TMI Blog2018 (10) TMI 1731X X X X Extracts X X X X X X X X Extracts X X X X ..... l disputes is not warranted so as to interfere with the proceedings so initiated. Writ petition is held to be not maintainable. The petitioners have efficacious remedies available under the Act which they have every right to exhaust. The disposal of this writ petition, the observations made hereinabove, shall be without prejudice to the rights of the petitioners in contesting the matter before available forum including appellate forum. - W. P. (C) No. 279 of 2015. - - - Dated:- 23-10-2018 - Mohammad Yaqoob Mir C. J. And S. R. Sen J. For the Petitioners : V. K. Jindal, Senior Advocate with Ms. P. Biswakarma, Advocate For the Respondents : S. Saikia, Advocate JUDGMENT MOHAMMAD YAQOOB MIR C. J. - 1. By medium of this petition under article 226 of the Constitution of India, the petitioners seek quashment of notice dated July 10, 2014 issued by the Assistant Commissioner of Income-tax under section 148 of the Income-tax Act, 1961 (hereinafter referred to as the Act ), the Note Sheet dated June 25, 2014, wherein reasons are recorded by the Assessing Officer (hereinaf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act is subject to sanction in terms of section 151 of the Act which too is subject to satisfaction of the Chief Com missioner or Commissioner on the reasons recorded by the Assessing Officer. Requisite sanction has been granted by the Commissioner. (C) Writ petition is not maintainable because the petitioners have efficacious remedies available, i.e., remedy of appeal as against reassessment before the Deputy Commissioner (Appeals), then before the Appel late Tribunal and then before the High Court under sections 246, 253 and 260A of the Act respectively. 4. For appreciating the respective contentions in their right perspective, precise flashback of the background of the case is imperative. Petitioner No. 1, North Eastern Electric Power Corporation Limited (NEEPCO Ltd.), is a Government of India Public Sector Enterprise, incorporated under the Companies Act, 1956, under the Certificate of incorporation No.1658 of 1976-77 issued by the Registrar of Companies (ROC), Shillong, having its registered and head office at Brookland Compound, Lower New Colony, Shillong, Meghalaya. Petitioner No. 2 is the General Manager (Finance) looking af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 26, 2011 under section 143(3) of the Act. 8. After expiry of four years from the end of the relevant assessment year 2009-10, the Assessing Officer (respondent No. 2) issued impugned notice vide No. PAN : AAACN999IJ/256 dated July 10, 2014 under section 148 of the Act alleging therein that the Assessing Officer has reason to believe that income of the petitioners chargeable to tax for the assessment year 2009-10 has escaped assessment within the meaning of section 147 of the Act. As such, he (AO) proposed to reassess the income for the said assessment year. Notice according to the Assessing Officer was issued after obtaining satisfaction of the Commissioner of Income-tax. 9. In response to the notice dated July 10, 2014, the petitioner-Corporation requested the Assessing Officer to communicate the reasons for reassessment under section 147 of the Act after expiry of four years from the end of the relevant year. In response to the said letter, the Assessing Officer conveyed to the petitioner-Corporation that Income-tax Department software did not accept the old return. Therefore, the petitioner-Corporation shall file a new return in online the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 2581.63 lakhs was spent on Tuirial Hydro Electric Project during construction period and interest and finance charges were debited to the revenue as per mercantile practice. Credit on the said expenditure was claimed and allowed by the Assessing Officer at the time of scrutiny/regular assessment. Then, in paragraph 26 of the petition, it has been stated that at the time of passing the regular assessment order, in paragraph 12 of the notes on accounts of the 33rd Annual Report 2008-09, it was categorically stated that the Innovation and Entrepreneurship Development Centre expenses have been charged to the revenue in line with the accounting policy and in compliance with Accounting Standard-16. Therefore, the basis were disclosed and accepted by the Assessing Officer. The fact that Tripura Gas Based Power Project was abandoned by the Ministry of Power was also disclosed. The observation of the Assessing Officer about revival of Tripura Gas Based Power Project is wrong as the project was not revived. 13. In opposition, the respondents have made it clear that Tripura Gas Based Power Project was not revived. The record clearly reveals that Tripura G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... since four years have already lapsed therefore, the case is to be put up to the Commissioner of Income-tax for approval for issuance of notice under section 148 of the Act . 15. What emerge from the note sheet of the Assessing Officer is that the petitioners-assessees though had disclosed the position about the said amount but had wrongly shown it as expenditure as such, ₹ 2581.63 lakhs has escaped assessment. 16. The contention of the petitioners that the petitioners had disclosed all material facts fully and truly and the same have been considered by the Assessing Officer while doing the final assessment, leaves no scope for reopening. Disclosure, in view of the office note of the Assessing Officer, is not in tune with the requirement, i.e., full and true disclosure. 17. True it is that the position of the account(s) which includes ₹ 2581.63 lakhs was looked into by the Assessing Officer during regular assessment which was completed. But the question is as to whether disclosure by the assessee-company for the assessment was full and true. The words fully and truly assume significance because disclosure of all mate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icacious remedies are available to the petitioners. In order to make it more clear, it shall be relevant to mention that after reassessment order is passed by the Assessing Officer, as against that order the petitioners have a remedy of appeal under section 246 of the Act before the Deputy Commissioner (Appeals) thereafter, an appeal before the Appellate Tribunal and then in terms of section 260A against the order passed by the Tribunal before the High Court. Before the Deputy Commissioner (Appeals) and then Appellate Tribunal, the petitioners can agitate all factual as well as legal points. To sideline those efficacious remedies in the given facts and circumstances is unwarranted. 21. It is also the contention of the learned counsel for the respondents that as per the High Court of Meghalaya Rules, 2013 notified vide Notification No. HCM.II/430/2013/553 dated February 27, 2014 under Chapter-III, the petitioners were required to record an averment in the petition to the following fact : That the humble petitioner has no other adequate and alternative remedy and the remedy sought for is complete and adequate. 22. In the writ pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 147 of the Act by the Assessing Officer satisfy the test as laid down. 26. Next, the learned counsel for the petitioners while relying on the judgment reported in CIT v. A. Raman and Co. [1968] 67 ITR 11 (SC) ; [1968] AIR 1968 SC 49, contended that the writ petition is maintainable. Para 6 of the judgment is advantageous to be quoted (page 15 of 67 ITR) : The High Court exercising jurisdiction under article 226 of the Constitution has power to set aside a notice issued under section 147 of the Income-tax Act, 1961, if the condition precedent to the exercise of the jurisdiction does not exist. The court may, in exercise of its powers, ascertain whether the Income-tax Officer had in his possession any information : the court may also determine whether from that information the Income-tax Officer may have reason to believe that income chargeable to tax had escaped assessment. But the juris diction of the court extends no further. Whether on the information in his possession he should commence a proceeding for assessment or reassessment must be decided by the Income-tax Officer and not by the High Court. The Income-tax Officer alone is entrusted with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Oil Corporation Ltd. [2003] 2 SCC 107 ; State of H. P. v. Gujarat Ambuja Cement Ltd. [2005] 6 SCC 499 ; [2005] 142 STC 1 (SC)). The Constitution Benches of this court in K. S. Rashid and Son v. Income-tax Investigation Commission [1954] 25 ITR 167 (SC) ; AIR 1954 SC 207 ; Sangram Singh v. Election Tribunal, Kotah, AIR 1955 SC 425 ; Union of India v. T. R. Varma, AIR 1957 SC 882 ; State of U. P. v. Mohd. Nooh, AIR 1958 SC 86 and K. S. Venkataraman and Co. (P.) Ltd. v. State of Madras [1966] 60 ITR 112 (SC) ; AIR 1966 SC 1089 have held that though article 226 confers very wide powers in the matter of issuing writs on the High Court, the remedy of writ absolutely discretionary in character. If the High Court is satisfied that the aggrieved party can have an adequate or suitable relief elsewhere, it can refuse to exercise its jurisdiction. The court, in extraordinary circumstances, may exercise the power if it comes to the conclusion that there has been a breach of the principles of natural justice or procedure required for decision has not been adopted. (See : N. T. Veluswami Thevar v. G. Raja Nainar, AIR 1959 SC 422 ; Municipal Council, Khurai v. Ka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... J. in Wolverhampton New Waterworks Co. v. Hawkesford, 141 ER 486 in the following passage (ER page 495) : '... There are three classes of cases in which a liability may be established, founded upon a statute... But there is a third class, viz., where a liability not existing at common law is created by a statute which at the same time gives a special and particular remedy for enforcing it... The remedy provided by the statute must be followed, and it is not competent to the party to pursue the course applicable to cases of the second class. The form given by the statute must be adopted and adhered to.' The rule laid down in this passage was approved by the House of Lords in Neville v. London Express Newspapers Ltd. [1919] AC 368 (HL) and has been reaffirmed by the Privy Council in Attorney General of Trinidad and Tobago v. Gordon Grant and Co. Ltd. [1935] AC 532 (PC) and Secretary of State v. Mask and Co., AIR 1940 PC 105. It has also been held to be equally applicable to enforcement of rights, and has been followed by this court throughout. The High Court was therefore justified in dismissing the writ petitions in limine. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts fully and truly by the assessee is apparent. Assertion and denial by the parties in this behalf give rise to disputed questions of fact. Notice under section 148 of the Act has been issued after sanction under section 151 of the Act. At this stage no breach or non-compliance with sections 147, 148 and 151 of the Act is forthcoming. However, it gives rise to factual dispute. There is no jurisdictional error, or lack of jurisdiction forthcoming at this stage. Against reopening of assessment for the assessment year 2009-10, statutory efficacious remedies under the Act are available which cannot be allowed to be sidelined, exercise of jurisdiction under article 226 of the Constitution in the background of the factual disputes is not warranted so as to interfere with the proceedings so initiated. 29. In the background of the facts and circumstances as in detail stated hereinabove, and the law laid down by the hon'ble apex court as referred to above, the writ petition is held to be not maintainable. The petitioners have efficacious remedies available under the Act which they have every right to exhaust. The disposal of this writ petition, the observations made ..... X X X X Extracts X X X X X X X X Extracts X X X X
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