Where a statutory forum is created for the resolution of grievances, the Petition in Brief cannot be accepted: J&K&L High Court

The High Court of Jammu and Kashmir and Ladakh ruled that where a statutory forum is created by law for the redress of grievances, a petition for writ cannot be granted ignoring statutory dispensation.

In this context, the Bench of Judge Mohd. Akram Chowdhary and Judge Ali Mohammad Magrey observed that “…the (Black Money (Undisclosed Foreign Income and Assets) Act 2015 and Taxation Act 2015) provides a comprehensive mechanism for the person aggrieved from any action taken by the Valuation Officer and such person shall not be entitled to abandon that mechanism and invoke the jurisdiction of the High Court under Section 226 of the Constitution then that she had an adequate remedy available to him by way of appeal to the Appeals Commissioner.”.

The Court noted that the person being assessed may lose a remedy of having the case reviewed on the factual aspects of the case and also be deprived of the due avenues of challenge available to them under the hierarchy of forums available under the regime of law.

The Court made this observation when dealing with a batch of court applications attacking the validity of opinions issued by the defendant’s assessment authority under section 10(1) of the black money (undisclosed foreign income and assets) and on the imposition of tax. as well as show cause notices.

The applicants had also challenged the penalty notices, assessment orders and formal notices issued by the respondent assessment authority.

In the three written petitions filed with the Court, the petitioners, namely, Tabasum Mir and Amir Mir argued that they were beneficiaries of a Trust created and established abroad. Claimant Abdul Rashid Mir & Ors., argued that their predecessor in interest, Sabeha Mir, is a beneficiary of the said trust.

These petitioners have brought profits/money from them into the country with the permission granted by the Reserve Bank of India.

In the meantime, the Black Money (Undisclosed Foreign Income and Assets) and Taxation Act 2015 (Act 2015) has been enforced. In view of the said Act, a notice under Article 10(1) and subsequently under Article 10(2) was issued requiring certain information from the applicants and the predecessor in the interest of the applicants.

The said notice has been duly responded to by the petitioner, but to date, no assessment order as contemplated under section 10 has been issued against the petitioner.

At the same time, another show cause notice dated March 18, 2021 was issued requiring them to show cause why, with respect to some of the assets, they should not be taxed under the law and penalties and prosecutions should be brought against them.

It is established that the aforementioned show cause notice is neither a notice issued under section 10 nor a notice under any other provision of the Act and, as such, is without jurisdiction.

When these petitions came before the High Court, the Court had ordered the assessment authority to proceed and issue an assessment order in accordance with the show cause notices. However, the Court had ordered the authority not to prosecute and to impose a sentence on the petitioners based on the disputed show cause notice.

However, the assessment authority went ahead and passed the assessment order along with the penalty notice to the petitioners.

Feeling aggrieved, the petitioners went to the High Court.

Senior Attorney P. Chidambaram appeared for the petitioners while Tahir Majid ShamsiDSGI with Lawyer Nazima Yaqoob appeared for the Union of India and Lawyer Areeb J. Kawoosa appeared on behalf of the other respondents.

Counsel for the defendants had argued that the motions in writ were not admissible before the Court on the ground that the petitioners had the statutory remedy of appeal to the Commissioner (Appeals) under section 15 of the 2015 Act .

The Court noted that Section 15(1)(b) and (c) of the 2015 Act clearly states that any person denying liability to be assessed under the 2015 Act or objecting to any sanction imposed by the Assessing Officer may appeal to the Appeals Commissioner.

The Court observed that “In the present case, it is true that the claimants deny their liability to assess under the 2015 Act with reference to the foreign asset which they acquired from non-taxable income in India. The claimants, in their pleadings before this Court, not only asserted that they were not taxable under the 2015 Act, but they also questioned the various factual aspects of the matter in that they calculated income and l tax to be paid by the liquidating agent.

The Court noted that while these petitioners’ submissions are accepted by the Court in the exercise of powers under Section 226 of the Constitution, whenever factual/dispute aspects will need to be addressed in proceedings such as a motion filed under Section 226 of the Constitution which would normally not be successful on questions of fact.

“All of the petitioners’ arguments, as raised in these petitions, including the issue of jurisdiction, applicability or otherwise of law, can most conveniently be dealt with by the appellate authority pursuant to the terms of reference of Sections 15 and 17 of the law. of 2015.”, the Court upheld.

Accordingly, the Court declared the Petitions in Brief as inadmissible in view of the statutory remedy of appeal available to Petitioners under the mandate of Sections 15 and 17 of the 2015 Act.

However, the Court granted the Applicants freedom to avail themselves of the aforementioned legal remedy of appeal against the proceedings brought against them within a period of one month.

The Court ordered the appellate authority to consider the same on the merits without making any reference to the statute of limitations and, ordered that until then, no punitive action be taken against the petitioners if such appeal is filed within the time allowed by the Court.

Title of the case – Tabasum Mir v. Union of India & Ors. with related topics

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Melvin B. Baillie