Madras High Court
Dr.K. Nedunchezhian vs Deputy Commissioner Of Income-Tax on 27 January, 2005
Author: F.M.Ibrahim Kalifulla
Bench: F.M.Ibrahim Kalifulla
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 27/01/2005
CORAM
THE HONOURABLE MR. JUSTICE F.M.IBRAHIM KALIFULLA
W.P. NO.1752 OF 2005
and
W.P.M.P.No.1941/2005
Dr.K. Nedunchezhian ...PETITIONER
-Vs-
Deputy Commissioner of Income-Tax
Central Circle, No.3, Gandhi Road
Salem-638 007.
... Respondent
Petition filed under Article 226 of the Constitution of India
praying this court to issue a Writ of Certiorari, to call for the records in
P.A.N./G.I.R. No.CCPN-006/PAN-ABLPNO833E dated 29.12.2004 on the file of the
respondent and quash the same.
!For Petitioner : Mr. C.Ramachandran
Senior Counsel for
M/s Anitha Sumanth
^For Respondnet : -
:ORDER
The petitioner seeks to challenge the order of assessment passed by the respondent herein dated 29.12.2004 under Section 158BC(c) read with Section 143(3) of the Income-Tax Act.
2. Mr.C.Ramachandran, learned senior counsel appearing for the petitioner would contend that there was a search made in the petitioner' s premises in December,2002 pursuant to warrant dated 12.12.2004, that in the said warrant there was no reference to any details as regards the search to be made, that subsequent to the said search, a notice was issued to the petitioner on 9.12.2004 to which the petitioner filed his detailed replies on 16.12.2004 and 23.12.2004 wherein the petitioner wanted the details of the materials and the production of witnesses based on which evidence, the respondent sought to make an assessment as against the petitioner. The learned senior counsel would therefore contend that without taking note of the petitioner's grievances, the impugned order of assessment came to be passed on 29.12.2004 whereby serious violations of principles of natural justice have been committed by the respondent while passing the order impugned in the Writ Petition. It is in these circumstances, the learned senior counsel would contend that the petitioner cannot validly work out his remedy by way of statutory appeal provided under Section 247 to 251 of the Income Tax Act.
3. According to the learned senior counsel, a perusal of the powers of the Commissioner(Appeals) would show that such powers are very limited where he cannot possibly deal with the question as to violation of principles of natural justice and that he can confine his scope of consideration while disposing of the appeal within the limited scope provided under Section 251(1)(a)(b) and (c) of the Act and the said provision does not provide any scope for dealing with the question of violation of principles of natural justice while passing the impugned order of assessment. In this context, the learned senior counsel also relied upon the Finance(No.2) Act,1998 which came into effect on and from 1.10.1998 in and by which certain expressions in the then existing Section 251 of the Act came to be removed and such expressions having been deleted from the said provisions, it will have be held that the Commissioner(Appeals) lack jurisdiction to deal with such preliminary issue relating to the violation of principles of natural justice and the said appellate Authority can only deal with the question as to merits of the assessment and nothing else.
4. Having heard the submissions of the learned senior counsel and on a perusal of Section 250 as well as 251 of the Act, I am of the view that such contention put-forth on behalf of the petitioner cannot be countenanced. For better appreciation of the stand of the petitioner, relevant provisions can be extracted which reads as under:
250:(1) The Commissioner(Appeals) shall fix a day and place for the hearing of the appeal, and shall give notice of the same to the appellant and to the Assessing Officer against whose order the appeal is preferred.
(2) The following shall have the right to be heard at the hearing of the appeal:-
(a) the appellant, either in person or by an authorised representative;
(b) The Assessing Officer either in person or by a representative.
(3) The Commissioner(Appeals) shall have the power to adjourn the hearing of the appeal from time to time.
(4) The Commissioner(Appeals) may, before disposing of any appeal make such further enquiry as he thinks fit, or may direct the Assessing Officer to make further enquiry and report the result of the same to the Commissioner(Appeals) (5) The Commissioner(Appeals) may, at the hearing of the appeal,allow the appellant to go into any ground of appeal not specified in the grounds of appeal, if the Commissioner(Appeals) is satisfied that the omission of that ground from the form of appeal was not wilful or unreasonable.
(6) The order of the Commissioner(Appeals) disposing of the appeals shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision.
(6A) In every appeal, the Commissioner(Appeals) where it is possible, may hear and decide such appeal within a period of one year from the end of the financial year in which such appeal is filed before him under sub-section (1) of Section 246-A.
7) On the disposal of the appeal, the Commissioner (Appeals) shall communicate the order passed by him to the assessee and to the Chief Commissioner or Commissioner.
251: Powers of the Commissioner(Appeals) (1) In disposing of an appeal, the Commissioner (Appeals) shall have the following powers:
(a) In an appeal against an order of assessment he may confirm, reduce, enhance or annul the assessment; or he may set aside the assessment and refer the case back to the Assessing Officer for making a fresh assessment in accordance with the direction given by the Commissioner(Appeals) and after making such further enquiry, as may be necessary, and the Assessing Officer shall thereupon proceed to make such fresh assessment and determine, where necessary, the amount of tax payable on the basis of such fresh assessment;
(b) in an appeal against an order imposing a penalty, he may confirm or cancel such order or vary it so as either to enhance or to reduce the penalty;
(c) in any other case, he may pass such orders in the appeal as he thinks fit.
(2) The Commissioner(Appeals) shall not enhance an assessment or a penalty or reduce the amount of refund unless the appellant has had a reasonable opportunity of showing cause against such enhancement or reduction.
Explanation: In disposing of an appeal, the Commissioner (Appeals) may consider and decide any matter arising out of the proceedings in which the order appealed against was passed, notwithstanding that such matter was not raised before the Commissioner(Appeals) by the appellant.
5. Under Section 250 while fixing the procedure of hearing of appeal, various prescriptions have been made as to how the appellant can represent himself in the appeal proceedings and the power of the Commissioner(Appeals) to fix the necessary dates of hearing before disposing of the appeal. It also vests with the Commissioner(Appeals) to make further enquiries as and when required for the better appreciation of the appeal.
6. Infact, under Section 250(5), it is specifically provided that the Commissioner(Appeals) can even allow the appellant to go into any ground of appeal not specified in the grounds of appeal if the appellate Authority is satisfied with the omission of that ground from the Form of Appeal was neither wilful nor unreasonable. Similarly under Section 251(1((c), it is provided that the appellate Authority in any other case can pass orders in the appeal as he thinks fit. Further in the explanation it is stated that the Commissioner(Appeals) can consider and decide any matter arising out of the proceedings in which the order appealed against was passed notwithstanding that such matter was not raised before the Commissioner(Appeals) by the appellant. Thus, a conspectus reading of the abovesaid provisions even after the deletion of certain expressions by Finance Act (No.2) of 1998 would make it clear that the Commissioner(Appeals) has been vested with sufficient powers to decide the appeal on merits on all aspects in order to render justice by virtue of exercise of the appellate power vested with him. In such circumstances, merely because certain expressions came to be deleted from Section 250(1)(c)of the Act, I am afraid, it cannot be held that there is no scope for the Commissioner(Appeals) to go into the question as to the violation of principles of natural justice complained of by the assessee while prosecuting the appeal before him.
7. In view of the above said conclusion, I do not find any scope to entertain this Writ Petition in the light of alternative efficacious remedy available to the petitioner under Sections 247 to 251 of the Income Tax Act. The Writ Petition therefore fails and the same is dismissed. Consequently, W.P.M.P.No.1941/2005 is also dismissed.
8. Mr.C.Ramachandran, learned senior counsel submits that since the petitioner was prosecuting this Writ Petition, the last date for filing the appeal expired on 28.01.2005 and the petitioner should be given some breathing time to present the appeal before the Commissioner( Appeals). Considering the grievance of the petitioner, the petitioner is permitted to file the appeal on or before 04.02.2005.
Index: Yes site: Yes vbs To Deputy Commissioner of Income-Tax Central Circle, No.3, Gandhi Road Salem-638 007.