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Havukal Estate Company Vs. Income-tax Officer, Circle I(1), Ootacamund. - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtChennai High Court
Decided On
Case NumberWrit Petition No. 3225 of 1967
Reported in[1973]87ITR50(Mad)
AppellantHavukal Estate Company
Respondentincome-tax Officer, Circle I(1), Ootacamund.
Excerpt:
- .....as the earlier, officer allowed the deduction, the officer who took a different view for the later year or years cannot assume jurisdiction to issue a notice under section 147 of the income-tax act to reopen a closed assessment as if there was an escapement in its. this is opposed by the revenue on the ground that the respondent has jurisdiction to issue the notice and a writ of prohibition cannot issue at this stage as the petitioner cannot say that the respondent cannot enquire into the subject-matter for want of jurisdiction.i agree that with the revenue. it cannot be said that this is a case which poses a total or complete absence of jurisdiction on the part of the office to issue the notice challenged herein. obviously as stated in the counter-affidavit, the income-tax officer who.....
Judgment:
ORDER

RAMAPRASADA RAO, J. - The petitioner took on lease a tea estate known as 'Rajarajeswari Estate' measuring about 54.41 acres for a period years from its owner by lease, deed dated, 21st October, 1964. Inter alia, the petitioner was obliged to pay a monthly rent to the owners in considerable of the lease obtained by him. In the year 1965-66 the petitioner claimed a sum of Rs. 13,364 amongst other as revenue expenditure through this represent the annual rent paid by him to the landlords. This was accepted by the Income-tax Officer and by his order dated February 24, 1966, the rent was accepted as an allowable deduction. It is common ground that for the subsequent years the original income-tax authority did not accept his amount paid by way of rent as revenue expenditure and disallowed the expenditure and expressed the view that it ought to be disallowed. With this object in view, the respondent gave a notice dated September 23, 1967, calling upon the petitioner as to why the earlier order for the year 1965-66 should not be reopened as there was an escapement of assessment while the assessment order was passed for that year. On receipt of this notice the petitioner has come up to this court for the issue of a writ of prohibition stating that, as the earlier, officer allowed the deduction, the officer who took a different view for the later year or years cannot assume jurisdiction to issue a notice under section 147 of the Income-tax Act to reopen a closed assessment as if there was an escapement in its. This is opposed by the revenue on the ground that the respondent has jurisdiction to issue the notice and a writ of prohibition cannot issue at this stage as the petitioner cannot say that the respondent cannot enquire into the subject-matter for want of jurisdiction.

I agree that with the revenue. It cannot be said that this is a case which poses a total or complete absence of jurisdiction on the part of the office to issue the notice challenged herein. Obviously as stated in the counter-affidavit, the Income-tax Officer who succeeded the earlier officer was of the view that the allowance of the expenditure in the earlier year was wrong and that the matter required re-scrutiny in view of certain decision of the Supreme Court and other material. It was such a situation that the respondent initiated the proceedings under section 147(b) on the basis of information made a available to him both the record and otherwise. That the cannot be said to be an unreasonable attitude on the part of the respondent. Certainly, it cannot be said that the impugned notice was issued without jurisdiction. As a writ of prohibition one of to interdict the exercise of jurisdiction and as the petitioner can succeed only if he establishes that in no circumstances such action by the respondent can be countenanced, such a writ cannot issue from this court under article 226. In the instant case, it cannot be said with certainty that there is no material on which the Income-tax Officer has acted and this is not a case where the notice was issued without jurisdiction or without statutory authority. In these circumstances, the rule nisi is discharged and the writ petition is dismissed. No costs.


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