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Mancharrao Narsingrao Heble Vs. Union of India and Another - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtMumbai High Court
Decided On
Case NumberWrit Petition No. 1230 of 1981
Judge
Reported in[1985]151ITR305(Bom)
Acts Income Tax Act, 1961 - Sections 13(1), 23(1), 23(3) and 246
AppellantMancharrao Narsingrao Heble
RespondentUnion of India and Another
Excerpt:
.....on grounds of existence of efficacious alternative remedy - it is only in exceptional cases that writ jurisdiction is exercised inspite of there being alternative remedy - petitioner bound to adopt remedy of filing appeal under section 246 - proper remedy for petitioner is to file appeal - interference unwarranted. - - in my judgment, the submission of the petitioner is clearly misconceived. it is now well settled that the high court will be slow in exercising writ jurisdiction under article 226 of the constitution when the litigant has an alternative efficacious remedy. it is undoubtedly true that the high court had jurisdiction under article 226 of the constitution to grant relief even when there is an alternative remedy, but the high court is always slow in exercising that..........is clearly misconceived. it is now well settled that the high court will be slow in exercising writ jurisdiction under article 226 of the constitution when the litigant has an alternative efficacious remedy. it is undoubtedly true that the high court had jurisdiction under article 226 of the constitution to grant relief even when there is an alternative remedy, but the high court is always slow in exercising that jurisdiction and it is only in exceptional cases that the writ jurisdiction is exercised in spite of there being an alternative remedy.4. the learned counsel for the revenue, in this connection, invited my attention to a decision of the supreme court in titaghur paper mills co. ltd. v. state of orissa : [1983]142itr663(sc) , where the supreme court observed as under while.....
Judgment:

Pendse, J.

1. By this petition filed under article 226 of the Constitution of India, the petitioner is seeking a writ of certiorari or any other writ to quash the order of the assessment dated February 28, 1981, passed by the 7th Income-tax Officer, P-Circle, Bombay. The petitioner is occupying a flat on the 6th floor of the building 'Atur Terraces' situate at 19, Cuffe Parade, and for the assessment year 1978-79, the petitioner filed his return and in the return the property income from this flat was not shown. The ITO, while passing the impugned order, set out the contentions of the petitioner that he is neither the owner of the flat nor can he be deemed to be the owner, and rejected the contention holding that the income from the house property is assessable to tax.

2. The learned counsel on behalf of the Revenue raised a preliminary objection to the maintainability of the petition, submitting that the petitioner has an efficacious alternative remedy provided under the I.T. Act, 1961. The petitioner could prefer an appeal under s. 246 of the I.T. Act before the AAC, and if aggrieved, further appeal to the Commissioner and then to the Tribunal. The learned counsel submits that it is not proper for this court to entertain the petition by permitting the petitioner to challenge the order of the ITO without exhaustion of the alternative remedy. In my judgment, the preliminary objection raised on behalf of the respondents is sound and deserves to be upheld. The petitioner, who appeared in person and who is an advocate of this court, invited my attention to page 836 of the Constitution of India by Mr. Seervai, second edition, Vol. II, where the learned author has summarized The proposition emerging from the decided cases on the question of alternative remedies. The petitioner argued that the order passed by the ITO is contrary to law or is without authority of law and, therefore, the writ petition against the said order is maintainable. It was also urged that in respect of writ of certiorari, there is no rule that it will lie only if there is no adequate alternate remedy. The petitioner also relied upon the decision of the Supreme Court in State of Uttar Pradesh v. Mohammad Nooh : [1958]1SCR595 and Bhopal Sugar Industries Ltd. v. Dube, Sales Tax Officer (No. 2) : [1964]1SCR488 . In the later decision, which was under the provisions of the Sales Tax Act, the Supreme Court observed (p. 414 of 14 STC) :

'It is true that the jurisdiction of the High Court under art. 226 is extensive, but normally the High Court does not exercise that jurisdiction by entertaining petitions against the order of taxing authorities, when the statute under which tax is sought to be levied provides a remedy by way of an appeal or other proceedings to a party aggrieved and thereby bypass the statutory machinery. That is not to say that the High Court will never entertain a petition against the order of the taxing officer. The High Court has undoubtedly jurisdiction to decide whether a statute under which a tax is sought to be levied is within the legislative competence of the Legislature enacting it or whether the statute defies constitutional restrictions or infringes any fundamental rights, or whether the taxing authority has arrogated to himself power which he does not posses, or has committed a serious error of procedure which has affected the validity of his conclusion or even where the taxing authority threatens to recover tax on an interpretation of the statute which is erroneous.'

3. The petitioner claims that the ITO has not only passed the impugned order rejecting the claim of the petitioner, but the tax found due was adjusted with the refund which the petitioner was entitled to and, therefore, the present case falls within the category or cases set out by the Supreme Court decision and the petitioner can claim that the taxing authority had threatened to recover tax on an erroneous interpretation of the statute. In my judgment, the submission of the petitioner is clearly misconceived. It is now well settled that the High Court will be slow in exercising writ jurisdiction under article 226 of the Constitution when the litigant has an alternative efficacious remedy. It is undoubtedly true that the High Court had jurisdiction under article 226 of the Constitution to grant relief even when there is an alternative remedy, but the High Court is always slow in exercising that jurisdiction and it is only in exceptional cases that the writ jurisdiction is exercised in spite of there being an alternative remedy.

4. The learned counsel for the Revenue, in this connection, invited my attention to a decision of the Supreme Court in Titaghur Paper Mills Co. Ltd. v. State of Orissa : [1983]142ITR663(SC) , where the Supreme Court observed as under while considering whether the High Court was right in exercising writ jurisdiction under article 226 of the Constitution in regard to an order of assessment passed under the Sales Tax Act (see headnote) :

'That the Act provide for a complete machinery to challenge an order of assessment and the order of assessment in this case could be challenged only by the mode prescribed by the Act and not by a petition under art. 226 of the Constitution of India. The Act provided for an adequate safeguard against an arbitrary or unjust assessment. The petitioners had a right to prefer appeals under s. 23(1), subject to their payment of the admitted amount of tax as enjoined by the proviso thereto, and as regards the disputed amount of tax, they had the remedy of applying for stay of recovery to the Commissioner under cl. (a) of the second proviso to s. 13(1).'

5. The Supreme Court further held (see headnote) :

'That the petitioners had an equally efficacious alternative remedy by way of appeal to the prescribed authority under s. 23(1) of the Act, then a second appeal to the Tribunal under s. 23(3)(a) and thereafter to have a case stated to the High Court. This was a case in which the entrustment of power to assess was not in dispute and the challenge was only to the regularity of the proceedings before the STO as also his authority to treat the gross turnover returned to be the taxable turnover.'

6. The reliance on this decision by the learned counsel for the Revenue is appropriate. It is not in dispute that the ITO has jurisdiction to pass the impugned order, and what the petitioner complains is that order is incorrect or is in contravention of the provisions of law. This is not a case of total lack of jurisdiction and, therefore, the petitioner is bound to adopt the remedy of filing an appeal.

7. A faint attempt was made to urge that the ITO has not given any reasons for his conclusion and as laid down by the Supreme Court, it is necessary for a quasi-judicial authority to give reasons in support of the conclusion, and more so when an appeal is provided, and, therefore, the order should be quashed in writ jurisdiction. I am not impressed by the submission, because it is open for the appellate authority to consider the material on record and pass an appropriate order.

8. A reference was also made to my decision in Shardaben Mafatlal v. Karandikar [1982] M LJ 732, where sitting in a Division Bench, I had observed that there is no hard and fast rule that the High Court will not entertain a petition under article 226 of the Constitution when there is a remedy of appeal available to a litigant. In that decision, we declined to drive the litigant to file an appeal for several circumstances, and we had not concluded, as now claimed by the petitioner, that in every case where the petition is admitted and pending in this court for two years, the litigant should not be driven to file an appeal. It was also urged by the petitioner that the learned single judge, who admitted the petition, was satisfied about the maintainability of the petition and, therefore, I should not decline to grant relief to the petitioner by upholding the preliminary objection. There is no merit in this submission, because there was no speaking order of the learned judge at the stage of admission, and it was impossible to conceive how the respondents could be precluded from raising preliminary objection, merely because the learned single judge had admitted the petition. In my judgment, the proper remedy for the petitioner is to file an appeal and on this ground, I decline to exercise my jurisdiction and dismiss the petition.

9. Accordingly, the rule is discharged with costs.


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