Paradise Food Court Private Limited Vs DCIT (Supreme Court of India)
Summary: Paradise Food Court Private Limited challenged an intimation dated 11.11.2019 issued under Section 143(1) of the Income Tax Act, 1961 for assessment year 2018-19. Before the High Court, the petitioner contended that the Department had already initiated scrutiny by notice dated 23.09.2019 under Section 143(2), to which it responded on 08.10.2019, and that an order under Section 143(3) was ultimately passed on 31.03.2021 accepting the returns. According to the petitioner, once regular scrutiny proceedings commenced, the Section 143(1) proceedings merged with or could not independently continue, and the subsequent intimation was without jurisdiction. It relied, inter alia, upon Vodafone Idea Limited (earlier known as Vodafone Mobile Services Limited) vs. Assistant Commissioner of Income Tax, Circle 26(2) and Another and Tamil Nadu Magnesite Ltd. vs. The Commissioner of Income-Tax and Another. The Income Tax Department opposed the writ petition principally on delay and availability of an alternative statutory remedy. It pointed out that although the intimation was dated 11.11.2019, the writ petition was filed only on 29.01.2026; further, the petitioner had filed an appeal before the CIT (Appeals) only on 25.09.2024, which was dismissed on 24.09.2025 because the delay exceeded 1751 days, while a further appeal to the ITAT remained available under Section 253. The High Court accepted the maintainability objections. It observed that writ jurisdiction under Article 226 is ordinarily not exercised routinely where a statutory remedy exists, while recognising exceptional situations involving fundamental rights, natural justice or jurisdiction. It distinguished Harbanslal Sahnia vs. Indian Oil Corporation Ltd. on the facts, noting both the considerable delay and the petitioner’s decision to avail the first appellate remedy while bypassing the second appeal. Without entering into the merits of the controversy concerning Sections 143(1), 143(2) and 143(3), the High Court dismissed the writ petition while reserving the petitioner’s right to appeal under Section 253 before the ITAT. The petitioner then approached the Supreme Court by Special Leave Petition. After hearing counsel, the Supreme Court declined to entertain the SLP and dismissed it. Significantly, however, the Court expressly observed that if the petitioner avails the alternate remedy and files an application before the ITAT seeking condonation of delay, that application must be examined and decided on its own merits, without being influenced by any observations in the High Court’s impugned order. Thus, the Supreme Court did not adjudicate the underlying Section 143(1) jurisdiction/merger controversy; its operative order left the petitioner free to pursue the statutory appellate remedy and required any delay-condonation application to receive an independent merits-based consideration.
Cases Discussed
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- Vodafone Idea Limited (earlier known as Vodafone Mobile Services Limited) vs. Assistant Commissioner of Income Tax, Circle 26(2) and Another, (2020) 19 Supreme Court Cases 12 (Supreme Court) — relied upon by the petitioner in support of its challenge to continuation of proceedings under Section 143(1) after commencement of regular assessment proceedings.
- Tamil Nadu Magnesite Ltd. vs. The Commissioner of Income-Tax and Another, 2010 SCC OnLine Mad 4450 (Madras High Court) — relied upon by the petitioner concerning the effect of regular assessment proceedings upon an intimation under Section 143(1).
- Harbanslal Sahnia vs. Indian Oil Corporation Ltd., (2003) 2 SCC 107 (Supreme Court) — relied upon by the petitioner concerning exercise of writ jurisdiction despite an alternative remedy; distinguished by the High Court because the writ petition was considerably delayed and the petitioner had already availed the first appellate remedy while bypassing the second appeal.
FULL TEXT OF THE ORDER OF SUPREME COURT OF INDIA
1. Having heard the learned counsel appearing for the petitioner, we are not inclined to entertain this Special Leave Petition. Hence, Special Leave Petition is, hereby, dismissed.
2. However, it is needless to observe that in the event of alternate remedy being availed and an application for condonation for delay being filed before the Income Tax Appellate Tribunal, the same shall be examined and decided on its own merits, without being influenced by any of the observations made under the impugned order.
3. Pending application(s), if any, shall stand disposed of.
