Over 2 lakh Indian cases. Search powered by Google!

Case Details

AJAY KUMAR MAHESHWARI versus INCOME TAX OFFICER, WARD

High Court of Judicature at Allahabad

Case Law Search

Indian Supreme Court Cases / Judgements / Legislation

Judgement


Ajay Kumar Maheshwari v. Income Tax Officer, Ward-Bijnor - WRIT TAX No. 540 of 2001 [2006] RD-AH 7657 (13 April 2006)

 

This is an UNCERTIFIED copy for information/reference. For authentic copy please refer to certified copy only. In case of any mistake, please bring it to the notice of Joint Registrar(Copying).

HIGH COURT OF JUDICATURE OF ALLAHABAD

Reserved

Civil Misc. Application No.107827 of 2005

IN

Civil Misc. Review Application No.107829 of 2005

And

Civil Misc. Review Application No.107829 of 2005

IN

Civil Misc. Writ Petition No.540 of 2001

Ajay Kumar Maheshwari v. Income Tax Officer,

Ward Bijnor

Hon'ble R.K.Agrawal, J.

Hon'ble Prakash Krishna, J.

(Delivered by R.K.Agrawal, J.)

The applicant, Ajay Kumar Maheshwari, by means of Civil Misc. Writ Petition No.540 of 2001 filed under Article 226 of the Constitution of India had challenged the validity of the notice dated 15.3.2001 issued under Section 148 of the Income Tax Act, 1961 (hereinafter referred to as "the Act") for the assessment year 1995-96 on the ground that the said notice is absolutely illegal, arbitrary and had been issued only on account of change of opinion and there was no material on the basis of a sum of Rs.21.54 lacs can be said to be the income of the applicant on the basis of which an opinion can be formed about the escaped assessment. The writ petition was heard alongwith three others writ petitions involving similar issues and was dismissed vide a common judgment and order dated 3.12.2004. The Court had held that there was relevant material before the Income Tax Officer to form the reasonable belief that the income had escaped assessment. The challenge to the validity of the notice issued under Section 148 of the Act was repelled by the Court. The applicant challenged the judgment and order dated 3.12.2004 passed by this Court before the Hon'ble Apex Court by filing Petition for Special Leave to Appeal (Civil) No.7020 of 2005 which came up for consideration before the Hon'ble Apex Court on 11.4.2005. The applicant sought permission to withdraw the Special Leave Petition, which was granted. The Apex Court has passed the following order :-

"Learned senior counsel appearing for the petitioner, inter alia, submits that under Section 151 of the Income Tax Act the assessment if to be reopened then the same can be done only after the permission is obtained from the Chief Commissioner which has not been done in these cases. He also submits that the reopening can only be done by an officer not below the rank of Joint Commissioner. From the impugned judgment we do not find that this issue has been raised before the Tribunal. However, the learned senior counsel points out from the grounds of the SLP that such grounds have been raised but not reflected in the judgment. If that be so, the appropriate remedy for the petitioners is to approach the High Court by way of Review Petition to point out these deficiencies.

Learned counsel seeks permission to withdraw these petitions. Prayer is granted. The special leave petitions are dismissed as withdrawn."

Thereafter, the applicant had filed the present application seeking review of the judgment and order dated 3.12.2004 alongwith an application seeking condonation of delay in filing the review application. The review application has been filed on the following grounds:-

(i) Section 151(2) of the Act would show that no notice under Section 148 of the Act could be issued in case where an assessment have been made under Section 143(3) by an Assessing Officer who is below the rank of an Assistant  Commissioner or Deputy Commissioner unless the Joint Commissioner is satisfied on the reasons recorded that it is a fit case for issue of such notice. Further, the proviso to Section 151(1) the assessment order provides that after the expiry of four years from the end of the relevant assessment year, no such notice shall be issued unless the Chief Commissioner or the Commissioner is satisfied on reasons recorded that it is a fit case for issue of notice;

(ii) Admittedly, as four years had expired after the end of the assessment year 1995-96, prior to the issue of notice under Section 148, and no sanction or satisfaction was recorded or obtained by the Chief Commissioner or the Commissioner prior to the issue of the notice by the Assessing Officer and, therefore, the proceedings for re-assessment were void and completely without jurisdiction; and

(iii) The aforesaid points were raised before this Court at the time of hearing of the writ petition by the Senior Counsel, Sri V.B.Upadhaya and the fact is also highlighted in paragraphs 3(a) and (b) of the rejoinder affidavit which issues of jurisdiction were unadjudicated by this Court.

In the counter affidavit filed by Sri Subhash Chandra Saxena, Income Tax Inspector, Ward I, Income Tax Office, Bijnor, it has been stated that the petitioner's counsel did not raise the plea of jurisdiction before this Court and it is not open to him to raise this plea from back door in review application.

In reply to the counter affidavit filed in the review application, it has been reiterated that the aforesaid plea was taken in the rejoinder affidavit of the writ petition. It has further been stated that the Hon'ble Apex Court in its order dated 11.4.2005 had permitted the petitioner to raise this plea by means of a review application.

We have heard Sri V.B.Upadhaya, learned senior counsel, assisted by Sri Rakesh Ranjan Agrawal, Advocate, on behalf of the applicant, and Sri Shambhoo Chopra, learned standing counsel appearing on behalf of the Revenue.

Sri Upadhaya, learned senior counsel, submitted that the plea regarding sanction for issue of notice not having been given by the Joint Commissioner, was specifically raised by him in the course of the arguments which plea had not been dealt with by this Court while dismissing the writ petition vide judgment and order dated 3.12.2004. According to him, sanction in the case has been given by the Additional Commissioner of Income Tax and, therefore, the sanction did not meet the requirement of sub-section (1) of Section 151 of the Act. Sri Upadhaya further submitted that in the present case assessment for the assessment year 1995-96 was framed under Section 143(3) of the Act and, therefore, in view of the provision of sub-section (1) of Section 151 of the Act, notice under Section 148 of the Act could not have been issued unless the Chief Commissioner or the Commissioner is satisfied on the reasons recorded by the Assessing Officer that it is a fit case for issue of such notice and as in the present case no satisfaction of the Commissioner or the Chief Commissioner has been recorded, the notice could not have been issued at all.

Sri Upadhaya further submitted that even assuming without admitting that the plea regarding satisfaction of the Commissioner or the Chief Commissioner on the reasons recorded by the Assessing Officer that it is a fit case for issue of notice under Section 148 has not been raised at the time of arguments when the writ petition was heard, the same being apparent from record of the writ petition, i.e., from a bare perusal of the notice in question itself, the Court should not decline to entertain such a plea as it does not involve any fresh investigation of facts and being a pure question of law ought to be decided.

Sri Shambhoo Chopra, learned Standing Counsel, however, submitted that the plea regarding sanction having not been given by the Joint Commissioner or the satisfaction of the Chief Commissioner or the Commissioner having not been recorded, was not raised before this Court at the time of arguments and, therefore, it is not open to the applicants to seek review of the judgment and order of this Court on points which were not raised.

Before adverting to the various pleas raised by the learned counsel for the parties, we deem it fit and proper and in the interest of justice to condone the delay in filing the review application as the grounds given in the application seeking condonation do make out sufficient cause. We accordingly condone the delay in filing the review application.

Coming to the merits of the review application including its maintainability, we find that Sri Upadhaya is correct that the plea that the Joint Commissioner had not granted sanction to the issuance of the notice under Section 148 was raised by him during the course of the arguments. However, we find from our notes that the Court had specifically pointed out to the learned counsel for the applicant that there was no averment in the writ petition regarding sanction having been granted by the Additional Commissioner and not by the Joint Commissioner nor there was any averment assailing the notice for non-fulfillment of the provisions of Section 151(2) of the Act. When this fact was pointed out, the learned senior counsel appearing for the petitioner did not refer to the averments made in the rejoinder affidavit which was filed before the Court on 29.10.2004 and the arguments were heard on 5.11.2004. It may be mentioned here that in paragraph 3 of the rejoinder affidavit filed by Ajay Kumar Maheshwari in the writ petition the averments have been made as follows :-

"3. That before giving parawise reply to the counter affidavit the deponent craves the leave of this Hon'ble Court to place certain more facts, which are essential for just appreciation of the controversy involved in the instant case.

(a) That it is submitted that the notice under Section 148 of the Income Tax Act is illegal as the Income Tax Officer, Ward Bijnor has no jurisdiction to issue such notice to the petitioner. Section 151(1) of the Income Tax Act prescribes procedure where the assessment under Section 143(3) has been made and the notice under Section 148 of the Act shall not be issued by the Assessing Officer, who is below the rank of the Assistant Commissioner of Income Tax or the Dy. Commissioner of Income Tax. Section 116 of the Income Tax Act prescribes various Tax Authorities wherein Income Tax Officer Assistant Commissioner of Income Tax or Deputy Commissioner of Income Tax are separately defined. In such circumstances reassessment proceedings initiated by the respondent against the petitioner is wholly without jurisdiction illegal and liable to be quashed.

(b) That the action of the respondent under Section 148 of the Act is also without jurisdiction on the ground that since four years from the relevant assessment years have already been expired as such initiation of proceedings under Section 148 of the Income Tax Act can be resorted to only after obtaining the satisfaction of the Chief Commissioner or Commissioner of Income Tax whereas in the present case, upon a perusal of the reasons recorded, it is apparent that Income Tax Officer concerned has sent the proposal to the Additional Commissioner of Income Tax for his sanction under Section 151 of the Act.

(c) That it may be stated here that upon perusal of the reasons dated 15.3.2001 (Annexure no.2 to the writ petition), it is apparent that the Income Tax Officer prior to receiving/obtaining the sanction, had initiated the proceedings under Section 148 of the Income Tax Act, which is contrary to the proviso to Section 151(1) of the Act, as such the proceedings for re-assessment are illegal and liable to be quashed."

It may also be mentioned here that the aforesaid plea regarding non-compliance of the provisions of Section 151(1) of the Act and the sanction not being given by the Joint Commissioner was taken for the first time in the rejoinder affidavit which was filed about a week before the arguments were heard (rejoinder affidavit having been filed on 29.10.2004 and the arguments having been heard on 5.11.2004) there was no occasion or opportunity to the Revenue to meet out the new plea which was taken for the first time in the rejoinder affidavit. Thus, the applicants could not have been permitted to raise a new plea which even do not find mention in the writ petition.

The Court also pointed out the definition of the word "Additional Commissioner" given in sub-section (28C) of Section 2 of the Act which defines "Joint Commissioner" to mean a person appointed to be a Joint Commissioner of Income Tax or an Additional Commissioner of Income Tax under sub-section (1) of Section 117 of the Act whereupon the matter ended there and the Court in its wisdom did not think it proper to bring on record the aforementioned development.

Even otherwise, we find that this Court in the case of Dharam Pal Singh Rai v. Income Tax Officer, Ward II, Hapur and another, (2004) 271 ITR 223, has held that the Additional Commissioner would be a Joint Commissioner within the meaning of the word "Joint Commissioner" under sub-section (2) of Section 151 of the Act in view of the definition of the word "Joint Commissioner" given in Section 2(28C) of the Act. The aforesaid decision has been followed by this Court in the case of Farrukhabad Gramin Bank v. Additional Commissioner of Income Tax and another, (2005) 277 ITR 321, wherein this Court has held as follows:-

"Section 2(28C) of the Act defines the word "Joint Commissioner" as follows:-

"(28C) "Joint Commissioner" means a person appointed to be a Joint Commissioner of Income-tax or an Additional Commissioner of Income-tax under sub-section (1) of section 117;"

From a reading of the definition of the word "Joint Commissioner", reproduced above, it is seen that an Additional Commissioner of Income Tax is also the Joint Commissioner. This Court in Civil Misc. Writ Petition No.1646 of 2002, Dharam Pal Singh Rao v. The Income Tax Officer, Ward-2, Hapur and another, decided on 5.8.2004, has held that in view of the definition of the word "Joint Commissioner" in Section 2(28C) of the Act, an Additional Commissioner is to be treated as a Joint Commissioner."

The aforesaid two decisions have been following subsequently by this Court in Civil Misc. Writ Petition No.533 of 2002, Dr. Shashi Kant Garg v. Commissioner of Income Tax, Muzaffar Nagar and others, decided on 10.8.2005.

We find that the plea regarding non-recording of the satisfaction by the Commissioner or the Chief Commissioner had not been raised at the time of arguments and, therefore, the Court did not go into that question. We are further of the considered opinion that the aforesaid plea is not a pure question of law but it is a mixed question of fact and law. Whether or not the Chief Commissioner or the Commissioner has recorded the satisfaction on the reasons recorded that it is a fit case for issue of notice under Section 148 of the Act, does involve investigation on questions of fact for which the foremost requirement is that there should be specific pleading in the petition. Admittedly, in the present case, the petition was conspicuously silent on such a vital issue and the plea was introduced for the first time in the rejoinder affidavit filed just about a week before the hearing took place and that too was not referred to at the time of the arguments. Moreover, there arose no occasion for the Revenue to meet that plea. No doubt in view of the provisions of sub-section (1) of Section 151 of the Act, where an assessment has been made under Section 143(3) and a period of four years had expired, no notice under Section 148 of the Act can be legally issued unless the Chief Commissioner or the Commissioner has recorded the satisfaction that on the reasons recorded by the Assessing Officer it is a fit case for issue of a notice but as this was not argued at the time of the hearing of the writ petition, we decline to entertain this plea on an application for review.

In view of the foregoing discussions, we are of the considered opinion that the present application seeking review of our judgment and order dated 3.12.2004 is not maintainable, both on facts and law, and is accordingly hereby dismissed.

13.4.2006

vkp


Copyright

Reproduced in accordance with s52(q) of the Copyright Act 1957 (India) from judis.nic.in, indiacode.nic.in and other Indian High Court Websites

Advertisement

dwi Attorney | dui attorney | dwi | dui | austin attorney | san diego attorney | houston attorney | california attorney | washington attorney | minnesota attorney | dallas attorney | alaska attorney | los angeles attorney | dwi | dui | colorado attorney | new york attorney | new jersey attorney | san francisco attorney | seattle attorney | florida attorney | attorney | london lawyer | lawyer michigan | law firm |

Tip:
Double Click on any word for its dictionary meaning or to get reference material on it.