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TMI Blog2020 (1) TMI 356X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the interest of justice; (d) to provide for the cost of this petition." 2 The facts giving rise to this writ application may be summarised as under: 2.1 The writ applicant seeks to challenge the order passed by the respondent under Section 143(3) read with Section 254 of the Income Tax Act, 1961 (for short, 'the Act, 1961') for the assessment year 20042005. The assessee is a company incorporated under the Companies Act, 1956. The assessee is in the business of construction. The return of the income for the year under consideration was filed on 1st November 2004 declaring total income at Rs. 11,16,785/( Rupees Eleven Lakh Sixteen Thousand Seven Hundred Eighty Five only) and the same was processed under Section 143(1) of the Act. 2.2 The case of the assessee came to be selected for scrutiny and various details were called for by the Assessing Officer. In such circumstances, the best judgement assessment came to be framed under Section 144 of the Act vide order dated 8th December 2006 assessing the income of the assessee at Rs. 1,25,93,920/( Rupees One Crore Twenty Five Lakh Ninety Three Thousand Nine Hundred Twenty only) in view of the provisions of Section 44A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... back before the Tribunal to permit the appellant to file application for condonation of delay. This shall, however, be subject to following conditions that the appellant :1) shall deposit sum of Rs. 5000/with the Gujarat State Legal Services Authority latest by 31.12.2012; 2) shall file appropriate application for condonation of delay before the Tribunal also latest by the said date. Appeal is disposed of accordingly." 2.5 The Appellate Tribunal partly allowed the appeal preferred by the writ applicant herein holding as under: "6 We have carefully perused the contents of the application for condonation of delay along with the affidavit. In our considered opinion, the assessee prevented by reasonable and sufficient cause for not filing the appeal on time. Therefore, in the interest of Justice and fair play, the delay is condoned. 7. Coming to the merits of the case, we find that the assessment order was made ex parte u/s. 144 of the Act which was confirmed by the ld. CIT(A). 8. A perusal of the order of the authorities below shows that because of non attendance by the assessee, the A.O. proceeded by applying rate of 8% following guidelines of Section 44AD of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion as discussed in para 10.3 94,317/ On account of disallowance of trade payable as discussed in para 11 1,28,38,395/ 5,37,67,745/ Assessed income 5,48,84,530/ 13 Assessed u/s. 143(3) r.w.s. 254 of the Income Tax Act, 1961. Give credit for prepaid taxes, after the verification. Charge interest u/s. 234A, u/s.234B, 234C & 234D of the I.T. Act, 1961 as applicable. Issued show cause notice u/s. 274 r.w. Section 271(1)(c) of the Act. Issue demand notice and challan accordingly." 6 Being dissatisfied with the order passed by the Assessing Officer, the assessee is here before this Court with the present writ application. SUBMISSIONS ON BEHALF OF THE WRIT APPLICANT: 7 Mr. Hemani, the learned senior counsel assisted by Ms. Vaibhavi K. Parikh, the learned counsel appearing for the writ applicant vehemently submitted that the impugned order passed by the Assessing Officer is without jurisdiction. The learned senior counsel would submit that what cannot be done directly could not have been done indirectly. It is submitted that the order of the Tribunal remitting the matter, more particularly, the last part of the direction is very specific and clear. Accord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies and having gone through the materials on record, the following two questions fall for our consideration: [1] Whether we should entertain this writ application in view of the fact that there is an alternative remedy available to the writ applicant by preferring an appeal before the CIT (Appeals)? [2] If we take the view that this writ application is maintainable, then whether the impugned order passed by the Assessing Officer is sustainable in law? 13 Having regard to the basic infirmity in the impugned order passed by the Assessing Officer, we are of the view that we should not reject this writ application only the ground that the writ applicant has an alternative efficacious remedy of preferring an appeal before the CIT (Appeals). In this context, we may refer to a decision of the Supreme Court in the case of Commissioner of Income Tax vs. Chhabil Dass Agarwal [2013] 357 ITR 357 (SC). We rely upon the observations made in paras 15 to 20. The same reads thus: "15. Before discussing the fact proposition, we would notice the principle of law as laid down by this Court. It is settled law that nonentertainment of petitions under writ jurisdiction by the High Court when a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ap Singh vs. State of Haryana, (2002) 7 SCC 484 and GKN Driveshafts (India) Ltd. vs. ITO, (2003) 1 SCC 72). 17. In Nivedita Sharma vs. Cellular Operators Assn. of India, (2011) 14 SCC 337, this Court has held that where hierarchy of appeals is provided by the statute, party must exhaust the statutory remedies before resorting to writ jurisdiction for relief and observed as follows: "12. In Thansingh Nathmal v. Supdt. of Taxes, AIR 1964 SC 1419 this Court adverted to the rule of selfimposed restraint that the writ petition will not be entertained if an effective remedy is available to the aggrieved person and observed: (AIR p. 1423, para 7). "7. ... The High Court does not therefore act as a court of appeal against the decision of a court or tribunal, to correct errors of fact, and does not by assuming jurisdiction under Article 226 trench upon an alternative remedy provided by statute for obtaining relief. Where it is open to the aggrieved petitioner to move another tribunal, or even itself in another jurisdiction for obtaining redress in the manner provided by a statute, the High Court normally will not permit by entertaining a petition under Article 226 of the Constituti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SC 192; CCE v. Dunlop India Ltd., (1985) 1 SCC 260; Ramendra Kishore Biswas v. State of Tripura, (1999) 1 SCC 472; Shivgonda Anna Patil v. State of Maharashtra, (1999) 3 SCC 5; C.A. Abraham v. ITO, (1961) 2 SCR 765; Titaghur Paper Mills Co. Ltd. v. State of Orissa, (1983) 2 SCC 433; H.B. Gandhi v. Gopi Nath and Sons, 1992 Supp (2) SCC 312; Whirlpool Corpn. v. Registrar of Trade Marks, (1998) 8 SCC 1; Tin Plate Co. of India Ltd. v. State of Bihar, (1998) 8 SCC 272; Sheela Devi v. Jaspal Singh, (1999) 1 SCC 209 and Punjab National Bank v. O.C. Krishnan, (2001) 6 SCC 569) 18. In Union of India vs. Guwahati Carbon Ltd., (2012) 11 SCC 651, this Court has reiterated the aforesaid principle and observed: "8. Before we discuss the correctness of the impugned order, we intend to remind ourselves the observations made by this Court in Munshi Ram v. Municipal Committee, Chheharta, (1979) 3 SCC 83. In the said decision, this Court was pleased to observe that: (SCC p. 88, para 23). "23. ... when a revenue statute provides for a person aggrieved by an assessment thereunder, a particular remedy to be sought in a particular forum, in a particular way, it must be sought in that forum and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x, imposition of penalty and for obtaining relief in respect of any improper orders passed by the Revenue Authorities, yet the remedy under the statute, however, must be effective and not a mere formality with no substantial relief. It is true that when a statutory forum is created by law for redressal of grievance, a writ petition should not be entertained ignoring the statutory dispensation. But, such principles, in a given case, may be given a go bye, if the Court is convinced that on the face of it, the impugned order is not sustainable in law. We are of the view that we should look into the matter on merits while overruling the preliminary objection raised on behalf of the Revenue. 15 We are convinced that the impugned order passed by the Assessing Officer is not sustainable in law. We once again fall back on the directions issued by the Appellate Tribunal. The directions are plain and simple. The Tribunal takes the view that Section 44AD of the Act is not applicable. It directed the assessee to attend the assessment proceedings and justify its case on lower rate of profit in accordance with its books of account. The Assessing Officer was directed to verify the same and deci ..... 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