JUDGMENT
1. In this application the petitioner seeks appropriate writs and orders directing the respondents, their servants and agents to recall show-cause notice dated May 13, 1964, and to forbear from giving effect to the same.
2. The petitioner is a public company incorporated under the Indian Companies Act, 1956, its registered office being at Birlanagar, Gwalior, Madhya Pradesh. The petitioner submitted its return of income for the assessment year 1955-56 and this income was duly assessed and an order was made on January 31, 1956, by the Income-tax Officer “A” Ward, Jaipur. Thereafter, the Income-tax Officer wrote several letters to the petitioner requesting the petitioner to meet him in connection with proceedings under section 23A of the Income-tax Act, 1922 (hereinafter referred to as the Act). The petitioner contended that it was a company in which the public was substantially interested, and for that reason section 23A was not attracted.
3. On April 21, 1959, the Central Board of Revenue made an order transferring the petitioner's case to the respondent No. 1. By an order dated February 25, 1960, under section 23(3) read with section 34(1)(b) of the Act, the Income-tax Officer included certain items of income not previously included in the original assessment. An appeal was preferred against the said order before the Appellate Assistant Commissioner, but this appeal was dismissed on September 20, 1960. Thereafter, by another order dated September 22, 1960, made under section 23(3) read with section 34(1)(b) of the Act, certain further items of income were included in the assessment of the petitioner. By letters dated June 27, 1962, and December 14, 1962, the respondent No. 1 requested the petitioner to submit certain particulars regarding proceedings under section 23A of the Act. These particulars were furnished by the petitioner. By a letter dated February 15, 1963, the petitioner, through its advocate, contended that no order under section 23A of the Act could be made in respect of the assessment year 1955-56, having regard to the provisions in section 34(3) of the Act.
4. Thereafter, a show-cause notice dated May 13, 1964, was issued by the respondent No. 1 whereby the petitioner was informed that upon scrutiny of the record for the year of account, relevant for the assessment year 1955-56, it was noticed that the petitioner had not declared any dividend in spite of available surplus. The petitioner was further informed by this notice that the respondent No. T proposed to apply the provisions of section 23A of the Act to the petitioner, and called upon the petitioner to show cause within a week why such an order should not be made. At a hearing on June 24, 1964, the petitioner's representative contended before the respondent No. I that the latter had no jurisdiction to pass any order under section 23A, in view of the provisions of section 34(3) of the Act. The respondent No. 1, however, threatened to proceed in pursuance of the said show-cause notice and thereupon the petitioner obtained this rule nisi.
5. The main contention of the petitioner is that an order under section 23A of the Act is an order of assessment or reassessment within the meaning of the said Act, including section 34(3) thereof. It is next contended that, assuming that section 23A of the Act is attracted, the petitioner first became assessable under this section during the assessment year 1955-56 which ended on March 31, 1956. Under the provisions of the said section 34(3), the respondent No. 1, it is contended, has no jurisdiction to make any order of assessment or reassessment after the expiry of four years from April 1, 1956. It was, therefore, argued that the respondent No. 1 had no jurisdiction to assess or reassess the petitioner's profits or gains on the basis of the impugned notice dated May 13, 1964. It is for this reason that the petitioner contends that the respondent No. 1 should be directed to cancel or withdraw the said show cause notice dated May 13, 1964. In other words, the petitioner's contention is that because no order can be made by reason of the bar imposed by section 34(3) of the Act, the issue of the said show cause notice by the respondent No. 1 is illegal, and this notice should, therefore, be cancelled or withdrawn or quashed. The further contention of the petitioner is that the issue of the said show cause notice by itself is an act in excess of the jurisdiction of the respondent No. 1 and, therefore, appropriate writs should be issued prohibiting any further action on the basis of the said impugned notice.
6. Mr. A.K Sen, learned counsel for the petitioner, argued that the petitioner was entitled to relief as by the said notice dated May 13, 1964, the respondent No. 1 proceeded to do something which he could not do. It was argued that an order under section 23A of the Act was an order of assessment and, therefore, such an order was subject to the bar imposed by section 34(3) of the Act. It was also argued that it was plain from the terms of the said notice, that the respondent No. 1 was of the opinion that section 23A of the Act applied, and for that reason the petitioner was liable to pay additional super-tax. But, it was argued, an order of assessment or reassessment could not be made by reason of the bar imposed by section 34(3) of the Act; and therefore the notice calling upon the petitioner to show cause why an order under section 23A should not be made, could not be issued by the respondent No. 1.
7. Mr. Sen next argued that the Finance Act of 1955 amended section 23A of the Act, and after this amendment the section itself became a charging section, which empowered the Income-tax Officer to make an order that the assessee should be liable to pay super-tax at certain rates specified therein; but before the amendment, section 23A had merely provided the conditions under which an order could be made; in other words, it was only a computation section, but the order of assessment itself could be made only under section 34 of the Act. After the amendment, however, the position was radically changed and an order of assessment could be made under section 23A of the Act. It was, therefore, argued that since an order could be made under section 23A of the Act, the bar imposed by section 34(3) of the Act deprived the Income-tax Officer of his power to make an assessment order, if the assessment proposed to be made was for a period beyond the period prescribed by section 34(3) of the Act.
8. In respect of the above contention, Mr. Sen, firstly, relied upon a Bench decision of the Gujarat High Court in Navanagar Transport and Industries Ltd. v. Income-tax Officer, Special Investigation Circle A [1964] 54 I.T.R 271.. In that case also the Income-tax Officer issued a notice calling upon the assessee why an order under section 23A should not be made against the assessee. The point regarding the bar of limitation imposed by section 34(3) of the Act, however, was not taken before the Income-tax Officer, who held against the assessee, and, thereafter, the matter went to the Inspecting Assistant Commissioner for his approval, under sub-section (8) of section 23A of the Act, and it was before the Inspecting Assistant Commissioner that the assessee urged the ground regarding the bar imposed by section 34(3) of the Act to an order being made under section 23A. But, before the Inspecting Assistant Commissioner could decide whether he should grant or refuse relief, a writ petition was filed for appropriate relief. One of the grounds urged before the court was that section 34(3) imposed a bar to an order under section 23A. A second ground however was also urged, namely, that the assessee had no commercial profits in respect of which it could be asked to make a further distribution, and if such distribution was ordered, it would amount to distribution of capital, which would be contrary to law. With regard to this second contention, it was held that there was an adequate alternative remedy provided by the Act and this remedy must be pursued by the assessee. It was held that if the assessee failed before the Income-tax Officer on this second ground, it could carry the matter in appeal before the Appellate Assistant Commissioner, and thereafter to the Tribunal and finally, to the High Court on a reference under section 66, if a question of law arose out of the order of the Tribunal. This remedy, it was held, was a specific and adequate alternative remedy available to the assessee, and such remedy must be pursued. On this first ground mentioned above, however, it was held that section 34(3) was general in its application and prescribed a period of limitation for every order of assessment or reassessment, other than an order under section 23 to which clause (c) of sub-section (1) of section 28 applied, or an order of assessment or reassessment in cases falling within clause (a) of sub-section (1) and sub-section (1A) of section 34. The argument advanced in that case was that section 23A before the amendment was merely a computation section, but after amendment it had become an assessment section. It was also argued that section 23A after the amendment was a self-contained section imposing liability to super-tax, and also providing for its computation and determination, and that when an order under the amended section 23A was made, it was an order determining the amount of super-tax payable by the company under that section. It was held that an order under section 23A after its amendment by the Finance Act, 1955, was an order of assessment to which the period of limitation prescribed in section 34(3) applied, and such an order could not, therefore, be made after the expiration of a period of four years from the end of the assessment year. In that view of the matter appropriate writs were issued for relief to the petitioner in that case. Relying upon this decision, Mr. Sen argued that the decision in this case was an authority for the proposition that an order under section 23A of the Act could be made only if the bar imposed by section 34(3) did not apply. But in this case, Mr. Sen argued, the assessment was clearly proposed to be made for a period beyond the period prescribed by section 34(3) of the Act, and therefore the order could not be made, and the impugned notice to show cause also could not be issued.
9. The next case relied upon by Mr. Sen is the decision of the Supreme Court in Commissioner of Income-tax v. Navinchandra Mafatlal, in which it was held that an assessment order could not be made under section 23A of the Act (as it stood before the amendment) as that section did not provide for any assessment being made, and that the assessment of a shareholder consequent on an order of distribution made under section 23A, had to be made under the other provisions of the Act including section 34. The Supreme Court, relying upon its earlier decision in Sardar Baldev Singh v. Commissioner of Income-tax [1960] 40 I.T.R 605 S.C., held that an assessment could not be made under section 23A of the Act (as it stood before the amendment).
10. Mr. Sen next relied upon the decision of the Supreme Court in Sardar Baldev Singh v. Commissioner of Income-tax.
11. The next case relied upon by Mr. Sen was another decision of the Supreme Court in C.A Abraham v. Income-tax Officer [1961] 41 I.T.R 425 S.C.. Reliance was placed on this case for the observations of the Supreme Court that the expression “assessment” used in Chapter IV of the Act did not merely mean computation of income and that this expression was used in the Act with different connotations. I shall, however, refer to this decision in another connection, later in this judgment.
12. The next case relied upon by Mr. Sen was also another decision of the Supreme Court in S.S Gadgil v. Lal & Co., in which it was held that the period prescribed by section 34 of the Act was not a period of limitation and that the section in terms imposed a fetter upon the power of the Income-tax Officer to bring to tax escaped income. This section, it was held, prescribed different periods in different classes of cases for enforcement of the right of the State to recover tax. It was further held that a proceeding for assessment was not a suit for adjudication of a civil dispute and the income-tax authorities, who had the power to assess, and recover tax were not acting as judges deciding a litigation between the citizens and the State, but that they were administrative authorities whose proceedings were regulated by statute, and whose function was to estimate the income of the taxpayer and to assess him to tax on the basis of that estimate.
13. The next case relied upon by Mr. Sen was a decision of the Allahabad High Court in Ram Bilas Kedar Nath v. Income-tax Officer. In that case voluntary returns were filed, and best judgment assessments were made, on these returns on the ground that there was default in complying with notices under sections 22(2) and (4) of the Act. After certain other proceedings, fresh notices were issued under sections 22(4) and 23(2) of the Act, to which an objection was raised that the assessments were barred, as the four-year limit had expired. Thereafter, the Income-tax Officer issued notices for rehearing of certain penalty proceedings under section 28(1)(a) which had been already initiated, and issued notices under section 46(5A) to a third party directing him to withold payment of certain sums due to the assessee. Prior to the issue of the notices under section 28(1)(a), however, notices under sections 22(4) and 23(2) were issued and objections were taken to these notices that the assessments were barred as the four-year period had already expired. The Income-tax Officer, however, did not deal with the question of limitation raised by the assessee, and instead of deciding the question of the bar imposed by section 34, issued the penalty notices under section 28(1)(a). The question of limitation raised by the assesses was not decided by the Income-tax Officer at all. It was on these facts that it was held that the Income-tax Officer had no jurisdiction to continue the proceedings for making a fresh assessment under section 23 in respect of the returns filed under section 22(3) of the Act, after the assessment under section 23(4) had been cancelled by the Income-tax Appellate Tribunal, beyond the normal period of four years. Relying upon this decision, Mr. Sen argued that the court had the jurisdiction to issue appropriate writs where the Income-tax Officer was proceeding to make an order in a matter in which he had no jurisdiction.
14. Mr. Sen also relied upon the decision of the Supreme Court in Calcutta Discount Co. Ltd. v. Income-tax Officer. This decision was relied upon by Mr. Sen in support of his contention that the bar imposed by section 34(3) of the Act was a question of jurisdiction and not one of limitation. Discussing this question the Supreme Court at page 207 of the report held that the scheme of the law was that, where the Income-tax Officer had reason to believe that an under-assessment had resulted from non-disclosure, he should have jurisdiction to start proceeding for assessment within a period of eight years, and where he had reason to believe that an under-assessment had resulted from other causes, he should have jurisdiction to start proceedings for reassessment within four years; and both these conditions must co-exist before the Income-tax Officer had jurisdiction to start proceedings after the expiry of four years. Relying upon this decision, Mr. Sen contended that the question, of the bar imposed by section 34(3) was a question of jurisdiction of the Income-tax Officer to make an order under section 23A of the Act.
15. The next contention of Mr. Sen was regarding scope of the writ of prohibition. He argued that a writ in the nature of prohibition should be issued as soon as the inferior tribunal proceeded to apply a wrong principle of law when deciding a fact on which the jurisdiction depended. In other words, he submitted that the petitioner was not bound to wait until an order was made by the Income-tax Officer, but was entitled to come to court for a writ in the nature of prohibition as soon as it became apparent that the Income-tax Officer was proceeding to make an order, when on the facts such an order could not be made. In support of this contention, reliance was placed upon Halsbury, 3rd Edition, volume II, page 117, article 218. Reliance was also placed on the statement of the law in articles 213 and 214. It was argued that this court had the power to restrain the Income-tax Officer from proceeding to make the order as quite clearly he had no jurisdiction to make such an order.
16. The last contention of Mr. Sen was that an appropriate writ could be issued by this court under article 226, even though the petitioner had an alternative remedy. It was argued that the mere fact that the statute provided another remedy, was no bar to this court's exercising its jurisdiction under article 226, to issue appropriate writ to ensure that justice was done. In support of this contention, Mr. Sen relied upon the decision of the Supreme Court in. State of Uttar Pradesh v. Mohammad Nooh, in which it was held that there was no rule with regard to certiorari as there was with mandamus, that it would lie only when there was no other equally effective remedy. It was further held that certiorari would lie, though a right of appeal had been conferred by statute. But where the aggrieved party had another adequate remedy, the existence of such remedy might be taken into consideration in exercise of the discretion in issuing a writ of certiorari. It was further held that the rule requiring exhaustion of a statutory remedy before certiorari could be issued, was a rule of policy, convenience and discretion, rather than a rule of law. It was further held that the powers conferred by article 226 were given to ensure that justice was done and rule of law prevailed and that narrow or ultra technical restrictions should not be placed on such powers, and that justice should be administered in a “common-sense liberal way and be broad-based on human values rather than on narrow and restricted considerations hedged round with hair-splitting technicalities”. Relying upon this decision, Mr. Sen contended that appropriate writs and orders should be issued to grant relief to the petitioner even though it be held that the statute had conferred upon him an adequate alternative remedy.
17. Mr. Sen argued that the order proposed to be made under section 23A of the Act was an order of assessment, as that section after the amendment had become a charging section and not merely a section which dealt with the computation of the income or the machinery for the assessment. After the amendment, an order under section 23A of the Act would be an order of assessment which would be subject to the bar provided in section 34(3) of the Act. The order proposed to be made would clearly be barred by the provisions in section 34(3) and, therefore, it was argued, the Income-tax Officer had no jurisdiction to issue the impugned show-cause notice.
18. Mr. Gouri Mitter, learned counsel for the respondent No. 1, contended that the application is entirely misconceived. He argued that the application was not maintainable and in any event it was premature as no order had been made by the Income-tax Officer yet. All that the respondent No. 1 had done by the impugned notice, was to call upon the petitioner to show cause why an order under section 23A should not be made. The petitioner appeared before the respondent No. 1 through his representative, and agreed to show cause why the order should not be made, but instead of showing cause, he had come to this court and obtained the present rule. The right to a writ under article 226 or the claim for such a writ, it was argued by Mr. Mitter, would arise only if the Income-tax Officer held against the petitioner on the question raised by him regarding the bar created by section 34(3) of the Act. It was further argued that it was for the Income-tax Officer alone to decide whether the bar imposed by section 34(3) was a fetter on his proceeding to make an order under section 23A of the Act. It may as well be, it was argued, that the Income-tax Officer would accept the contention of the petitioner with regard to the bar created by section 34(3) and in that event the petitioner would have no occasion to ask for any relief in the writ jurisdiction of this court.
19. It was next argued by Mr. Mitter that the show-cause notice merely called upon the petitioner to show cause why an order should not be made under section 23A. The respondent No. 1 alone could come to a decision as to the applicability of the bar under section 34(3). If the respondent No. 1 held against the petitioner on his contention regarding section 34(3), he would be entitled to come to this court and ask for relief either restraining the respondent No. 1 from proceeding to make any further order under section 23A or if an order under section 23A had been made, the petitioner would still be entitled to come to this court and ask for a writ in the nature of certiorari quashing any such order.
20. In support of the above contention Mr. Mitter firstly relied on the decision of the Supreme Court in Lalji Haridas v. R.H Bhatt. In that case, the assessee applied for a writ under article 226 to quash two notices issued by the Income-tax Officer and also to quash an assessment order made against him. The petition was dismissed by the High Court, and against this dismissal an appeal was preferred to the Supreme Court. An assessment order was made whereby income-tax was assessed on a sum of Rs. 4,74,046. Before this order was made, a notice was issued under section 46(1)(a) of the Saurashtra Income-tax Ordinance, 1949, which corresponds to section 34(1)(a) of the Indian Income-tax Act. In answer to this notice the assessee made a return showing an income of Rs. 46 only. It had come to the knowledge of the Income-tax Officer that large sums had been credited in the account of the assessee, and attempt was made by the assessee to explain these credits by saying that these amounts did not represent his income but were benami transactions. Against the order of assessment, the appellant preferred an appeal to the Appellate Assistant Commissioner. It was contended before the appellate authority that some of the witnesses were not examined and that the evidence of other witnesses was not properly recorded. The appellate authority remanded the proceedings to the Income-tax Officer, and directed him to submit a report after examining the witnesses. After this order of remand was made, the assessee was called upon to appear before the Income-tax Officer and produce his evidence. But instead of complying with this requisition, the appellant moved the Gujarat High Court on the writ petition mentioned above, but he also preferred an appeal from the assessment order of the Appellate Assistant Commissioner to the Income-tax Appellate Tribunal. Dealing with the contention raised on behalf of the appellant, the Supreme Court at page 418 of the report held as follows:
“Mr. Pathak for the appellant attempted to argue that the notice issued against the appellant is, on the face of it, invalid, because it is barred by time. We did not allow Mr. Pathak to develop this point, because we took the view that a plea of this kind must ordinarily be taken before respondent No. 1 himself. The jurisdiction conferred on the High Court under article 226 is not intended to supersede the jurisdiction and authority of the Income-tax Officers to deal with the merits of all the contentions that the assessees may raise before them, and so it would be entirely inappropriate to permit an assessee to move the High Court under article 226 and contend that a notice issued against him is barred by time. That is a matter which the income-tax authorities must consider on the merits and in the light of the relevant evidence.”
21. Relying on this decision, Mr. Mitter contended that the law on this question was well-settled, and that it was entirely for the respondent No. 1 to decide if the petitioner was entitled to the benefit of the bar created by section 34(3) of the Act. No order had yet been made, Mr. Mitter argued, against the petitioner on the contentions raised by him before the respondent No. 1, and the writ jurisdiction of this court could not supersede the jurisdiction and authority of the respondent No. 1 to deal with the merits of the contentions raised by the petitioner.
22. Mr. Mitter next relied upon an earlier decision of the Supreme Court in Chhotalal Haridas v. M.D Karnik. In that case, notices were issued by the Income-tax Officer against the assessee, by which an enquiry was proposed to be held with regard to the liability of the assessee to pay tax on an alleged total income of Rs. 97,00,000. The validity of these notices was sought to be challenged on the ground that the assessment proceedings commenced against the appellant were barred by limitation under section 34(3) of the Act, and it was further argued that the initiation of the proceeding itself was without jurisdiction and as such illegal. Dealing with this question, the Supreme Court at page 390 of the report held as follows:
“The question of limitation can and ought to be raised by the appellant before the Income-tax Officer; that is not a point which can be legitimately agitated in writ proceedings. We, therefore, do not propose to deal with this point. If the appellant is so advised, he may raise this point before the first respondent and we have no doubt that if it is so raised, the first respondent will deal with it in accordance with law.”
23. Relying on these observations Mr. Mitter argued that this is precisely the point which was raised by the petitioner in this application. The petitioner's only contention before this court was that as an assessment order under section 23A was barred by limitation under section 34(3) of the Act, the Income-tax Officer had no jurisdiction to issue the notice itself calling upon the petitioner to show cause why an order should not be made under section 23A of the Act. Mr. Mitter argued that the Supreme Court had expressly negatived this contention which was raised by the appellant in the above case and it was, therefore, not open to the petitioner to contend that the Income-tax Officer had no jurisdiction in the matter. Indeed, Mr. Mitter agued, the Income-tax Officer alone could come to a decision on the contention raised by the petitioner including the contention regarding the bar of limitation created by section 34(3) of the Act.
24. Relying upon the two decisions of the Supreme Court, Mr. Mitter contended that the law is now well-settled, and there is no room for doubt that this court in exercise of its writ jurisdiction should not deal with the contentions raised by the petitioner regarding the bar of limitation created by section 34(3) of the Act. It was argued that it was not open to the petitioner to contend that the respondent No. 1 had no jurisdiction to deal with the question.
25. In my view, the contentions of Mr. Mitter are well-founded. The two decisions of the Supreme Court discussed above, have set at rest any controversy on the question whether an Income-tax Officer has jurisdiction to deal with the question of limitation raised by an assessee. The statute had created a bar of limitation regarding assessment orders in certain cases. The statute has also given the income-tax authorities the power to make such assessment order in cases where the bar of limitation did not apply. It was for the income-tax authorities, therefore, to decide whether an assessment order could be made having regard to the contentions raised on behalf of the petitioner. It is not, in my view, a case of inherent lack of jurisdiction. Indeed, it is the income-tax authorities alone who have the jurisdiction to come to a decision on the question of the bar of limitation and they must decide this question. The writ jurisdiction of this court cannot, in my view, be invoked for a decision in the matter in which the statute has expressly conferred jurisdiction upon the income-tax authorities.
26. It cannot be overlooked that sub-section (3) of section 34 of the Act imposes a bar on an order of assessment or reassessment in certain specified cases mentioned therein. But there is no bar imposed by this sub-section to the issue of a notice by the respondent No. 1 calling upon the petitioner to show cause why an order should not be made under section 23A of the Act. And that is all that has been done in this case by the respondent No. 1. No order of assessment or reassessment has yet been made, but the petitioner has been merely called upon by the impugned notice, to show cause why an order of assessment under section 23A of the Act should not be made. The statute does not prohibit or restrain the income-tax authorities from issuing such a notice and it cannot be said that the issue of the notice has been made in violation of the provisions in the statute.
27. The next contention of Mr. Mitter was that the application is misconceived and the petitioner is not entitled to any relief whatsoever. He argued that no writs should be issued or order made to give any relief to the petitioner. The Income-tax Act, it was argued, provided a complete machinery for relief to the petitioner, if he was entitled to any such relief, and this court should not permit the petitioner to come to this court on a writ petition for relief when he could seek the same relief by pursuing the remedies provided by the Act itself. In support of this contention, reliance was placed by Mr. Mitter on the observations of the Supreme Court in C.A Abraham v. Income-tax Officer to which reference has already been made earlier in this judgment. In that case the assessee was aggrieved by an order of the Income-tax Officer assessing certain suppressed incomes. A show cause notice was issued why penalty should not be imposed and, after considering the explanation of the assessee, various penalties were imposed. Appeals against the orders imposing penalty were dismissed, and thereafter the appellant applied to the Kerala High Court for a writ of certiorari. This application was rejected and thereupon an appeal was preferred to the Supreme Court. It was held at page 428 of the report as follows:
“In our view, the petition filed by the appellant should not have been entertained. The Income-tax Act provides a complete machinery for assessment of tax and imposition of penalty and for obtaining relief in respect of any improper orders passed by the income-tax authorities, and the appellant could not be permitted to abandon resort to that machinery and to invoke the jurisdiction of the High Court under article 226 of the Constitution when he had adequate remedy open to him by an appeal to the Tribunal.”
28. This view was confirmed and reiterated by the Supreme Court in Shivram Poddar v. Income-tax Officer. In that case a firm consisting of four partners was dissolved and thereupon its business was discontinued. One of the partners submitted a return of the income of the firm for the year 1949-50 and on this return, an assessment order was made. Later on, the Income-tax Officer issued a notice under section 34 read with section 22(2) of the Act calling upon one of the partners to submit a return of the income of the firm for the year ending March 31, 1950. One of the partners moved this court for a writ of mandamus and his petition was dismissed; this order of dismissal was confirmed on appeal, and, thereafter, an appeal was taken to the Supreme Court; dealing with the question of maintainability of the writ petition, it was held at page 829 of the report as follows:
“We may observe that we have proceeded to decide this case on the footing that the business of the firm was discontinued on the dissolution of the firm. It is, however, necessary once more to observe, as we did in C.A Abraham's case, that the Income-tax Act provides a complete machinery for assessment of tax, and for relief in respect of improper or erroneous orders made by the revenue authorities. It is for the revenue authorities to ascertain the facts applicable to a particular situation, and to grant appropriate relief in the matter of assessment of tax. Resort to the High Court in exercise of its extraordinary jurisdiction conferred or recognised by the Constitution in matters relating to assessment, levy and collection of income-tax may be permitted only when questions of infringement of fundamental rights arise, or where, on undisputed facts, the taxing authorities are shown to have assumed jurisdiction which they do not possess. In attempting to by-pass the provisions of the Income-tax Act by inviting the High Court to decide questions which are primarily within the jurisdiction of the revenue authorities, the party approaching the court has often to ask the court to make assumptions of facts which remain to be investigated by the revenue authorities.”
29. Relying upon the two decisions of the Supreme Court discussed above, Mr. Mitter argued that no writ should be issued in this application and no relief should be granted to the petitioner, who had invoked the extraordinary jurisdiction of the court in a matter, in which the statute had provided the machinery for relief, if the order made by the revenue authorities was an improper order or the petitioner was otherwise aggrieved by such an order. It was argued that the law on the question whether, on a case such as this, writs and orders should be issued under article 226, has been settled by the Supreme Court by the two decisions mentioned above. It was further argued that there were no grounds in this petition why the court should give relief to the petitioner in exercise of its extraordinary jurisdiction under article 226 of the Constitution, when the Act provides for complete relief, if the petitioner was aggrieved by any order made against him. Mr. Mitter submitted that the instant case stood on a much stronger footing, because no order had yet been made by the income-tax authorities against the petitioner. The petitioner, Mr. Mitter argued, had no reason to feel aggrieved merely by the issue of the impugned show-cause notice.
30. In my opinion, this contention of Mr. Mitter is sound. The Act provides a complete machinery for remedy if an assessee is aggrieved by any order made against him. It is true that the mere fact that there is an alternative remedy is no bar to the issue of appropriate writs for relief in a case where the petitioner is entitled to such relief, as was held by the Supreme Court in State of Uttar Pradesh v. Mohammad Nooh. This court undoubtedly has a discretion to issue writ of certiorari even in a case where there is an alternative remedy. But the grounds on which such discretion is to be exercised have been settled by the decisions of the Supreme Court discussed above. On the facts of this case can it be held that the petitioner is entitled to invoke the extraordinary jurisdiction of this court for relief? Can it again be held that the petitioner is justified in not taking resort to the remedy available to him under the Income-tax Act? I think not. No order has yet been made against the petitioner, and, therefore, it has no cause to feel aggrieved. The petitioner has merely been called upon to show cause why an order under section 23A of the Act should not be made against it. The plea of the bar created by section 34(3) of the Act raised by the petitioner in this petition can as well be raised by it before the revenue authorities, who alone have the power to issue the impugned notice calling upon the petitioner to show cause why an order should not be made under section 23A of the Act. There is no bar in law to the issue of the notice. The bar is to the making of an order of assessment or reassessment in those cases where the bar of limitation created by section 34(3) of the Act applies. For the reasons mentioned above, the petitioner is not entitled to any relief in this application which must, therefore, be dismissed. The rule is discharged. Each party to pay its own costs.
31. Application dismissed. Rule discharged.