M/S Naagal Garments Industries Pvt. Ltd. vs. Commissioner Of Income Tax I

1 W.P. No.3586 of 2016 01.03.2016 Shri Abhishek Oswal, Advocate for the petitioner. Shri Sanjay Lal, Advocate for the respondents. Heard counsel for the parties. As short question is involved, petition is taken up for final disposal forthwith. Counsel for the respondents, waive notice. This petition has been filed invoking Article 226 of the Constitution, essentially, on account of absence of Tribunal at Jabalpur. The challenge in the petition is to the order passed under Section 263 of the Income Tax Act for the Assessment Year 2010-2011. According to the petitioner, regular appeal before the Income Tax Appellate Tribunal is available to the petitioner, which the petitioner has invoked by filing such appeal before the Jabalpur Bench of the Tribunal. However, Bench at Jabalpur is not functional for logistical reasons. The grievance of the petitioner is that the remedy of appeal guaranteed to the petitioner, has been rendered ineffective and on the other hand, the assessment under Section 142(1) of the Income Tax Act is being hastened. That, inevitably, entails in rendering the petitioner remediless against the order passed under 2 Section 263 of the Income Tax Act. Similar grievance was made in Writ Petition No.3415/2015 filed by DPR Charitable Trust. The Division Bench of this Court, vide order dated 27.11.2015, allowed the writ petition and issued certain directions. The petitioner seeks similar directions, by way of present writ petition. Counsel for the respondents submits that the Bench of the Appellate Tribunal at Jabalpur is not functional, should not be the sole basis to interfere and more so because it is open to the petitioner to get his appeal filed before the Bench at Jabalpur, transferred to Indore Bench where the Bench is functioning on regular basis. This argument, though attractive at the first blush, must be rejected. The fact that the Bench of the Appellate Tribunal is available at Indore, cannot be the basis to deny remedy to the petitioner, which, otherwise, can be pursued by it before the Appellate Tribunal Bench at Jabalpur. It would have been a different matter if the Appellate Tribunal was not established at Jabalpur. Having established a Bench at Jabalpur, it is the obligation of the Competent Authority to ensure that the Bench is functional at any given point of time, to make the statutory remedy meaningful. Besides, the Division Bench of this Court, having recently 3 entertained similar grievance in W.P. No.3415/2015 and answered against the respondents, whilst adhering to judicial propriety, we are persuaded by the argument of the petitioner that until the Appellate Tribunal Bench at Jabalpur is made functional, the interest of the petitioner must be preserved by directing the Authorities to refrain from hastening the assessment under Section 142(1) of the Income Tax Act. This Court has already taken notice of the fact that the Bench at Jabalpur has become partially functional and Circuit sittings are held as and when the Members of the Appellate Tribunal are available for holding sitting at Jabalpur. As a result, we direct the respondent Nos.1 and 2 to place the matter before the Appellate Tribunal Bench at Jabalpur for consideration as and when the Bench is available so as to pass appropriate orders on that appeal preferred by the writ petitioner. Until the Appellate Tribunal Bench at Jabalpur passes any order on that appeal proceedings, it is, but appropriate and in the interest of justice that the assessment proceedings under Section 142(1), should not be hastened by the concerned Authority relying on the order passed under Section 263 of the Act. That should be done only after a formal order is passed by 4 the Appellate Tribunal on the appeal preferred by the petitioner. In other words, following the observations and directions issued by the Division Bench of this Court in W.P. No.3415/2015, we dispose of this writ petition on the same terms. C.C. as per rules. (A. M. Khanwilkar) (Sanjay Yadav)

Chief Justice

Judge psm