Dell India (P) Ltd. vs Joint Commissioner of Income Tax and Others

Aravind Kumar, J.—Joint CIT(LTU), Bengaluru sought to reassess the petitioner in respect of its income for the asst. yr. 2009-10 under s. 147 of the IT Act, 1961 (for short referred to as ''Act''), by issuing of notice under s. 148 of the Act. Petitioner has challenged the notice issued for reassessment and order passed by first respondent holding that there is no error of jurisdiction. In order to examine the issue involved in this present petition facts relevant for the said purpose require to be noticed which are as under. Petitioner is engaged in the manufacture and sale of computer hardware and related products. For the asst. yr. 2009-10 which relates to financial year 2008-09 return of income came to be filed on 30th Sept., 2009 declaring a total loss of Rs. 39,56,399. Under s. 143(3) of the Act assessment was taken up and after the details called for by the AO and same being produced a draft assessment order came to be passed on 28th March, 2013 proposing to make several additions to the income of the petitioner. Petitioner filed its objections to draft assessment order before Dispute Resolution Panel, which ultimately confirmed the proposed addition to the income of the petitioner on the basis of which order under s. 143(3) r/w s. 144C of the Act came to be passed on 31st Jan., 2014, Annex. H. Being aggrieved by the same petitioner is said to have filed an appeal and same is filed before first appellate authority and same is pending.

First respondent has issued a notice under s. 148 of the IT Act to the petitioner-assessee on 27th March, 2014 Annex. K indicating thereunder that he has reason to believe that income in respect of which petitioner assessee is assessable to tax for the asst. yr. 2009-10 has escaped assessment within the meaning of s. 147 of the Act. Hence, in order to assess/reassess the income under s. 147 of the Act petitioner-assessee was called upon to file the return in the prescribed form within 30 days from the date of service of notice. Petitioner by communication dt. 15th April, 2014 Annex. L intimated the first respondent that return of income filed on 30th Sept., 2009 be treated as the return of income filed in response to notice issued under s. 148 of the Act. At the same time petitioner also called upon the first respondent to furnish reasons for initiating reassessment proceedings. Pursuant to the same, AO namely first respondent intimated the petitioner by communication dt. 25th April, 2014 Annex. M, reasons for reopening indicating thereunder that deferred revenue totaling Rs. 2,16,89,00,773 which was deferred in the asst. yr. 2009-10 was not added while computing total income for the relevant assessment year and petitioner ought to have admitted said revenue in the asst. yr. 2010-11 and having not offered same to tax in the subsequent assessment year i.e., asst. yr. 2010-11. Similarly, reconciliation between sale of goods as per sales-tax return and sale of goods as per IT return had been requested which was furnished and on examination it was noticed that smart debits deferred revenue amounting to Rs. 2,16,89,00,773 for the asst. yr. 2009-10 was not admitted for sales in the asst. yr. 2010-11. On this ground also AO had opined that he had reason to believe that income of Rs. 2,16,89,00,773 assessable to tax has escaped the assessment for the year 2009-10 and as such he proposed to reassess the income of petitioner under s. 147 of the Act. Said reason assigned by the AO on being furnished came to be replied by petitioner-assessee by challenging the same on the grounds indicated in reply dt. 9th May, 2014 Annex. N. AO after considering the said reply rejected the contentions raised for the reasons indicated in the communication dt. 24th Feb., 2015 Annex. P which reads as under:

"1. It was seen that amount deferred in the asst. yr. 2009-10 totalling Rs. 2,16,89,00,773 was not offered to tax in subsequent year i.e., asst. yr. 2010-11. In your submission you have not been able to convincingly demonstrate that the above said amount was offered to tax in asst. yr. 2010-11. The table in the submission does not show it.

Reopening under s. 148 in your case for the asst. yr. 2009-10 is not based on a mere change of opinion but is based on the fact that an amount of Rs. 2,16,89,00,773 which was deferred in asst. yr. 2009-10 has not been offered in the subsequent assessment year.

Regarding deferment of revenue, the DRP in its order for asst. yr. 2010-11 has upheld the stand taken by the AO that such deferral may work against Revenue not just because it is not permitted under the IT Act but also because TDS credit is claimed in full in the year in which revenue accrues. It is also possible as in the present case that the company may not offer such amount to tax."

Hence, petitioner has approached this Court for quashing of notice issued under s. 148 dt. 27th March, 2014 Annex.-K and order/communication dt. 24th Feb., 2015 Annex.-P passed by first respondent rejecting petitioner''s preliminary objection.

I have heard the arguments of Sriyuths Percy Pardiwalla, learned senior counsel appearing on behalf T. Suryanarayana, for petitioner and K.V. Aravind, learned panel counsel appearing for respondents.

It is the contention of Sri. Percy Pardiwala, learned senior counsel appearing for petitioner that ''mere change of opinion'' would not be a ground for reopening assessment order and particularly when no new material is detected, so as to arrive at a conclusion that there is escaping of declaration by the assessee at the time of filing of return of income. He would contend that it is only on the reason to believe that there is escaping of income AO will get jurisdiction to issue notice under s. 148 and to assume the jurisdiction for reassessment under s. 147 and there must be material available to him on the basis of which he would have reason to believe that income has escaped from assessment and contends there has been total non-application of mind in this regard by AO. He would also contend that there should be rational nexus between the reasons and the belief that income has escaped from assessment and there should be existence of reasons on which a belief can be entertained by AO that income has escaped assessment and mere belief being in existence without backed by reasons would not be sufficient to reopen the assessment. He would also contend that reasoning provided by first respondent for reopening the assessment for the year 2009-10 is that petitioner in the asst. yr. 2010-11 did not offer to tax the revenue which was deferred in the asst. yr. 2009-10 and said ground can only amount to reason to suspect but it cannot be reason to believe escapement of income to tax or such reasons would not be a ground to suspect the return of income filed by the petitioner at the first instance to reopen the assessment. On facts he would contend that petitioner which is engaged in the sale of computer hardware and related products has offered to its customers installation and warranty service which does not necessarily come to end in the year of sale but may be spread over a period of two or more accounting years and as such petitioner recognizes the said revenue proportionately over the period of service contract and offers to tax in the subsequent assessment years when the obligation to render services arises. He would also elaborate his submission by contending that entire sale price for sale of products together with warranty and installation are invoiced in a given year and service/sales-tax as the case may be is discharged, the obligation to provide services in that respect and the outflow of resources would happen only in the subsequent years and that therefore, in line with the revenue recognition principles, the revenue from such services would have to be recognized over the period of providing services. He would also contend that revenue to be so recognized in the subsequent years is accounted under the head ''Other liabilities'' in the balance sheet of the petitioner company and this policy is consistently being followed by the petitioner which is in pari materia with the accounting pattern and system formulated by Institution of Chartered Accountant of India. He would draw the attention of the Court to assessment order for the asst. yr. 2009-10 whereunder the AO had an occasion to particularly examine the accounting policy adopted by petitioner and after noticing the explanation offered by the petitioner, AO had accepted the same for the said year with regard to detailed break-up of deferred revenue relating to a total amount of Rs. 2,16,89,00,773 and no disallowance came to be made by the AO on account of revenue itself recognizing the accounting policy followed by petitioner and same came to be accepted. He would also submit that subsequently for the asst. yr. 2010-11 AO took a different view and has held that there was no concept of deferred revenue under the Act. By virtue of such change of view the assessment order for the asst. yr. 2009-10 is sought to be reopened by invoking s. 147 and issuing notice under s. 148 of the Act which is based purely on the changed opinion and change of opinion would not be a ground for reopening of the assessment. He would draw the attention of Court to s. 147 which has undergone change by Direct Tax Laws Amendment, 1989 w.e.f. 1st April, 1989 whereunder for the words "for reasons to be recorded by him in writing, is of the opinion'' came to be substituted by the words ''has reason to believe'' and as such change of opinion would not be a ground for reopening the assessment. In support of his submission he has relied upon the following judgments:

Commissioner of Income Tax, Delhi Vs. Kelvinator of India Limited,

Siemens Information System Ltd. Vs. The Assistant Commissioner of Income Tax 7(2), Commissioner of Income Tax-7 and Union of India (UOI),

Commissioner of Income Tax Vs. Punjab Tractors Co-op. Multipurpose Society Ltd.,

Unreported judgment of High Court of judicature, Bombay rendered in Writ Petn. No. 1327 of 2013 on 16th July, 2014-- Aroni Commercials Ltd. Vs. Assistant Commissioner of Income Tax,

T.T. Pvt. Ltd. Vs. Income Tax Officer, Company Circle-III, Bangalore,

He would also contend that in anticipation of the probable contention that Revenue may raise with regard to maintainability of writ petition namely petitioner ought to have approached the appellate authority and as such petitioner cannot question the issuance of notice issued under s. 148 in writ jurisdiction and to pre-empt such contention being raised or urged and in reply to the same he would submit this Court in exercise of power under Art. 226 has power to examine as to whether the notice issued is one without jurisdiction or not and for this proposition he has relied upon the judgment of Division Bench of this Court in the case of T.T. (P) Ltd. vs. ITO (supra) and contends that writ petition is maintainable and same cannot be dismissed on the ground of alternate remedy. Hence, he prays for allowing the writ petition and seeks for quashing of the impugned notice and prays for setting aside the reasons assigned by the respondent for sustaining the notice which is at Annex. P.

Per contra, Sri K.V. Aravind, learned counsel appearing for respondents would support the impugned notice issued to the petitioner and contends that the petitioner having adopted the policy of deferred revenue on the ground that it would be amenable to taxation only after warranty claim arises is not a procedure provided under the IT Act, 1961 or the issue of deferred revenue is not provided under the IT Act, 1961 and contends that petitioner-company having received the amounts by way of warranty from its customers and having not established as to when the said amounts received had been offered to tax, AO had reason to believe that it has escaped assessment and as such AO had called upon the petitioner to prove that such income in respect of which petitioner has declared in the return of income as deferred revenue having suffered tax with details thereof and contends that inspite of several particulars being given it was not furnished and as such AO had reason to believe that deferred payment had escaped assessment and for purposes of reassessment impugned notice has been issued.

He would also contend that the petitioner has not proved when notice came to be issued about the amounts which it sought for being treated as deferred revenue, of having been offered to tax at any subsequent stage or in the subsequent assessment years and in that view of the matter reassessment is proposed to be done and in the event of petitioner is able to establish, petitioner would be entitled for such allowances as is permissible under the Act. He would draw the attention of the Court to 2nd proviso to s. 147(1) of the Act to contend that it is incumbent upon the assessee to disclose fully and truly all material facts and during the assessment proceedings and despite calling upon petitioner by issuance of notice to furnish details of smart debits deferred revenue and same having not been furnished a sum of Rs. 124,88,69,986 was added to the income of assessee as could be seen from the assessment order dt. 25th March, 2014 Annex.-J and as such the AO had reason to believe that deferred revenue had escaped assessment and thereby he had issued the impugned notice for re-opening the assessment which does not suffer from any infirmity whatsoever and as such he prays for dismissal of the writ petition. In support of his submission he has relied upon the following judgments:

Assistant Commissioner of Income Tax Vs. Rajesh Jhaveri Stock Brokers Pvt. Ltd.,

Unreported judgment in the case of Jeans Knit P. Ltd. Vs. Deputy Commissioner of Income Tax,

Judgment of Division Bench of High Court of judicature at Madras in Writ Appeal Nos. 347-349 of 2014 and connected matters disposed of on 4th July, 2014--Jt. The Joint Commissioner of Income Tax Vs. Kalanithi Maran, .

Having heard the learned advocates appearing for the parties and on perusal of the records and case laws relied upon by learned advocates appearing for the parties, this Court is of the considered view that following points would arise for consideration:

"1. Whether impugned notice dt. 27th March, 2014 issued by 1st respondent under s. 148 of the IT Act, 1961 suffers from any jurisdictional error calling for exercise of extraordinary jurisdiction by this Court?

Whether reasons assigned by the 1st respondent vide communication dt. 25th April, 2014 Annex. M rejecting the objections raised by petitioner for reopening the assessment for the year 2009-10 can be held to satisfy the criteria prescribed under s. 147 of the Act?"

In order to delve upon the points formulated hereinabove it would be necessary to extract the relevant provisions which have bearing on the issue namely s. 147 and same is extracted herein below:

"147. If the AO has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of ss. 148 to 153 , assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned (hereafter in this section and in ss. 148 to 153 referred to as the relevant assessment year):

Provided that where an assessment under sub-s. (3) of s. 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under s. 139 or in response to a notice issued under sub-s. (1) of s. 142 or s. 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year:

Provided further that nothing contained in the first proviso shall apply in a case where any income in relation to any asset (including financial interest in any entity) located outside India, chargeable to tax, has escaped assessment for any assessment year:

Provided also that the AO may assess or reassess such income, other than the income involving matters which are the subject-matters of any appeal, reference or revision, which is chargeable to tax and has escaped assessment."

Perusal of above provision would indicate that prior to amendment s. 147 of the Act enabled the AO to re-open the assessment if he had formed an opinion about any income chargeable to tax had escaped assessment and reasons for such re-opening was required to be recorded by him in writing or in other words the opinion of AO was the basis on which it enabled him to reopen the assessment. However, post-amendment i.e., w.e.f. 1st April, 1989 the words ''for reasons to be recorded in writing, is of the opinion'', came to be substituted for the words ''has reason to believe''. In other words the AO had to base his reasons for such reopening of the assessment and mere change of opinion could not form the basis for reopening of such concluded assessment under s. 148 of the Act. A notice is required to be issued by the AO to reopen the assessment, if he has reason to believe that any income chargeable to tax had escaped assessment at the time of passing the assessment order. In other words there should be relevant material available before the AO upon which he reasonably or rationally can form the belief that any income chargeable to tax has escaped assessment. The formation of belief by the AO is essentially within his subjective satisfaction at the stage of issuing notice under s. 148 . The only question is whether there was sufficient material on which a man of reasonable prudence could have formed such belief or not. As to whether commencement of re-assessment proceedings is valid or not can be considered when questioned in a Court by examining it from the point of view of an AO namely as to whether there was prima facie ''reasonable belief entertained by the AO prior to issue of such notice or it is only because of change of opinion. Sufficiency of such material cannot be a ground which can be examined by the Court while examining a plea, attacking such notice issued under s. 148 r/w s. 147 . For this proposition judgment of Hon''ble apex Court in the case of Raymond Woollen Mills Ltd. Vs. Income Tax Officer and Others, can be looked up.

The AO at the stage of issuing notice is required to have ''reason to believe'' but not the established fact of escaping of income to tax. At the stage of issuing notice the only question is whether there was relevant material available before AO on which the AO would have formed such belief or in other words whether AO had reason to believe that income chargeable to tax had escaped assessment which confers upon him jurisdiction under s. 147 to reopen the assessment. Hon''ble apex Court in the case of CIT vs. Kelvinator of India Ltd. (supra) which has been very heavily relied upon by learned senior counsel appearing for petitioner has held that power to reopen or reassess post-1st April, 1989 is much wider than the pre-1989 amendment. It has been held that AO has power to reopen the concluded assessment provided there is ''tangible material'' before him to come to a conclusion that there is escaping of income chargeable to tax. It has also been held that the reasons have nexus or link to the formation of belief. It has been held by apex Court in said judgment to the following effect:

"6. On going through the changes, quoted above, made to s. 147 of the Act, we find that, prior to the Direct Tax Laws (Amendment) Act, 1987, reopening could be done under the above two conditions and fulfilment of the said conditions alone conferred jurisdiction on the AO to make a back assessment, but in s. 147 of the Act (w.e.f. 1st April, 1989), they are given a go-by and only one condition has remained, viz., that where the AO has reason to believe that income has escaped assessment, confers jurisdiction to reopen the assessment. Therefore, post-1st April, 1989, power to reopen is much wider. However, one needs to give a schematic interpretation to the words ''reason to believe'' failing which, we are afraid, s. 147 would give arbitrary powers to the AO to reopen assessments on the basis of mere change of opinion'', which cannot per se be reason to reopen".

Hon''ble apex Court in the case of Asstt. CIT vs. Rajesh Jhaveri Stock (supra) while examining the issue as to what constitutes an assessment order namely as to whether the quantum notice issued under s. 143(1)(a) would also be treated as an order passed under s. 143(3) has held in the negative and in this process, scope and effect of ss. 147 and 148 also came to be examined. While so examining it has been held by the apex Court that expression ''reason to believe'' cannot be read to mean that AO should have ascertained the fact by legal evidence or conclusion. It has been held by apex Court as under:

"16. Sec. 147 authorises and permits the AO to assess or reassess income chargeable to tax if he has reason to believe that income for any assessment year has escaped assessment. The word ''reason'' in the phrase ''reason to believe'' would mean cause or justification. If the AO ''has cause or justification to know or suppose that income had escaped assessment, it can be said to have reason to believe that an income had escaped assessment. The expression cannot be read to mean that the AO should have finally ascertained the fact by legal evidence or conclusion. The function of the AO is to administer the statute with solicitude for the Public Exchequer with an inbuilt idea of fairness to taxpayers. As observed by the Delhi High Court [sic] in Central Provinces Manganese Ore Co. Ltd. Vs. I.-T.O., Nagpur, , for initiation of action under s. 147(a) (as the provision stood at the relevant time) fulfilment of the two requisite conditions in that regard is essential. At that stage, the final outcome of the proceeding is not relevant. In other words, at the initiation stage, what is required is ''reason to believe'', but not the established fact of escapement of income. At the stage of issue of notice, the only question is whether there was relevant material on which a reasonable person could have formed a requisite belief. Whether the materials would conclusively prove the escapement is not the concern at that stage. This is so because the formation of belief by the AO is within the realm of subjective satisfaction [see INCOME TAX OFFICER Vs. SELECTED DALURBAND COAL CO. (P) LTD., Raymond Woollen Mills Ltd. Vs. Income Tax Officer and Others, ].

The scope and effect of s. 147 as substituted w.e.f. 1st April, 1989, as also ss. 148 to 152 are substantially different from the provisions as they stood prior to such substitution. Under the old provisions of s. 147 , separate cls. (a) and (b) laid down the circumstances under which income escaping assessment for the past assessment years could be assessed or reassessed. To confer jurisdiction under s. 147(a) two conditions were required to be satisfied firstly the AO must have reason to believe that income profits or gains chargeable to income-tax have escaped assessment, and secondly he must also have reason to believe that such escapement has occurred by reason of either (i) omission or failure on the part of the assessee to disclose fully or truly all material facts necessary for his assessment of that year. Both these conditions were conditions precedent to be satisfied before the AO could have jurisdiction to issue notice under s. 148 r/w s. 147(a) . But under the substituted s. 147 existence of only the first condition suffices. In other words if the AO for whatever reason has reason to believe that income has escaped assessment it confers jurisdiction to reopen the assessment. It is however to be noted that both the conditions must be fulfilled if the case falls within the ambit of the proviso to s. 147 . The case at hand is covered by the main provision and not the proviso.

So long as the ingredients of s. 147 are fulfilled, the AO is free to initiate proceeding under s. 147 and failure to take steps under s. 143(3) will not render the AO powerless to initiate reassessment proceedings even when intimation under s. 143(1) had been issued."

Keeping these principles in mind when the facts on hand are examined it would indicate that during the course of assessment proceedings for the asst. yr. 2009-10 assessee had requested the AO to reconcile the sales as per sales-tax return and sales declared in the return of income. Said returns on comparison was found by AO that sales as per sales register and sales tax return was Rs. 3185,47,04,713 and a sum of Rs. 81,26,94,037 was further added as service income not included in the VAT return. On this various adjustments were made to reach the net revenue of Rs. 3110,85,96,000. One of the reduction which was claimed was in a sum of Rs. 216,89,00,773 as smart debits deferred revenue account in the schedule of other liabilities as smart debits deferred revenue account. In the reasons furnished by 1st respondent for reopening the assessment vide reply dt. 25th April, 2014 Annex. M it has been noticed by the AO that deferred revenue in the reconciliation statement and the deferred revenue in the balance sheet other liabilities were more or less same. It was noticed by AO that petitioner-assessee in the schedule of other liabilities, had indicated further break-up of smart debits deferred revenue account was as under:

The AO noticed that deferred revenue in the reconciliation statement and deferred revenue in the balance sheet namely as reflected as ''other liabilities'' were more or less the same. The AO for the asst. yr. 2009-10 did not add such deferred revenue while computing the total income for the relevant assessment year as indicated in the assessment order for the reasons now assigned for reopening the assessment vide Annex. M namely that petitioner company may have admitted the sales in the subsequent assessment year.

As noticed earlier petitioner-company is engaged in the sales of computer hardware and related products by offering to its customers warranty services for different periods the details of which is not available before this Court and nor it was made available by the assessee before the AO.

Be that as it may. The warranty services in respect of which the assessee had claimed said amount to be treated as deferred revenue was on the basis that it would accrue as income of the petitioner-assessee only on such warranty being claimed by its customers over a period and it cannot be construed as income for next assessment year. Said reasoning was not required to be accepted by the AO at the stage of considering reply submitted by the assessee to the reopening notice for reasons more than one. Firstly details of such break up are not forthcoming. There might be situations where warranty expiring after one year, or even two years or three years which might have been offered by petitioner-assessee to its customers. Thus, it depends on factual aspects. It is because of this precise reason AO has called upon the assessee to furnish details thereof in order to ascertain as to whether said warranties in respect of which the assessee had claimed as deferred revenue had been factually offered in the subsequent year/s. Though Sri Perly Pardiwalla, learned senior counsel for petitioner was correct in contending that in respect of warranties which has been issued for two years would not arise immediately in the next financial year that by itself would not be a ground to reject the notice issued for reopening the assessment and it would be always open to the assessee to place all such material in support of its contention before the AO to establish as to when and how and in what mode such warranty which is claimed by it as deferred revenue would accrue as its income which has been treated as deferred revenue and same having been offered to tax in the subsequent year/s.

As already noticed hereinabove, the words used in s. 147 of the IT Act, 1961 empower the AO to issue notice for reopening the assessment, if he has "reason to believe" and it would not be in his domain at that stage to conclusively prove the escapement of such income to tax and if there is subjective satisfaction for issuance of notice for such reopening it would be fully within his domain to issue such notice. Hence, it would not be necessary for him to arrive at any conclusion at that stage particularly when there is no material whatsoever available before him to accept the contention of the assessee. As such, if AO has reason to believe income having escaped to tax it would give him the power to reopen the assessment and change of opinion would not.

In the instant case, the deferred revenue for the asst. yr. 2009-10 according to the AO ought to have been admitted or included by the assessee in the asst. yr. 2010-11 and on account of same having not been offered, has given rise for reopening of the assessment. Nothing prevented the petitioner to place such material to establish that such deferred revenue totaling Rs. 216,89,00,773 has been actually included as its income in the subsequent assessment years and if so, the details thereof with the break up, which the AO had called for at the first instance. In that view of the matter, it cannot be held that the reasons assigned by the AO by communication dt. 25th April, 2014 vide Annex. M for reopening the assessment for the year 2009-10 suffer from any jurisdictional error. Reply to notice issued under s. 148 of the Act which has been furnished by the petitioner-assessee to 1st respondent on 9th May, 2014 vide Annex. N has been examined by the AO to reject the said contention for the reasons indicated in the communication dt. 24th Feb., 2015 Annex. P. It has also been specifically made clear thereunder by 1st respondent that deferment of revenue has not been accepted even by the DRP and what has been stated in the said communication is that reply submitted by petitioner does not demonstrate or establish that total amount of Rs. 216,89,00,773 had been offered to tax in the asst. yr. 2010-11. The issue involved is the escapement of income to tax for the asst. yr. 2009-10. As such, the burden is on the assessee to demonstrate that said deferred revenue totaling to Rs. 216,89,00,773 has been offered to tax in the asst. yr. 2010-11 or in any subsequent years. In that view of the matter, I do not find any jurisdictional error having been committed by the AO to reopen the assessment for the asst. yr. 2009-10 by issue of impugned notice and also overruling of objections raised by the petitioner-assessee to such notice. For these myriad reasons, it has to be held that impugned notice dt. 27th March, 2014 (Annex.-K) and reasons assigned in the endorsement issued by 1st respondent to reopen the assessment for the asst. yr. 2009-10 dt. 24th Feb., 2015 (Annex.-P) does not suffer from any jurisdictional error or infirmity and said notice issued is in consonance with ss. 147 and 148 of the IT Act, 1961.

Though Sri K.V. Aravind has made an attempt to contend that this Court has no jurisdiction to entertain the writ petition on the ground of petitioner having alternate and efficacious remedy available under law, this Court is not inclined to accept the said contention inasmuch as in catena of judgments, this Court as well as the Hon''ble apex Court has held that exercise of extraordinary jurisdiction is available where the petitioner assails action of the authorities on the following grounds:

(i) without jurisdiction,

(ii) violation of principles of natural justice,

(iii) without authority of law,

(iv) validity or vires of the statutory provision being under challenge.

This view is also fortified by law laid down by apex Court in the case of Whirlpool Corporation Vs. Registrar of Trade Marks, Mumbai and Others, . In fact the Division Bench of this Court in the case of T.T. (P) Ltd. vs. ITO (supra) has held that availability of alternate remedy under the Act would not be a bar for this Court to examine the notice issued under s. 148 of the IT Act, 1961, if it is challenged on the ground of jurisdictional error. In that view of the matter, the contention raised by Sri K.V. Aravind cannot be accepted with regard to maintainability of the writ petition and same stands rejected.

It is made clear that no opinion is expressed on the merits of the claim and discussion made hereinabove is limited only for the purpose of examining the correctness or otherwise of the notice issued under s. 148 of the Act for reopening the assessment under s. 147 of the Act, and the reasons given by the AO to reject the reply submitted by the petitioner to the notice for reopening is just and correct.

For the reasons aforesaid, I proceed to pass the following:

(i) Writ petition is hereby dismissed.

(ii) No order as to costs.

Ordered accordingly.