Law: Income Tax Act, 1961

Section: 139

Section 139 of the Income-tax Act, 1961 [Corresponding to section 22(2) of the Indian Income-tax Act, 1922] - Return of income - General - Assessment year 1958-59 FACTS The petitioner was served under section 22(2) of 1922 Act for filing of returns. The petitioner did not file return on ground that income from property held under trust was not liable to tax being exempt under section 4(3)(i) of 1922 Act. The petitioner was once again called upon to file returns falling which respondent threatened to proceed ex parte against it. The petitioner filed instant writ to quash the impugned notice. HELD The pith of the matter is that relief can always be granted and indeed should be granted by means of a prerogative writ in cases of threat by State to realise without authority of law tax from a citizen by using coercive machinery, but generally speaking there should be a clear-cut case of lack of jurisdiction or of a gross violation of mandatory provisions of law and the interests of justice should call for interference. Merely because it is alleged that ultimately assessment is likely to be contrary to law, this court would be disinclined on such allegation alone to by-pass the usual machinery provided by the legislature and to proceed itself to investigate into the merits of the controversy. In view of the position just stated it was difficult to say as a matter of law that the present writ petition was incompetent and should not, therefore, be entertained and must be thrown out without hearing the petitioner. It is obvious that even in the case of section 4(3)(i) of 1922 Act application of the income to such religious or charitable purposes or accumulation of such income for application to such purposes is essential for claiming exemption. In instant case, no good and cogent ground had been made out for by-passing the normal procedure prescribed by the Indian Income-tax Act and for inducing this court to hold an inquiry in proceedings for a prerogative writ under article 226 of the Constitution. It was apparent that the respondent would decide the validity of the objections claiming exemption from assessment after the whole relevant material was placed before him…

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