii. Commissioner of Income-tax V/s. (1) Kelvinator of India ltd. [(2010) 320 ITR 561 (SC)]. Supreme Court in this verdict, while taking note of the amendment under Section 147 of the Act w.e.f. 1st of April 1989, made endeavour for schematic interpretation of the words reason to believe' and opined in clear and unequivocal terms that mere change of opinion cannot be per se a valid reason to reopen the assessment proceedings. The Court held: On going through the changes, quoted above, made to section 147 of the Act, we find that, prior to the Direct Tax Laws (Amendment) Act, 1987, reopening could be done under the above two conditions and fulfill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Revenue under Section 260-A of the Act. Reiterating the principle that the words 'reason to believe' did not admit of conferment of arbitrary powers to the Assessing Officer to reopen assessment on the basis of mere change of opinion, the Court held: It is no longer res integra that a mere change in the opinion of the Assessing Officer after completion of the assessment under section 143(3) of the Act is not a legally approved determinant for valid initiation of reassessment proceeding under section 147 of the Act the essential and inviolable condition precedent therefor being the reason to believe that any income chargeable to tax has escaped assessment. Such a reason has to be essentially traceable to discoveries and satisfaction from new and hitherto unexplored sources and materials and not to a view of his own differently oriented on the basis of the same inputs, once considered and applied. The hon'ble apex court in CIT v. Kelvinator of India Ltd. (supra), while dwelling on this prescription of section 147 of the Act, enunciated that with the schematic interpretation of the words reason to believe did not admit of conferment of arbitrary powers to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruled in the backdrop of peculiar facts and circumstances of the case. The Court held: Lastly, adverting to the objection of the Revenue about availability of alternative remedy under section 246 and 246A of the Act, suffice it to state that its availability to a suitor is not an absolute bar to the invocation of the writ jurisdiction of the High Court under Article 226 of the Constitution and that without exhausting such alternative remedy a writ petition would not be maintainable. Constitutional powers vested in the High Court or the Supreme Court cannot be fettered by any alternative remedy available to the suitor. Injustice, whenever and wherever it takes place, has to be struck down as an ante-thema to the rule of law and the provisions of the Constitution. vi. Indian and Eastern Newspaper Society V/s. Commissioner of Income-tax, New Delhi [(1979) 119 ITR 996 (SC)] In this verdict, Supreme Court has held that opinion of an internal audit party of the Income-tax Department on a point of law cannot be regarded as information within the meaning of Section 147(b) of the Act for the purpose of re-opening an assessment. vii. Commissioner of Wealth-tax V/s. Kavira ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be discussed and the same shall be rendered at the instance of the higher authority who, as noticed hereinbefore, is a supervisory authority. It is one thing to say that while making the orders of assessment the Assessing Officer shall be bound by the statutory circulars issued by Central Board of Direct Taxes but it is another thing to say that the assessing authority exercising quasi-judicial function keeping in view the scheme contained in the Act, would lose its independence to pass an independent order of assessment. ix. Commissioner of Income-tax Calcutta V/s. Burlop Dealers Ltd. [(1971) 79 ITR 609 (SC)]. Supreme Court in this verdict while construing Section 34(1)(a) of the Indian Income-tax Act, 1922, observed that where on the evidence and materials produced during the original assessment proceedings, the Income-tax Officer could have reached a conclusion other than the one which he has reached, a proceeding under Section 24(1)(a) of the Income-tax Act, 1922 will not lie merely on the ground that the Income-tax Officer has raised an inference which he may later regard as erroneous. The Court held: The Income-tax Officer had, in consequence of informati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have reached a conclusion other than the one which he has reached, a proceeding under section 34(1)(a) will not lie merely on the ground that the Income-tax Officer has raised an inference which he may later regard as erroneous. The assessee had disclosed his books of account and evidence from which material facts could be discovered : it was under no obligation to inform the Income-tax Officer about the possible inferences which may be raised against him. It was for the Income-tax Officer to raise such an inference and if he did not do so the income which has escaped assessment cannot be brought to tax under section 34 (1)(a). x. Global Signal Cables (India) P. Ltd. V/s. Deputy Commissioner of Income-tax [(2014) 368 ITR 609 (Delhi). Division Bench of Delhi High Court in this verdict highlighted the condition precedent for issuance of notice of reassessment of income. Elaborating on this vital issue, the Court held: It is evident that while the assessing officer mentioned that income had escaped assessment because of the failure on the part of the assessee to fully and truly disclose the material facts for assessment, he has not indicated as to which material fact ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated in Rural Electrification Corporation Ltd. v. CIT [2013] 355 ITR 356 (Delhi). Also in Microsoft Corporation (I) Ltd v. Deputy CIT W.P.(C.) No.284/2013, decided on May 23, 2013) [2013] 357 ITR 50 (Delhi) a Division Bench of this court had observed as under (page 67): From the above, it is evident that merely having a reason to believe that income had escaped assessment is not sufficient for reopening the assessment beyond the four year period referred to above. It is essential that the escapement of income from assessment must be occasioned by the failure on the part of the assessee to, inter alia, disclose material facts, fully and truly. If this condition is not satisfied, there would be a bar to taking any action under Section 147 of the said Act. The facts of the present case are squarely covered by the decision of a Division Bench of this court in Swarovski India Ltd. v. Deputy CIT-W.P.(C.) 1909 of 2013, decided on August 8, 2014 since reported in [2014] 368 ITR 601 (Delhi) wherein the notice under section 148 of the said Act was quashed for being issued after the expiry of four years from the relevant assessment year wherein there was no specific mention of which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1977] 106 ITR 1 (SC), (6) Indian and Eastern Newspaper Society v. CIT [1979] 119 ITR 996 (SC) and (7) General Mrigendra Shum Sher Jung Bahadur Rana v. ITO [1980] 123 ITR 329 (Delhi). xii. Paladiya Brothers Co. V/s. Assistant Commissioner of Income-tax [(2015) 376 ITR 567 (Guj.)] Division Bench of Gujarat High Court in this verdict dilated on the condition precedent for reassessment and issuance of notice. The escapement of income must be occasioned by failure of assessee to disclose fully and truly all material facts is also emphasized in this verdict. The Court held:- Applying the decision of Division Bench of this court in the case of Niko Resources Ltd. (supra) as well as Gujarat Lease Financing Ltd. (supra), to the facts of the case on hand and as observed hereinabove, there does not appear to be failure on the part of the assessee to disclose truly and fully all material facts necessary for assessment with respect to the additional depreciation claimed, the initiation of the impugned reassessment proceedings which are initiated beyond the period of four years, are not permissible and the same cannot sustain and on that ground alone, the impugned reassessment pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isdictional requirements have to be satisfied cumulatively, wherever applicable. Therefore, even if one the numerous jurisdictional requirements necessary for the issue of reopening notice is not satisfied, the reopening of an assessment fails. The sustainability of the reopening notice would be tested only on the basis of the reason recorded at the time of issuing the notice. Therefore, the reasons recorded at the time of issuing notice is the only evidence of the Assessing Officer's reason to believe that income chargeable to tax has escaped assessment. These reasons cannot be added to, deleted from or supplemented. Besides when a notice for reassessment is challenged, the burden is on the Revenue to establish that the jurisdictional requirement stands satisfied. So far as the reason to believe on the part of the Assessing Officer is concerned, at the stage of issuing the notice only a prima facie and not a conclusive case of income escaping assessment should be established to turn down a challenge to the reopening notice. xiv. Commissioner of Income-tax V/s. Chhabil Dass Agarwal [2013] 357 ITR (SC) Supreme Court, while dealing with the statutory remedy, has laid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initiated under the Act and equally efficacious remedy of appeal is also provided under the Act, therefore, petitioner cannot be allowed to bypass the alternative efficacious remedy and both the writ petitions are liable to be rejected on this count alone. Mr. Bissa, with full emphasis at his command, has submitted that in Civil Writ Petition No.4532/2015, after reopening the assessment proceedings, impugned order (Annex.9) has also been passed which can very well be assailed by the petitioner by way of appeal under Section 246A of the Act, and therefore, petitioner cannot maintain this writ petition. While joining issue with the petitioner on Civil Writ Petition No.4531/2015, learned counsel contends that in case assessment order is passed for the Assessment Year 2008-09, the petitioner can very well avail alternative remedy and, at this stage, writ petition is not entertainable on wholly non-est and imaginary grounds and the petitioner is well within her right to furnish requisite material to prove the land consolidation expenses before AO during re-assessment proceedings. In substance, his submission is that writ petition as such is premature and no indulgence can be granted to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co. v. State of Haryana [1985] 3 SCC 267 this Court has noticed that if an appeal is from Caesar to Caesar's wife the existence of alternative remedy would be a mirage and an exercise in futility. In the instant case, neither has the assessee-writ petitioner described the available alternative remedy under the Act as ineffectual and non-efficacious while invoking the writ jurisdiction of the High Court nor has the High Court ascribed cogent and satisfactory reasons to have exercised its jurisdiction in the facts of instant case. In light of the same, we are of the considered opinion that the Writ Court ought not to have entertained the Writ Petition filed by the assessee, wherein he has only questioned the correctness or otherwise of the notices issued under Section 148 of the Act, the reassessment orders passed and the consequential demand notices issued thereon. ii. Akash Jain V/s. Assistant Commissioner of Income Tax Anr.- (S.B. Civil Writ Petition No.6448/2014) and Shubh Laxmi Buildcon Private Ltd. V/s. The Assistant Commissioner of Income Tax Anr. (S.B. Civil Writ Petition No.5477/2014), both decided on 25.05.2015. In both these orders, learned Single Judge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court held: We are concerned in all these cases not on the sufficiency of reasons on the part of the assessing officer for his belief at this stage. The legislative intent is to allow the assessing officer to go through the process of assessment. Even under Section 147 of the Act, a Court of law cannot presume a lack of jurisdiction, when a fact in issue requires an adjudication. It has to be exercised in terms of Sections 139, 143(2) and 143(3). Therefore, considering the scheme of the enactment, particularly, with reference to Sections 147 to 153 of the Act, we are of the view that an order passed on the objections of the assessee over adjudicating facts is not open to challenge by way of filing a writ petition. Learned counsels appearing for the petitioners submitted that the objections raised have not been considered properly by the assessing officer. It is also submitted that when a speaking order is required to be passed, the same is amenable to challenge. We are not able to countenance the said argument. We have already held that the order passed on a consideration of the objections raised cannot be termed as the order having civil consequences. The assessing officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or not. We have only to see whether there was prima facie some material on the basis of which the Department could reopen the case. The sufficiency or correctness of the material is not a thing to be considered at this stage. We are of the view that the court cannot strike down the reopening of the case in the facts of this case. It will be open to the assessee to prove that the assumption of facts made in the notice was erroneous. The assessee may also prove that no new facts came to the knowledge of the Income-tax Officer after completion of the assessment proceedings. We are not expressing any opinion on the merits of the case. The questions of fact and law are left open to be investigated and decided by the assessing authority. The appellant will be entitled to take all the points before the assessing authority. The appeals are dismissed. There will be no order as to costs. vi. GKN Driveshafts (India) Ltd. V/s. Income-tax Officer [2002] 125 TAXMAN 963 (SC). Supreme Court declined to interfere for adjudging validity of notice issued under Sections 148 and 143(2) of the Act. The Court held: We see no justifiable reason to interfere with the order under challenge. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this verdict did not find any infirmity in reopening of assessment proceedings under Section 147(6) of the Act on the basis of factual information given by the internal audit party. The Court held : We are of the view that both the Tribunal and the High Court were in error in holding that the information given by the internal audit party could not be treated as information within the meaning of Section 147(b). The audit party has merely pointed out a fact which has been overlooked by the Income Tax Officer in the assessment. The fact that the recognition granted to this Charitable Trust had expired on 22-9-1992 was not noticed by the ITO. This is not a case of information on a question of law. The dispute as to whether reopening is permissible after the audit party expresses an opinion on a question of law is now being considered by a larger Bench of this Court. There can be no dispute that the audit party is entitled to point out a factual error or omission in the assessment. Reopening of the case on the basis of a factual error pointed out by the audit party is permissible under law. In view of that we hold that reopening of the case under Section 147(b) in the facts of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO is without application of mind when it is solely on the basis of audit report. The Court held: The main contention of the petitioner is that there is no failure on the part of the petitioner in not disclosing fully and truly all materials facts necessary for the assessment year under consideration and in the absence of the same, the assumption of jurisdiction by the respondent under Section 147 of the Act, after expiry of four years from the end of the relevant assessment year, is illegal and invalid and thereby, the impugned proceeds cannot be sustained. This contention raised on behalf of the petitioner, in my considered opinion, is fallacious and has no force at all. It is curious enough to note that as observed above, in the original returns filed by the petitioner on 30.09.2008, the petitioner had not at all disclosed fully or truly all material facts regarding the income, viz., unabsorbed depreciation and business loss and depreciation, which the Assessing Officer has reason to believe that the same has escaped assessment within the meaning of Section 147 of the Act. Therefore, when admittedly, the material which is the subject-matter of the proceedings under Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resorted beyond the period of four years. As regards the contention that the reassessment based on audit report without independent application of mind by the Assessing Officer is not sustainable, is concerned, I do not find any force in the said contention since the respondent has given cogent reasons in his speaking order, dated 12.1.2015 while rejecting the objections raised by the petitioner, for reopening of the assessment and therefore, it cannot be stated that the respondent has not applied his mind and solely resorted to base on the audit report. In fact, the audit party is entitled to point out a factual error or omission in the assessment and it is settled law that reopening of the case on the basis of a factual error pointed out by the audit party is permissible under law. It has been held so in the case of CIT v. P.V.S.Beedies [1999] 237 ITR 13/103 Taxman 294 (SC), wherein, the Hon'ble Supreme Court has held as under: The dispute as to whether reopening is permissible after audit party expresses on opinion on a question of law is now being considered by a larger Bench of the Supreme Court. There can be no dispute that the audit party is entitled to point out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved by it for the goods exported. If the true price has not been disclosed and there was under-invoicing, the logical conclusion prima facie is that there has been failure on the part of the appellant to disclose fully and truly all material facts before the ITO. We are, therefore, satisfied that both the conditions required to attract the provisions of section 147(a) have been complied with in this case. I have heard learned counsel for the parties; perused the requisite materials available on record in both the petitions and bestowed consideration to the legal precedents cited at Bar by the rival parties. The significant question, which has cropped up in both these petitions, is clear and explicit. The rival parties have different perceptions concerning the power of AO for reopening of assessment proceedings. The Legislature in Chapter-XIV of the Act has prescribed procedure for assessment. Section 147 deals with power and jurisdiction of the AO to reopen assessment proceedings, when he has reason to believe that any income chargeable to tax has escaped assessment for any assessment year subject to the provisions of Sections 148 to 153 of the Act. Section 147 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Section 147 of the Act makes it amply clear that emphasis is on the words reason to believe . While construing these words reason to believe , the consistent view of the law courts is that these words did not admit of conferment of arbitrary powers to the Assessing Officer to reopen assessment on the basis of mere change of opinion. The Assessing Officer, while construing these words to exercise powers under Section 147 of the Act, may act on direct or circumstantial evidence but not on mere suspicion, gossip or rumor. The belief must be held in good faith; it cannot be a mere pretence. With the passage of time, the legal precedents have also dilated on the relevant material on the strength of which the AO can form an opinion that he has reason to believe that any income of the assessee chargeable to tax has escaped assessment. The requisite material, in this behalf, has to be tangible and not founded on reappraisal of the same material. Assessing Officer, for the purpose of taking recourse to reassessment proceedings, is not expected to give undue credence to the opinion rendered by the internal audit party for the purpose of its belief, in this behalf, as required under S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re activity relates to M/s PACL India Limited. Therefore, the expenditure of ₹ 1,02,04,000/- debited in the P/L Account on the basis of this activity was not an allowable expenditure to the assessee. Hence, I have reason to believe that the income of ₹ 1,02,04,000/- is escaped income for the A.Y. 2007-08. The Notice is hereby issued with prior recording of the reasons and after taking necessary approval as per the Income tax Act 1961. Similarly, for the Assessment Year 2008-09, a show cause notice is issued, which reads as under: Please refer the Assessment Order in your case of the A.Y. 2008-09. In this case, you have claimed a land consolidation expenses of ₹ 60,27,000/-. How, the same is allowable expense? Produce complete details of the same before this office. Further the PACL India Limited has also denied the Agreement between your good self and that of your good self. In the light of the same, Please enlighten the same as to how same is verifiable and acceptable. You are requested to submit the reply for the same to this office by 16.03.2015. Hence, you are hereby requested to co-operate with the department and furnish the necessary evidences s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rehend that the petitioner-assessee, for claiming land consolidation expenses vis-a-vis both the assessment years, has not candidly disclosed fully and truly all material facts necessary for the assessment years of these years. It is noteworthy that the original assessment order made under Section 143(3) of the Act for the Assessment Year 2007-08 was not assailed by the Revenue and the assessee, while agreeing with the total income assessed, simply laid appeal on the interest charged and the same is reduced by the ITAT by its order dated 14th December, 2012. Even no mistake in the assessment order was noticed under Section 154 of the Act. Similarly, for the Assessment Year 2008-09, original assessment order was assailed by the assessee before the Commissioner of Income-tax (Appeals), Jodhpur to question disallowing expenditure of a sum of ₹ 20,00,000/- shown in the Profit Loss Account of assessee by the assessing authority and the said appeal was allowed by the appellate authority and eventually the order of the appellate authority was also upheld by the ITAT. The entire checkered history of both the cases undeniably persuaded this Court to believe that case of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come of the appeal under Sections 246/246A of the Act is not productive for the assessee. The jurisdiction and powers of the appellate authority under the Act are very wide so as to examine the legality and propriety of the impugned action of the AO and the consequential orders. Appellate authority, while exercising its jurisdiction, can take care of about the grievance of the assessee in right perspective and if feel persuaded can very well redress. Though in S.B. Civil Writ Petition No.4531/2015 i.e. for the Assessment Year 2008-09, fresh assessment order by AO has not been passed under Section 147/143(3) of the Act but the bone of contention for reopening of the assessment remains the same i.e. land consolidation expenses whether allowable or not to the assessee. Therefore, the objection of the Revenue about availability of alternative, efficacious remedy deserves credence vis-a-vis both the assessment orders and cannot be by-passed in the peculiar facts and circumstances of the instant case. The majority judgment of the Supreme Court in Calcutta Discount Co. Ltd. (supra) is clearly distinguishable inasmuch as, in that case, during the pendency of the writ petition challen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Article 226 of the Constitution. The Court held: Before parting with the case we deem it necessary once more to emphasize that the Income-tax Act provides a complete and self-contained machinery for obtaining relief against improper action taken by the departmental authorities, and normally the party feeling himself aggrieved by such action cannot be permitted to refuse to have recourse to that machinery and to approach the High Court directly against the action. The assessee had an adequate remedy under the Incometax Act which he could have availed of. He, however, did not move the Income-tax Appellate Tribunal which was competent to decide all questions of fact and law which the assessee could have raised in the appeal including the grievance that he had not adequate opportunity of making his representation and invoked the extraordinary jurisdiction of the High Court. In our judgment no adequate ground was made out for entertaining the petition. A writ of certiorari is discretionary; it is not issued merely because it is lawful to do so. Where the party feeling aggrieved by an order of an Authority under the Income-tax Act has an adequate alternative remedy which he may reso ..... X X X X Extracts X X X X X X X X Extracts X X X X
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