Shandilya Properties LLP Vs ITO (Bombay High Court)
Bombay High Court dismissed the writ petition filed by Shandilya Properties LLP, challenging an assessment order issued under Section 143(3) read with Section 144B of the Income Tax Act, 1961. The court ruled that the petitioner must first exhaust the alternate remedy of appeal before the Commissioner (Appeals) rather than directly approaching the High Court under Article 226 of the Constitution. The petition sought to quash the assessment order and demand notice, contending that the tax was imposed on income already assessed and taxed in the previous year.
The petitioner, represented by Senior Advocate Mr. Mistri, argued that the assessment order was without jurisdiction, contrary to established legal principles, and in defiance of binding judicial precedents, including CIT v. Aditya Builders, CIT v. Bilahari Investment (P.) Ltd., and PCIT v. Quest Investment Advisors Pvt. Ltd.. He contended that the company had consistently followed the Project Completion Method of Accounting, which had been previously accepted in assessments for multiple years. The reassessment under the Percentage of Completion Method was therefore arbitrary. However, the court held that factual disputes regarding the method of accounting should be addressed through the statutory appellate process rather than judicial review.
