[Cites 9, Cited by 0]
Delhi High Court
M/S Supreme Build-Cap Pvt. Ltd vs Assistant Commissioner Of Income Tax, ... on 8 April, 2026
$~74
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision : 08.04.2026
+ W.P.(C) 4543/2026 CM APPL. 22167/2026 CM APPL. 22168/2026
M/S SUPREME BUILD-CAP PVT. LTD. .....Petitioner
Through: Mr. Rohit Tiwari, Ms. Kanika Jain
and Mr. Saurabh D. Karan Singh,
Advs.
versus
ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL
CIRCLE (5), DELHI .....Respondent
Through: Mr. Ruchir Bhatia SSC with Mr.
Anant Mann and Mr. Pratyaksh
Gupta, JSCs.
CORAM:
HON'BLE MR. JUSTICE DINESH MEHTA
HON'BLE MR. JUSTICE VINOD KUMAR
DINESH MEHTA, J. (ORAL)
1. By way of the present writ petition, the petitioner has challenged the
assessment order dated 29.03.2026 on various grounds including the basic
ground that the initiation of reassessment proceedings by way of the notice
dated 30.08.2024 issued under Section 148 of the Income Tax Act, 1961
(hereinafter referred to as 'the Act of 1961') for Assessment Year (AY)
2016-17 was time barred, as the limitation for issuing a notice under Section
148 of the Act of 1961 at the relevant time was only six years.
2. Mr. Ruchir Bhaita, learned Senior Standing Counsel for the
respondent-Department at the outset raised an objection regarding
maintainability and submitted that the petitioner has come to this Court
against an assessment order and since there is a statutory remedy available,
this Court should not entertain the writ petition and relegate it to avail the
statutory remedy.
3. Learned counsel for the petitioner-assessee immediately responded to
the preliminary objection raised by Mr. Ruchir Bhatia by submitting that
during the assessment proceedings, in response to the show cause notice
dated 21.03.2026, the petitioner did file a reply and raised a plea of the
notice being time barred but the same was not even considered by the
Assessing Officer (AO).
4. He further submitted that petitioner's basic challenge to the impugned
assessment order is, that the proceedings are time barred in light of judgment
of this Court dated 23.07.2024 titled as Manju Somani v. Income Tax
Officer, Ward-70(1) & Ors. in W.P.(C) 7364/2024, 2024:DHC:5411-DB
and since the issue as canvassed goes to the root of the matter, this Court can
well exercise its jurisdiction under Article 226 of the Constitution of India in
light of the series of judgments passed by Hon'ble the Supreme Court and
by this Court.
5. He argued that a simple look at the impugned notice dated 30.08.2024
shows that it is per-se beyond prescribed period of limitation and if that
impugned notice is declared void and illegal for being beyond limitation, the
assessment order shall definitely fall flat on the ground.
6. In response to the petitioner's submission, Mr. Ruchir Bhatia, learned
Senior Standing Counsel could not give any satisfactory explanation. He
however, submitted that if the petitioner was so aggrieved by the initiation
of proceedings, it ought to have approached this Court before an assessment
order was passed.
7. Having heard learned counsel for the parties, we are of the view that
the initiation of reassessment proceedings vide notice dated 30.08.2024 is
fundamentally void being beyond the prescribed period of limitation.
Though the petitioner has approached this Court after suffering an
assessment order, however given the fact that the petitioner had raised
jurisdictional objection before the AO in its reply and the same remained
unheeded and undecided, we are of the view that simply because the
proceedings have culminated into an assessment order, the petitioner cannot
be made to suffer the agony of an order which is without jurisdiction on the
face of it, until the appellate authority does a formal act of annulling it.
8. Requiring the petitioner to take up the formality rather rigmarole of
the appellate proceedings when the facts are crystal clear, would be
iniquitous in the present factual matrix. We are, therefore, persuaded to
allow the present writ petition in light of judgment of Hon'ble the Supreme
Court rendered in the case of M/s Magadh Sugar Mills and Energy
Limited vs. The State of Bihar And Others, reported in 2021 SCC
OnLine SC 801, wherein Hon'ble the Supreme Court reiterated the
principles governing the exercise of writ jurisdiction where an alternate
remedy exists. The relevant paragraph of the said judgment is reproduced
hereinfra:
"19 While a High Court would normally not exercise its writ
jurisdiction under Article 226 of the Constitution if an effective
and efficacious alternate remedy is available, the existence of an
alternate remedy does not by itself bar the High Court from
exercising its jurisdiction in certain contingencies. This principle
has been crystallized by this Court in Whirpool Corporation v.
Registrar of Trademarks, Mumbai and Harbanslal Sahni v.
Indian Oil Corporation Ltd. Recently, in Radha Krishan
Industries v. State of Himachal Pradesh & Ors a two judge
Bench of this Court of which one of us was a part of (Justice DY
Chandrachud) has summarized the principles governing the
exercise of writ jurisdiction by the High Court in the presence of
an alternate remedy. This Court has observed:
"28. The principles of law which emerge are that:
(i) The power under Article 226 of the Constitution to
issue writs can be exercised not only for the
enforcement of fundamental rights, but for any other
purpose as well; (ii) The High Court has the
discretion not to entertain a writ petition. One of the
restrictions placed on the power of the High Court is
where an effective alternate remedy is available to the
aggrieved person;
(iii) Exceptions to the rule of alternate remedy arise
where (a) the writ petition has been filed for the
enforcement of a fundamental right protected by Part
III of the Constitution; (b) there has been a violation
of the principles of natural justice; (c) the order or
proceedings are wholly without jurisdiction; or (d)
the vires of a legislation is challenged; (iv) An
alternate remedy by itself does not divest the High
Court of its powers under Article 226 of the
Constitution in an appropriate case though
ordinarily, a writ petition should not be entertained
when an efficacious alternate remedy is provided by
law;
(v) When a right is created by a statute, which itself
prescribes the remedy or procedure for enforcing the
right or liability, resort must be had to that particular
statutory remedy before invoking the discretionary
remedy under Article 226 of the Constitution. This
rule of exhaustion of statutory remedies is a rule of
policy, convenience and discretion; and
(vi) In cases where there are disputed questions of
fact, the High Court may decide to decline
jurisdiction in a writ petition. However, if the High
Court is objectively of the view that the nature of the
controversy requires the exercise of its writ
jurisdiction, such a view would not readily be
interfered with.
......"
(emphasis supplied)
9. This view was further affirmed by Hon'ble the Supreme Court in the
case of Executive Engineer v. Seetaram Rice Mill, reported in (2012) 2
SCC 108 wherein, a show cause notice and provisional assessment were
issued alleging unauthorized use of electricity under Section 126 of the
Electricity Act, 2003, followed by a demand. The assessee questioned the
applicability of the provision itself and consequently the jurisdiction of the
authority to proceed. The High Court entertained the writ petition, and
Hon'ble the Supreme Court, it being a case involving a challenge to the
authority's jurisdiction, upheld such exercise of jurisdiction while observing
thus:
82. It is argued and to some extent correctly that the High Court
should not decline to exercise its jurisdiction merely for the
reason that there is a statutory alternative remedy available even
when the case falls in the abovestated class of cases. It is a
settled principle that the courts/tribunal will not exercise
jurisdiction in futility. The law will not itself attempt to do an act
which would be vain, lex nil frustra facit, nor to enforce one
which would be frivolous--lex neminem cogit ad vana seu
inutilia--the law will not force anyone to do a thing vain and
fruitless. In other words, if exercise of jurisdiction by the
tribunal ex facie appears to be an exercise of jurisdiction in
futility for any of the stated reasons, then it will be permissible
for the High Court to interfere in exercise of its jurisdiction. This
issue is no longer res integra and has been settled by a catena of
judgments of this Court, which we find entirely unnecessary to
refer to in detail. Suffice it to make a reference to the judgment
of this Court in Whirlpool Corpn. v. Registrar of Trade Marks
[(1998) 8 SCC 1] where this Court was concerned with the
powers of the Registrar of Trade Marks and the Tribunal under
the Trade and Merchandise Marks Act, 1958 and exercise of
jurisdiction by the High Court in the face of availability of a
remedy under the Act.
10. In view of the discussion foregoing, the impugned notice dated
30.08.2024 issued under Section 148 of the Act of 1961 so also the
consequential assessment order dated 29.03.2026 is hereby quashed.
11. The writ petition stands allowed accordingly.
12. The pending applications stand dismissed.
DINESH MEHTA, J
VINOD KUMAR, J
APRIL 08, 2026/dd
