This is an application by Ramniranjan Kedia under Article 226 of the Constitution in an income-tax matter,
2. Though the application is a long one running into 44 paragraphs, the brief and salient facts on which it is based are these --
3. A notice was issued to the applicant under Section 34(1), Income-tax Act (hereinafter called the Act), on 27-3-1954, by the Income-tax Officer, Ajmer, in connection with the assessment year 1945-46, apparently on the ground that certain income had escaped assessment. The applicant appeared before the Income-tax Officer, and objected to the jurisdiction of the Income-tax Officer to assess him under that section.
The case came for disposal to the VII Additional Income-tax Officer, Ajmer, stationed at Udaipur, and that Officer ordered levy of tax amounting to Rs. 2,92,665-5-0 on the applicant by an order of March 1955. The applicant has preferred, an appeal against that order, and the appeal is pending before the Appellate Assistant Commissioner of Income-tax. The applicant wanted stay of realisation of tax from him. That stay has, however, not been secured by him. Later a penalty of Rs. 15,000 was imposed on the applicant in July 1955, under Section 46(1) of the Act.
This order is also open to appeal under Section 30 of the Act, subject to the proviso that no appeal shall He against an order under Sub-section (1) of Section 46 unless the tax has been paid. The applicant has not filed an appeal against the order of penalty because he is already disputing the tax levied upon him. The main grievance of the applicant, therefore, seems to be that the realisation of tax from him is not being stayed even though his appeal is pending, and he has put it in these words in para. 43 --
'That although your petitioner has preferred appeals against the orders in question, the appellate authorities are wholly powerless in this behalf and cannot control or check the ruinous activities of the oppose party (namely Income-tax Officers) and your petitioner has no remedy but to seek shelter and protection under the High Prerogative powers of this Hon'ble High Court, for by the time the appeals may be decided the opposite party may successfully deprive your petitioner of substantially huge amounts ofmoney to the utter ruin of his business and reputation, and a decision of the appeal may be too late to save the situation.'
4. The question that calls for consideration is whether this Court should interfere under Article 226 of the Constitution at this stage,
5. The Income-tax Act is a self-contained Act providing for collection of income-tax. It has provided appeals against orders of Taxing Authorities, first, to the Appellate Assistant Commissioner, and then to the Appellate Tribunal. It has also provided for reference of questions of law to this Court by the Appellate Tribunal. It has also given powers to this Court to order the Appellate Tribunal to refer any question of law in case the Appellate Tribunal has refused to do so on an application made by the assessee.
The main point involved in this case is a question of law, namely whether, on the law as it stands, the Income-tax Officers concerned had the jurisdiction to issue notice to the applicant under S, 34 and to assess him. The applicant has already filed an appeal to the relevant authority against the order of assessment, and that is awaiting decision. He, however, wants this Court to intervene at this stage before his remedies under the Income-tax Act in the matter of assessment are exhausted. The question, therefore, arises, so far as the assessment matter is concerned, whether this Court should intervene under Article 226 at this stage.
6. We have given the matter our earnest consideration, and are of opinion that we should not exercise our powers under Article 226 in the case of a self-contained Statute like the Act, when there is no allegation of the invalidity of any provision of the Act, and the allegation only is that a particular Income-tax Officer was acting without jurisdiction in taking action, under Section 34, and in assessing the applicant.
If this Court were to interfere like this, the whole procedure provided in the Act for assessment and realisation would be thrown out of gear, and the provisions of appeals under Section 30 and reference under Section 66 would be rendered nugatory.
7. Learned counsel in this connection drew our attention to Gangadhar v. State of Rajasthan, AIR 1953 Raj 71 (A). In that case, reference was made to Halsbury's Laws of England, Second Edition, Volume IX, paragraph 1397, where the following passage occurs--
'The Court, in deciding whether or not to grant a writ of prohibition will not be feitered by the fact that an alternative remedy exists to correct the absence or excess of jurisdiction, or an appeal lies against such absence or excess'.
Prohibition lies to correct an assumption of jurisdiction by a Tribunal which has not got jurisdiction, and has to be applied for before the Tribunal decides the matter. It would have been a different matter if the applicant had come to us as soon as the Income-tax Officer issued notice to him questioning the jurisdiction of that officer. But after the Income-tax Officer has decided the matter and levied a tax on the applicant, there is no question now of prohibiting him from exceeding his jurisdiction.
If his order is without jurisdiction, he has already exceeded it, and there can only be the issue of awrit of certiorari, if the order is in excess of jurisdiction, A writ of certiorari is always a discretionary writ, and in a case like the present where there are other remedies provided in a fiscal. Statute open to the applicant including the remedy of coming to this Court on reference under Section 66 of the Act, there is, in our opinion, no reason for us to interfere under Article 226 of the Constitution at this stage so far as the assessment order is concerned.
8. Learned counsel also drew our attention toS. C. Prashar v. Vasantsen Dwarkadas, (S) AIR 1956Bom 530 (B). In that case, it was held that 'a patentwant of jurisdiction entitles the petitioner to. obtainimmediate relief from the High Court, even thoughhe could raise the plea of want of jurisdiction in ahigher Tribunal.' We may, however, point out thatthat was a case in which the party went to the HighCourt immediately on the issue of the notice under Section 34, and did not wait for the Income-tax Officer tocomplete his assessment.
9. We are further of opinion that there is no necessity for us to interfere under Article 227 of the Constitution for the same reason.
10. As for the order imposing penalty under Section 46(1} learned counsel for the applicant urges that the remedy of appeal provided by Section 30 is not an adequate remedy inasmuch as the proviso lays down that a person can only appeal after paying the tax. In this connection, he drew our attention to Anglo-India Jute Mills Co. Ltd. v. S. K. Dutt, AIR 1956 Cal 450 (C).
In that case it was held that 'where a Statute requires the entire money to be paid or deposited before an appeal could be preferred, that is not an alternative remedy which is adequate.' Assuming this view of the law to be correct (though we should like to reserve our final opinion on it), the applicant does not stand to gain anything by our deciding merely the question of penalty. The penalty has been imposed because the tax has not been paid.
Whether the tax has been properly levied is a question which is under appeal. Any order under Section 46(1) would fail if it is held that the tax is not properly levied. Therefore, the main question which has to be decided is whether the applicant has been properly assessed on a notice under Section 34(1), and that question is before the proper appellate authority. We have held that that question should not be gone into by this Court at this stage.
In this view of the matter, we are of opinion that it is not worthwhile going into the question of penalty at this stage for the penalty will fall with the assessment immediately the applicant succeeds. If the applicant fails on the question of assessment, all that we need say is that we would not be disposed to interfere with the penalty.
11. We, therefore, dismiss the application in limine.