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Judgment
Markandey Katju, C.J.—These are two connected writ appeals and are being disposed off by a common judgment. Heard the learned
senior counsel for the appellant and the learned departmental counsel.
The appellant had first filed a writ petition challenging the assessment notice u/s 158BC of the Income Tax Act, 1961. That writ petition being
W.P. No. 38648 of 2004 was dismissed on 7.2.2005 on the ground that assessment order has already been passed on 29.12.2004 and the writ
petition challenging that assessment order being W.P. No. 1725 of 2005 has also been dismissed o n 27.1.2005.
W.P. No. 1725 of 2005 had been dismissed by the learned single Judge on the ground that since the assessment order has been passed the
petitioner has an alternative remedy of filing an appeal u/s 246 read with section 251 of the Income Tax Act. We agree with the view taken by the
learned single Judge that the appellant has an efficacious alternative remedy of filing an appeal.
In W.A. No. 377 of 2005 dated 2.3.2005 (M/s. Nivaram Pharma Pvt. Ltd. v. The Customs, Excise & Gold (Control) Appellate Tribunal,
Madras) we have discussed this matter in great detail and have observed that particularly in tax matters there should be no short circuiting of the
alternative statutory remedies as has been repeatedly emphasized by the Supreme Court.
It is well settled by a series of decisions of the Supreme Court that particularly in tax matters there should be no short circuiting of the statutory
remedies, vide Titaghur Paper Mills Co. Ltd. and Another Vs. State of Orissa and Others, , Assistant Collector of Central Excise, Chandan
Nagar, West Bengal Vs. Dunlop India Ltd. and Others, , etc.
It is well settled that when there is an alternative remedy ordinarily writ jurisdiction of this Court under Article 226 of the Constitution should not
be invoked. This principle applies with greater force regarding tax proceedings. As observed by the Supreme Court in Titaghur Paper Mills Co.
Ltd. and Another Vs. State of Orissa and Others, :
Where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be
availed of.
A Constitution Bench of the Supreme Court in Veerappa Pillai Vs. Raman and Raman Ltd. and Others, held that as the Motor Vehicles Act is a
self contained code and itself provides for a forum for appeal/revision, the writ jurisdiction should not be invoked in matters relating to its
provisions. A similar view was taken in Assistant Collector of Central Excise, Chandan Nagar, West Bengal Vs. Dunlop India Ltd. and Others, .
In Assistant Collector of Central Excise, Chandan Nagar V. Dunlop India Limited (supra) the Supreme Court observed:
In Titaghur Paper Mills Co. Ltd. and Another Vs. State of Orissa and Others, A.P. Sen, E.S. Venkataramiah and R.B. Misra, JJ. held that where
the statute itself provided the petitioners with an efficacious alternative remedy by way of an appeal to the Prescribed Authority, a second appeal
to the Tribunal and thereafter to have the case stated to the High Court, it was not for the High Court to exercise its extraordinary jurisdiction
under Article 226 of the Constitution ignoring as it were, the complete statutory machinery. That it has become necessary, even now, for us to
repeat this admonition is indeed a matter of tragic concern to us. Article 226 is not meant to short circuit or circumvent statutory procedures. It is
only where statutory remedies are entirely ill suited to meet the demands of extraordinary situations, as for instance where the very vires of the
statute is in question or where private or public wrongs are so inextricably mixed up and the prevention of public injury and the vindication of public
justice require it that recourse may be had to Art.226 of the Constitution. But, then the Court must have good and sufficient reason to by pass the
alternative remedy provided by statute. Surely, matters involving the revenue where statutory remedies are available are not such matters. We can
also take judicial notice of the fact that the vast majority of the petitions under Art.226 of the Constitution are filed solely for the purpose of
obtaining interim orders and thereafter prolong the proceedings by one device or the other. The practice certainly needs to be strongly
discouraged.
In C.A. Abraham, Uppoottil, Kottayam Vs. The Income Tax Officer, Kottayam and Another, , H.B. Gandhi v. M/s. Gopinath & Sons, 1992
(Suppl) 2 SCC 312 and in Karnataka Chemical Industries and Others Vs. Union of India and Others, the Supreme Court held that where there is
a hierarchy of appeals provided by the statute the party must exhaust the statutory remedies before resorting to writ jurisdiction. All these decisions
are related to taxing statutes, and are hence apposite to the present context.
In Sheela Devi Vs. Jaspal Singh, and Punjab National Bank Vs. O.C. Krishnan and Others, the Supreme Court held that if the statute
provides for remedy of revision or appeal, writ jurisdiction should not be invoked.
In Union of India (UOI) Vs. T.R. Varma, the Supreme Court held that it is well settled that when an alternative and equally efficacious remedy
is open to a litigant, he should be required to pursue that remedy and not invoke the special jurisdiction of the High Court to issue a prerogative
writ. It will be a sound exercise of discretion to refuse to interfere in a petition under Article 226 of the Constitution unless there are good grounds
to do otherwise.
In A. Venkatasubbiah Naidu Vs. S. Challappan and Others, the Supreme Court deprecated the practice of exercising the writ jurisdiction
when an efficacious alternative remedy is available.
In W.P. No. 981 of 2003 (Tax) (M/s. Khandelwal Soya Industries Ltd. v. State of U.P. and Ors.) decided on 27.8.2003 a Division Bench of
the Allahabad High Court dismissed a writ petition challenging the provisional assessment orders under the U.P. Trade Tax Act on the ground of
alternative remedy u/s 9 of that Act. Against the aforesaid judgment, SLP was filed before the Supreme Court which has been dismissed. We
respectfully agree with the view taken by the Allahabad High Court in the aforesaid decision.
Learned senior counsel for the appellant submitted that section 251 of the Income Tax Act has been amended by Finance Act, 2001 and now
there is no power in the Commissioner (Appeals) to remand the matter back to the Assessing Officer. In our opinion, that will not make any
difference to this case because obviously what the legislature intended was that there should be no delay in the matter, and hence the appellate
authority itself should dispose of the entire matter on merits instead of remanding the matter to the Assessing Officer. However, the power in the
appellate authority of deciding the entire matter remains intact and is not in any way taken away by the aforesaid amendment by the Finance Act,
2001. It is well settled that the appellate power includes all the powers of the original authority and hence the appellant can raise all the points
which he is urging before us in both these writ appeals before the appellate authority in his appeal u/s 246/251 of the Income Tax Act.
We may also mention that we have already held in Tamilnadu State Transport Corporation v. C. Durai and Anr., 2005 W.L.R. 136 that even
if there is violation of natural justice or the order is without jurisdiction, the writ petition can still be dismissed if there is an alternative remedy, and
we have distinguished the Supreme Court decision in Baburam Prakash Chandra Maheshwari Vs. Antarim Zila Parishad now Zila Parishad,
Muzaffarnagar, in that case.
In Titaghur Paper Mills Co. Ltd. and Another Vs. State of Orissa and Others, the appellant had pleaded that there was violation of natural
justice, and the impugned order was without jurisdiction. Yet the Court held that the petitioner should avail his alternative remedy of appeal.
With these observations both the writ appeals are dismissed. No costs. Consequently W.A.M.P. No. 819/2005 is also dismissed.