SREEKANDAN B., vs. THE CENTRAL BOARD OF DIRECT TAXES,

In W.P(C). No.23659/2021, petitioner has challenged Ext.P10 order of assessment, issued under Section 143(3) of the Income Tax Act (hereinafter referred to as 'the Act'), on the ground that it is issued in violation of principles of natural justices and that several pages of the order itself are illegible and unreadable.

Learned counsel appearing for the petitioner submits that a survey was conducted in respect of the petitioner, who is running a quarry business. It is submitted that several notices were issued to the petitioner and that the petitioner responded to each one of them. It is submitted that the petitioner was issued with Ext.P8 notice on 23.09.2021, calling upon the petitioner to submit originals of certain documents before 03.00 pm on 24.09.2021 and the petitioner submitted Ext.P9 reply seeking a reasonable time to furnish the documents directed to be produced. It is submitted that without considering Ext.P9, the Assessing Officer issued Ext.P10 order of assessment. It is pointed out from Ext.P10 that several of the pages of Ext.P10 order of assessment are illegible and unreadable. It is [WP(C) Nos.22140/2022 & 23659/2021] 4 submitted that the petitioner’s claim for expenses has been rejected arbitrarily and without any basis. It is submitted that Ext.P10 order is without juri iction and is liable to be interfered with at this stage under Article 226 of the Constitution of India.

In W.P(C.). No.22140/2022, petitioner challenges the order imposing penalty on the basis of the assessment order which is challenged in the other writ petition [W.P(C.). No.23659 of 2021]. The provisions of Section 270A of the Act have also been challenged, by pointing out that it gives arbitrary and uncanalized power to the officer imposing penalty to treat certain actions of the petitioner as under-reporting or misreporting. It is submitted that in every case where certain claim for expenses, deductions etc., are made and the same is denied by the Assessing Officer, almost automatically, proceedings are initiated under Section 270A of the Act which obviously cannot be the intention of that provision. It is also submitted that the provision is vague and too widely worded and is capable of being misused. It is further submitted that since there are various defects in respect of Ext.P10 order of assessment, which have already been raised in the connected writ petition, a penalty order on the basis of such assessment

Learned Standing counsel appearing for the Department would submit that several opportunities were given to the petitioner to produce documents and refers to the notices issued to the petitioner from time to time which are part of the records in W.P.(C.). No.23659 of 2021. It is submitted that Ext.P8 notice had required the furnishing of additional documents by 03.00 pm on the day next to issuance of Ext.P8 notice only on account of the fact that the assessment was becoming time barred on 30.09.2021. It is submitted that Ext.P10 order does not warrant interference with it in exercise of the juri iction under Article 226 of the Constitution of India ,at least at this stage of the proceedings. It is submitted that that if the petitioner has a case that several pages of Ext.P10 order of assessment order are illegible, the Assessing Officer can be directed to provide a legible copy of Ext.P10 to the petitioner. It is submitted that the petitioner has an adequate remedy against Ext.P10 by way of appeal where all the contentions taken by the petitioner can be considered.

Learned Standing counsel also submitted that the order of penalty impugned in W.P.(C.). No.22140 of 2022 was issued under the provisions of Section 270A of the Act, after

I have considered the contentions raised. I have perused the documents produced along with W.P.(C.). No.23659/2021. While it is true that several of the pages in Ext.P10 order are illegible and unreadable, I find it difficult to hold that Ext.P10 order was issued without affording a sufficient opportunity for the petitioner. Ofcourse, if an order is issued in violation of principles of natural justice, then notwithstanding the availability of an alternative remedy, it will be open to this Court to interfere with such proceedings in exercise of juri iction under Article 226 of the Constitution of India. However, since I have no reason to hold that Ext.P10 order was issued in violation of principles of natural justice, I decline to interfere with Ext.P10. 8. Coming to the challenge to the order imposing penalty, I am of the view that at least in the first instance, it is for the petitioner to avail the appellate remedy against the order imposing penalty. The grounds on which a statutory provision can be challenged, under our constitutional scheme are:- (i) Violation of Fundamental Rights; (ii) Lack of legislative competence; and (iii) Violation of basic structure.