Facts of the Case

The petitioner challenged assessment orders passed under Section 153A of the Income Tax Act before the Delhi High Court. The grievance of the petitioner was that the assessment order was passed without granting sufficient opportunity of hearing and in breach of natural justice.

The petitioner contended that the assessment proceedings were concluded within a period of nine days, making it impossible to properly present her case.

At the same time, it was admitted before the Court that the petitioner had already filed statutory appeals against the same assessment orders before the Commissioner of Income Tax (Appeals).

The tax demand raised under the impugned orders was stated to be approximately ₹18–19 crores.

Issues Involved

  1. Whether a writ petition challenging an assessment order under Section 153A is maintainable when the petitioner has already filed a statutory appeal against the same order?
  2. Whether alleged violation of principles of natural justice can justify exercise of writ jurisdiction despite availability of an alternative remedy?
  3. Whether interim protection against coercive recovery should continue pending consideration of stay application before appellate authority?

Petitioner’s Arguments

  • The petitioner argued that the assessment order under Section 153A was legally unsustainable.
  • It was contended that adequate and fair opportunity of hearing was not provided.
  • The assessment was allegedly completed in an unreasonably short period of nine days, violating principles of natural justice.
  • The petitioner submitted that due to the enormous tax demand of ₹18–19 crores, immediate enforcement would cause grave prejudice.

Respondent’s Arguments

  • The Revenue opposed the writ petitions and contested the petitioner’s allegations.
  • It was argued that statutory appellate remedies were available and had already been invoked by the petitioner.
  • Therefore, all grounds, including alleged violation of natural justice and merits of additions, could be adjudicated by the appellate authority.

Court Findings / Observations

The Delhi High Court observed that once the petitioner had already exercised the statutory right of appeal against the assessment order, it would not be proper to permit simultaneous pursuit of writ remedies against the same order.

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

The Court further observed that all issues, including allegations of inadequate opportunity and merits of additions, can be examined by the appellate authority.

The High Court declined to entertain the writ petitions and clarified that it had not expressed any opinion on the merits of the controversy.

Court Order / Final Decision

The Delhi High Court disposed of the writ petitions and refused to exercise discretionary writ jurisdiction under Article 226, holding that the petitioner must pursue the statutory appellate remedy already invoked.

The interim protection against coercive recovery granted earlier was directed to continue for five weeks to enable the petitioner to move an application for stay before the appellate authority.

Important Clarification

The Court specifically clarified that dismissal/disposal of the writ petitions shall not prejudice the petitioner’s right to raise all legal and factual grounds before the appellate authority, including the plea of violation of natural justice.

It was further clarified that the Court had not adjudicated upon the merits of the assessment order.

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

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