Delhi High Court
Agricultural Produce Marketing ... vs Union Of India & Ors. on 13 February, 1995
Equivalent citations: (1996) 130 CTR Del 520
JUDGMENT
BY THE COURT :
This petition under Art. 226 of the Constitution of India is directed against the order of the Assessing Officer (AO) as well as the CIT(A) under the provisions of the IT Act, 1961 (in short, "the Act"), holding the petitioner not to be a "local authority" and thus exempt from payment of income-tax under s. 10(20) of the Act. The assessment proceedings in question are for the asst. yr. 1991-92. It appears, after the assessment order was made, attachment orders were issued against the petitioner for recovery of the tax demanded and its bank account was attached. While issuing notice to show cause the Court restrained the respondents from effecting any recovery from the petitioner and also stayed the operation of the notices of demand.
2. The assessment order was made on 31st March, 1994, by the AO. An appeal against this order was filed under the Act on 24th April, 1994. During the pendency of the appeal, it appears that the order of the AO was stayed. The appeal filed before the CIT(A) was dismissed on 2nd Dec., 1994. In normal circumstances, the second appeal could have been preferred to the Tribunal and when this fact was pointed out, Mr. Arun Jaitley, learned counsel for the petitioner, submitted that since the question of inherent jurisdiction is involved, the writ petition is also maintainable. He states that there are various judgments of the Supreme Court as well as of the High Court in support of the submission that a writ petition would lie and he says that in some cases, the judgments referred to committees like the petitioner. Mr. Jaitley referred to a judgment of the Supreme Court in Patel Premji Jiva vs. State of Gujarat (1971) 3 SCC 815, CIT vs. Agricultural Market Committee (1983) 143 ITR 1020 (AP) and Krishi Utpanna Bazar Samiti vs. ITO (1986) 158 ITR 742 (Bom).
3. On the other hand, Mr. Pandey, learned counsel for the Revenue, stated that since an efficacious alternative remedy was available, the petitioner should go to the Tribunal and should not invoke the extraordinary jurisdiction of this Court under Art. 226 of the Constitution of India. In support of his submission, Mr. Pandey referred to a decision of the Supreme Court in Titaghur Paper Mills Co. Ltd. vs. State of Orissa (1983) 142 ITR 663 (SC) and also to a decision of the Bombay High Court in Crompton Greaves Ltd. vs. A. K. Jain, IAC (1990) 185 ITR 513 (Bom) 489 and a Kerala High Court decision in Antonitto vs. TRO (1988) 171 ITR 461 (Ker). It is also submitted by Mr. Pandey that s. 10(29) of the Act has also to be considered. We may reproduce ss. 10(20) and 10(29) of the Act as under :
"Sec. 10(20). - The income of a local authority which is chargeable under the head Income from house property, Capital gains or Income from other sources or from a trade or business carried on by it which accrues or arises from the supply of a commodity or service (not being water or electricity) within its own jurisdictional area or from the supply of water or electricity within or outside its own jurisdictional area;
Sec. 10(29). - In the case of an authority constituted under any law for the time being in force for the marketing of commodities, any income derived from the letting of godowns or warehouses for storage, processing or facilitating the marketing of commodities."
4. The expression "local authority" has not been defined in the Act, though its definition under the General Clauses Act would be applicable. In any case, we are of the opinion that the question : "whether the petitioner would fall under s. 10(20) and/or s. 10(29) of the Act could be decided by the Tribunal under the Act. It is not a case where the petitioner has to come to this Court immediately when notice under the Act was issued. But it has already availed of the remedy of appeal in the first instance. In these circumstances, primarily keeping in view the decision of the Supreme Court in Titaghur Paper Mills case (supra). We would not like to interfere and would direct the petitioner to avail of its remedy under the Act and file an appeal before the Tribunal if it feels aggrieved by the order of the CIT(A). Mr. Pandey, learned counsel for the Revenue, submitted that for four months, the demand in question shall be kept in abeyance and the pay order received from the bank on account of attachment issued by the Revenue shall be returned to the petitioner. It was submitted that the pay orders had not been encashed in view of the interim order granted by this Court. This appears to be a fair offer.
5. Another question was also raised that the proceedings for the asst. yr. 1985-86 were also pending. For this year, Mr. Pandey states that the demands, if any, shall not be raised against the petitioner. Thus, we direct that while the assessment for the asst. yr. 1985-86 may go on, the demands, if any shall not be enforced, till the appeal in the present case is heard and decided by the Tribunal. Let the appeal before the Tribunal be filed immediately and we hope that in view of the importance of the question of law involved, the Tribunal would be able to dispose of the appeal expeditiously. With these observations, this petition stands disposed of.
