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Cawnpore Chemical Works P Ltd and anr No 2 Vs Commissioner of Income Tax and anr

Allahabad High Court May-21-1991 Category: Bench: 1.0 1991
Cawnpore Chemical Works P Ltd and anr No 2 Vs Commissioner of Income Tax and anr

R.K. Gulati, J.

1. The first petitioner, the Cawnpore Chemical Works (P.) Ltd., is a private limited company incorporated under the provisions of the Companies Act?' 1956, and the second petitioner is its managing director. It appears that the first petitioner was assessed to surtax under the Companies (Profits) Surtax Act, 1964, for the assessment years 1978-79 and 1979-80. It paid certain amounts as surtax under the provisional assessment orders in respect of the said years. On completion of the regular assessments and when the matter came to be decided by the appellate authorities for those years, the first petitioner became entitled to a certain refund which was duly refunded. The first petitioner thereafter moved the second respondent, namely, the Assistant Commissioner of Income-tax, Central Circle-25, New Delhi, by means of an application, claiming that it was also entitled to interest in terms of Section 244(1A) of the Income-tax Act, 1961, on the amount of surtax refunded to it. That claim, however, was rejected by the second respondent by his order dated December 3, 1990, which was purported to have been passed under Section 154 of the Income-tax Act. Despite the rejection of that application, the petitioners moved this court by means of a writ petition being Writ Petition No. 1547 of 1990 (see : [1992]195ITR620(All) ), on the allegations that the petitioner's application for grant of interest was not being disposed of and, in any case, no order had been communicated to the petitioners. The said writ petition was finally disposed of by this court by its order dated April 2, 1991, with the direction that it would be open to the petitioner to approach the authority concerned for communication of a copy of the order disposing of the petitioners' application. If such an application is made, the authority concerned shall supply a copy of such an order within two weeks of filing of such application. However, if the said application had not so far been disposed of, the same might be disposed of accordingto law within a period of one month of production of a certified copy of that order before the respondent. In pursuance of the order passed by this court, the second respondent has passed the impugned order dated April 15, 1991, in which it has been noticed that the application filed by the petitioner had been disposed of by the order dated December 3, 1990, and a copy of that order was duly served at the Delhi office of the petitioners on December 5, 1990. He further observed that in view of the direction issued by this court, the petitioners' claim was again being considered which was rejected on merits. It is in this background that the present writ petition has been filed by the petitioners impugning the order dated April 15, 1991, passed by the second respondent.

2. We have heard learned counsel for the petitioners. We do not feel inclined to go into the merits of the contention raised by the petitioner's counsel inasmuch as, in our opinion, the writ petition is liable to be dismissed on the ground of alternative remedy. The only contention raised before us was that the impugned order was not liable to be sustained as it proceeds on an erroneous view by misconstruing the relevant provisions of the Surtax Act and the Income-tax Act on which it is based.

3. In our opinion, against the impugned order, the petitioners have an ample efficacious and alternative remedy to seek redress of their grievances. Learned counsel for the petitioners did not dispute the legal position but he contended that the existence of an alternative remedy is no bar to seeking relief under article 226 of the Constitution of India. It is true that the existence of an alternative remedy is not an absolute bar to the issuance of an appropriate writ but, at the same time, the writ jurisdiction is not meant to shortcircuit or circumvent the statutory procedures. The exercise of this jurisdiction should be very sparing and is to be exercised where a clear case in that behalf is made out. A writ will not ordinarily be issued by the court merely because the order complained of is erroneous on points of fact or law, the order otherwise being within the jurisdiction and competence of the authority making it. Resort to the extra legal remedy by taking recourse to article 226 of the Constitution may have some justification where the statutory remedies are entirely inadequate or ineffective to meet the situation but where there exists an alternative and equally efficacious remedy to redress the wrong, the discretion of the court to permit the litigant to invoke its extraordinary jurisdiction may not be its proper exercise.

4. In Assistant Collector of Central Excise v. Dunlop India Limited : 1985ECR4(SC) , the Supreme Court has observed (headnote) :

'... 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 vindication of public justice require it, that recourse may be had to article 226 of the Constitution. But then the court must have good and sufficient reason to bypass the alternative remedy provided by the statute. Surely matters involving the Revenue where the statutory remedies are available are not such matters.'

5. The case on hand, in our opinion, is not one which falls in the exceptional category where the petitioners can be permitted to bypass the statutory remedies available under the Surtax Act where they can seek complete relief on their showing that they are well-founded in their stand. There was no suggestion that the provisions under which the order was passed were ultra vires or that in making the impugned order, there was lack of jurisdiction on the part of the second respondent or that the order was passed in breach of the principles of natural justice. As already observed, the only attack against the impugned order was that the same was erroneous having regard to the scope and true construction of the relevant provisions under which the order was made. Learned counsel for the petitioner was unable to advance any plausible argument as to why the petitioners should be permitted to abandon the statutory remedies provided under the Act, particularly when the relief sought through this petition can be granted by the statutory authorities as well. In this view of the matter, we refrain from going into the merits of the petitioners' case and leave the petitioners to have recourse to the alternative remedy that may be available to them under the Companies (Profits) Surtax Act, 1964, for seeking redress of their grievances. However, we may observe that if the petitioners choose to avail of the alternative forum, the authority concerned may decide the petitioners' case expeditiously.

6. Subject to the above, the writ petition is rejected summarily.

7. A certified copy of this order may be issued to the petitioners, if possible, within four days on payment of usual charges.