Case Law Details
Lakshman Prasad Garwal Vs Union of India And Ors (Calcutta High Court)
Introduction: In a significant legal development, the Calcutta High Court recently addressed a writ petition filed by Lakshman Prasad Garwal, challenging the reassessment order issued by the Income Tax Authority under Section 147 of the Income Tax Act, 1961, for the assessment year 2017-18. The crux of the petitioner’s argument revolved around the alleged violation of principles of natural justice due to the denial of his right to cross-examine a key witness named Rajal Ashar, whose statement had been pivotal in the issuance of the impugned assessment order.
Detailed Analysis: The petitioner contended that the Income Tax Authority had based its reassessment order on the statement provided by Rajal Ashar. However, the petitioner was not afforded the opportunity to cross-examine this witness, which he asserted was his fundamental right in accordance with the principles of natural justice.
The respondent, represented by Ms. Das De, argued that the impugned order under Section 147 of the Income Tax Act was appealable. She suggested that the writ petition should not be entertained on the grounds of an alternative remedy being available to the petitioner. Nevertheless, Ms. Das De failed to provide evidence from the records indicating that the petitioner had been granted the opportunity to cross-examine the aforementioned witness.
The Court took into consideration the distinction between cases under the Old unamended Act, such as the present one, and those governed by the newly amended Act concerning assessment orders under Section 147 and 148A. It emphasized that under the Old Act, there was no provision for requesting cross-examination. The contention that the witness resided beyond 500 kilometers from the respondent’s office was also addressed. The Court considered this argument as outdated, highlighting the availability of modern electronic tools like computers and the internet, which have global accessibility.
After a comprehensive examination of the case’s facts and circumstances, the Court made its decision. The writ petition, numbered WPO 1552 of 2023, was disposed of by setting aside the impugned assessment order under Section 147 of the Income Tax Act. The matter was remanded to the assessing officer responsible for issuing a fresh order. This fresh order would include granting the petitioner the opportunity to cross-examine the aforementioned witness. Importantly, the Court clarified that the impugned order’s annulment was solely due to the violation of natural justice principles concerning the denial of the petitioner’s right to cross-examine the witness and did not concern the merits of the assessment order.
Conclusion: The Calcutta High Court’s decision in the case of Lakshman Prasad Garwal v. Union of India And Ors sets a significant precedent by upholding the principles of natural justice. It underscores the importance of providing individuals with the opportunity to cross-examine witnesses whose statements are pivotal in decisions that may affect their interests. The Court’s ruling serves as a reminder of the enduring significance of these fundamental principles in the field of taxation and administrative law.
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT
By this writ petition, petitioner has challenged the impugned orders under Section 147(under the Old unamended Act) of the Income Tax Act, 1961 relating to assessment year 2017-18 on the ground of violation of principles of natural justice by denying the petitioner his right to cross-examine one witness named Rajal Ashar on whose statement the respondent Income Tax Authority has relied in passing the impugned assessment order. It appears that in compliance of the order of the Division Bench of this Court in petitioner’s own case though respondent Authority have furnished the complete documents which petitioner has asked for, before passing the impugned assessment order and from which petitioner came to know that the respondent has relied on the aforesaid witness and whose statement is adverse to the interest of the petitioner but he has not been allowed to cross-examine and as basic principles of natural justice, petitioner is entitled to cross-examine the said witness.
Ms. Das De, learned advocate appearing for the respondent Income Tax Authority submits that since the impugned order under Section 147 of the Act has already been passed and which is an appealable order, as such on the ground of availability of alternative remedy, this writ petition should not be entertained but she failed to satisfy this Court from record that petitioner was granted opportunity to cross-examine the aforesaid witness upon whose statement petitioner has relied. It is not a case under the newly amended Act relating to assessment order under Section 147 and 148A where petitioner after the order under Section 148A(d) of the Act had the scope in asking for cross-examination. Under the Old Act, there is no such scope. Contention of Ms. Das De that right to cross-examine the aforesaid witness cannot be considered in this case since the said witness resides beyond 500 kilometer from the respondents’ office which is something absurd in this modern electronics age when computer and internet facilities are available globally.
Considering the facts and circumstances of the case and in view of the discussion made above, this writ petition being WPO 1552 of 2023 is disposed of by setting aside the aforesaid impugned assessment order under Section 147 of the Act and the matter is remanded back to the assessing officer concerned to pass a fresh order after providing the petitioner opportunity to cross-examine the aforesaid witness.
It is clarified that the aforesaid impugned order has been set aside only on the ground of violation of principles of natural justice by denying the petitioner his right to cross-examine the aforesaid witness and not on other merits of the assessment order.
