Bombay High Court
Veena Estates P.Ltd vs Commissione Of Income Tax Mumbai ... on 13 July, 2023
Author: G. S. Kulkarni
Bench: G. S. Kulkarni
903-itxa 302-02.odt
Prajakta Vartak
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
INCOME TAX APPEAL NO. 302 OF 2002
Veena Estate Pvt. Ltd. ..Appellant
Vs.
Commissioner of Income Tax,
Mumbai City-IX, Mumbai ..Respondent
__________
Mr. Aarti Vissanji for Appellant.
Mr. Madhur Agrawal as Amicus Curiae.
Mr. Ashutosh Misra with Mr. Umesh Gupta i/b. Mr. Devvrat Singh for
Respondent.
Mr. Suresh Kumar with Mr. Devvrat Singh, as Amicus (for Respondent).
__________
CORAM : G. S. KULKARNI &
JITENDRA JAIN, JJ.
DATE : JULY 13, 2023 P.C.:
1. This appeal was circulated before us on behalf of the appellant contending that the issue in regard to the alleged defect in the notice issued under Section 271(1)(c) of the Income-tax Act, 1961 (for short, "the Act") would stand covered by the decision of a co-ordinate Bench of this Court in Ventura Textiles Ltd. vs. Commissioner of Income Tax, Mumbai City-II1.
2. We have perused the observations of the Court in such decision and more particularly in paragraphs 20.1 and 20.2, whereby the Division 1 [2020] 117 taxmann.com 182 (Bombay) Page 1 of 4
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13 July, 2023 ::: Uploaded on - 15/07/2023 ::: Downloaded on - 16/07/2023 05:30:48 ::: 903-itxa 302-02.odt Bench has observed that even if a question was not raised before the tribunal, the same can be raised before the High Court in the proceedings under Section 260-A of the Act, when the issue is on jurisdiction. In our opinion, there cannot be any quarrel on such proposition.
3. The question, however, would be whether an assessee can be permitted to raise a technical plea of vagueness in the notice when the same was never the case of the assessee before the tribunal. The assessee never complained that the notice under Section 271(1)(c) of the Act was never understood by it or the same was in any manner vague or defective and had caused any prejudice to the assessee. In fact, now merely relying on the said decision, it is for the first time being contended that this Court should label the notice to be defective in the proceedings of this appeal under Section 260-A of the Act, in the absence of any such plea before the forums below. In our prima facie opinion, the appellant needs to satisfy the Court whether the appellant can at all urge such contention in the proceedings of a Section 260-A appeal when admittedly such question of law is not raised in the present appeal.
4. In our opinion, in the facts of the present case, if the appellant intends an additional question to be framed in this regard, the same Page 2 of 4
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13 July, 2023 ::: Uploaded on - 15/07/2023 ::: Downloaded on - 16/07/2023 05:30:48 ::: 903-itxa 302-02.odt cannot be done without the appellant crossing the barrier of the test of specific prejudice, if any caused to it in responding to such notice issued under Section 271(1)(c) of the Act, is satisfied.
5. The question therefore would be that when the assessee never raised a plea that the assessee did not understand such notice issued to him and/ or acquiesced and conceded in the adjudication of such notice, without any plea of prejudice being taken at any point of time, then in such circumstances, can the assessee take a plea before the High Court calling upon it to take a view that although no prejudice on such count was earlier felt and suffered, merely because it is now technically noticed that there was a defect in the notice by non striking of the applicable option, it should be deemed to be presumed that a prejudice was caused to the assessee and therefore, on such count, the penalty proceedings be declared illegal.
6. In our opinion, although Ventura Textiles Ltd. (supra) has although considered such issue being raised as a jurisdictional question in the proceedings of 260-A of the Income Tax Act, however, as to what would be the position as would be reflected from the settled principles of law that there cannot be a plea of breach of principles of natural justice or a Page 3 of 4
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13 July, 2023 ::: Uploaded on - 15/07/2023 ::: Downloaded on - 16/07/2023 05:30:48 ::: 903-itxa 302-02.odt prejudice, unless the threshold test of a "factual prejudice" being caused is satisfied, for the Court to accept such plea, is not what has been expressly considered.
7. It was contended that the decision in Ventura Textiles Ltd. (supra) was also considered by the Full Bench of this Court in Mohd. Farhan A. Shaikh v. Deputy Commissioner of Income Tax, Central Circle1, Belgaum2. We have perused the judgment of the Full Bench and more particularly paragraphs 85 to 90 and paragraphs 181 to 186, however, the issue which we have raised appears to have not been answered by the Full Bench, is what we note.
8. We would accordingly hear the parties on these issues on the adjourned date of hearing.
9. Stand over to 27 July, 2023 at 02.30 p.m. [JITENDRA JAIN, J.] [G. S. KULKARNI, J.]
2 (2021) 125 taxmann.com 253 Page 4 of 4
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