Facts of the Case

The petitioner challenged multiple assessment orders passed under Section 153A of the Income Tax Act before the Delhi High Court through writ petitions. During the hearing, it was admitted by the petitioner’s representative that an appeal had already been filed against the impugned assessment orders before the Commissioner of Income Tax (Appeals).

The grievance raised was that the assessment proceedings were concluded within a short period of nine days, thereby allegedly depriving the petitioner of adequate opportunity to present her case, resulting in violation of natural justice. The petitioner also highlighted the substantial tax demand and expressed inability to discharge the same.

Issues Involved

  1. Whether a writ petition under Article 226 is maintainable when the statutory appellate remedy has already been exercised by the petitioner?
  2. Whether the assessment order under Section 153A could be challenged directly in writ jurisdiction on the ground of violation of natural justice?
  3. Whether interim protection against coercive recovery should continue pending appellate proceedings?

Petitioner’s Arguments

  • The assessment order under Section 153A was illegal and unsustainable in law.
  • The order violated principles of natural justice due to inadequate time and opportunity.
  • The order was passed within nine days, which was insufficient for proper representation.
  • A huge tax demand of approximately ₹18–19 crores had been raised, and the petitioner was financially incapable of immediate compliance.
  • Interim protection against coercive recovery was necessary.

Respondent’s Arguments

  • The petitioner had already exercised the statutory remedy by filing an appeal before the Commissioner of Income Tax (Appeals).
  • Since an alternative statutory remedy had already been invoked, the writ petition was not maintainable.
  • All grounds including allegations of violation of natural justice could be effectively raised before the appellate authority.
  • The merits of additions should be examined by the statutory appellate forum.

Court Findings / Court Order

The Delhi High Court held that once the petitioner had already availed the statutory appellate remedy against the assessment order under Section 153A, parallel proceedings through writ jurisdiction could not be permitted.

The Court reiterated the settled principle that writ jurisdiction is ordinarily not exercised where an efficacious alternative remedy is available, particularly when such remedy has already been invoked.

The Court clarified that all issues, including the allegation of lack of adequate opportunity and violation of natural justice, could be agitated before the Commissioner of Income Tax (Appeals).

Accordingly, the writ petitions were disposed of without expressing any opinion on the merits of the case. The interim protection from coercive recovery was directed to continue for five weeks to enable the petitioner to seek stay before the appellate authority.

Important Clarification by Court

The High Court expressly clarified that it had not examined or expressed any opinion on the merits of the assessment additions and that all rights and contentions remained open before the appellate authority.

Sections Involved

  • Section 153A, Income Tax Act, 1961 (Assessment in case of search or requisition)
  • Appellate Remedy before Commissioner of Income Tax (Appeals)
  • Principles of Natural Justice

Link to download the order - https://delhihighcourt.nic.in/app/case_number_pdf/2018:DHC:9138-DB/SKN21022018CW6462017_170706.pdf

Disclaimer

This content is shared strictly for general information and knowledge purposes only. Readers should independently verify the information from reliable sources. It is not intended to provide legal, professional, or advisory guidance. The author and the organisation disclaim all liability arising from the use of this content. The material has been prepared with the assistance of AI tools.