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2002 Supreme(Cal) 181
High Court Of Calcutta
Amitava Lala
ASHOKA MARKETING LIMITED - Appellant
Versus
INCOME TAX OFFICER,Ward 7 (1),Kolkata - Respondent
W. P. 431 Of 2002
Decided On : 03/15/2002
The liberty granted by the Court to make an assessment under Section 143 of the Income Tax Act, 1961, does not debar the authority concerned from issuing notices under Section 143(2) and 142(1) of the Act.
Headnote:
INCOME TAX ACT, 1961 - SECTION 142(1), 143(2), 144B, 153 - ASSESSMENT - TIME LIMIT - REVISED RETURN - LIBERTY GRANTED BY COURT - INTERPRETATION - NOTICES ISSUED UNDER SECTION 143(2) AND 142(1) - VALIDITY.
Fact of the Case:
The petitioner company filed a revised return showing a loss for the assessment year 1975-76. The Income Tax Officer issued a draft assessment order under Section 144b, which was quashed by the High Court in view of the omission of the Section itself by the Direct Tax Laws (Amendment) Act, 1989. The High Court granted liberty to make an assessment under Section 143 of the Act. The Income Tax Authority issued notices under Section 143(2) read with Section 142(1) upon the petitioner.
Finding of the Court:
The High Court held that the authority concerned cannot be debarred from issuing the notices on the basis of the liberty granted under an order of the Court. The Court further held that the petitioner could have given a reply taking the point of limitation, if any, which should have been the proper way to proceed with the same.
Issues: 1. Whether the authority concerned can be debarred from issuing the notices on the basis of the liberty granted under an order of the Court? 2. Whether the petitioner can challenge the notices before the Writ Court?
Ratio Decidendi: 1. The High Court held that the authority concerned cannot be debarred from issuing the notices on the basis of the liberty granted under an order of the Court. The Court relied on the provisions of Section 153(3)(ii) of the Income Tax Act, 1961, which provides that an assessment can be completed at any time in pursuance of an order of any Court in a proceeding otherwise than by way of appeal or reference under the Act. 2. The High Court held that the petitioner could have given a reply taking the point of limitation, if any, which should have been the proper way to proceed with the same. The Court further held that if it interferes at this stage, it would be passing self-contradictory orders.
Final Decision: The writ petition was dismissed.
( 1 ) THIS writ petition is made by the pen of one of the Directors of the petitioner company. From the record I do not find any affidavit of competency.
( 2 ) ACCORDING to the petitioner, the moot point of moving this writ petition is that the notices issued under section 143 (2) and 142 (1) of the Income Tax Act, 1961 both dated 12th February, 2002 in connection with the proceedings for assessment year 1975-76 shall be cancelled, withdrawn and rescinded by the order or orders of this Court.
( 3 ) ON 31st October, 1975 the petitioner company filed a return of income for the assessment year 1975-76 showing the income of Rs. 47,480/ -. On 11th October, 1977 the petitioner company filed a revised return showing a loss of Rs. 5,55,770/ -. On 5th October, 1978 a draft order of assessment was sent by the Income Tax Officer under Section 144b, then existing, as the variation proposed to be made by the Income Tax Officer exceeded a sum of Rs. 1,00,000/ -. On 18th October, 1978 the petitioner sent an objection under Section 144b (2) of the Act in respect of proposed draft order of assessment. On 19th January, 1979 appropriate Assistant Commissioner of Income Tax gave hearing of the objection. The hearing of assessment was completed under Section 143 (3) read with Section 144b of the Act on 7th April, 1979. On 9th April, 1979 the petitioner challenged the order as well as the proceeding. One of the Judges of this High Court was pleased to issue Rule and grant interim order of the injunction restraining the respondents from proceeding with the assessment of the year 1975-76. On 19th April, 1979 such Court was pleased to modify the interim order passed earlier on 9th April, 1979 and the authority was given liberty to continue and complete the proceedings under Section 144b of the Act of the assessment year 1975-76 but the final order passed, if any, will not be communicated to or enforced against the petitioner till the disposal of the Rule.
( 4 ) THE said writ petition came up for final hearing on 6th July, 2000 before me and following order was passed : following the ratio of the judgment passed a Single Bench of this Court on 31st January, 19?. being C. R. No. 2640 (W) of 1981, the similar order passed by this Court as follows :in this writ petition Section 144b of the Income Tax Act, 1961 (hereinafter referred to as the Act) was challenged. The draft assessment orders passed by the respondent No. 1 in terms of Section 144b of the Act were also impugned. Section 144b was omitted by the Direct Tax Laws (Amendment) Act, 1989 with effect from 1. 4. 1989. As such the challenge to the Section does not service. The draft assessment orders passed by the respondent No. relating to the Assessment Year under Section 144b are also quashed. The respondent No. 1 will be at liberty to make an assessment in respect of the assessment year in question under the provisions of Section 143 of the Act. The writ petition is disposed of accordingly. There will be no order as to costs. Let a photo copy of the unreported judgment dated 31. 1. 1991 filed in Court today be kept with the record of this case.
( 5 ) IT appears that the draft assessment order in relation to such assessment year passed under Section 144b was quashed in view of omission of the Section itself by the Direct Tax Laws (Amendment) Act, 1989. However, liberty was granted to make respective assessment under provision of Section 143 of the Act.
( 6 ) ACCORDING to the petitioner in the garb of such liberty, Income Tax Authority issued notice under Section 143 (2) read with Section 142 (1) upon the petitioner. Interpretation of such liberty is the subject matter of consideration is the present writ petition. But it appears to this Court the petitioner is also asking relief or reliefs in connection with such notice and proceeding in addition to such interpretation.
( 7 ) UNDER Section 142 (1) of the Act, the Assessing Officer may serve on any person who has made a return
