GENPACT INDIA PRIVATE LIMITED versus DEPUTY COMMISSIONER OF INCOME TAX & ANR.

Citation: [2019] 17 S.C.R. 139 · Decided: 22-11-2019 · Supreme Court of India · Bench: UDAY UMESH LALIT, INDIRA BANERJEE · Disposal: Dismissed

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Judgment (excerpt)

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GENPACT INDIA PRIVATE LIMITED
v.
DEPUTY COMMISSIONER OF INCOME TAX & ANR.
(Civil Appeal No. 8945 of 2019)
NOVEMBER 22, 2019
[UDAY UMESH LALIT AND INDIRA BANERJEE, JJ.]
Income Tax Act, 1961:
ss. 246(1)(a) and 246A(1)(a) – Scope of – Held: Scope of
the provisions cannot be confined to the issues arising out of or
touching upon assessment proceedings u/ss. 143 of 144 of Income
Tax Act – Determination u/s. 115QA of the Act would also get
covered under s. 246(1)(a).
s. 115QA – Assessment order – Liability u/s. 115QA – Denied
by assessee – Writ petition challenging assessment order – Petition
disposed of by High Court on the ground that the same could not
be entertained due to availability of alternate remedy u/s. 246-A
of the Act – Appeal to Supreme Court – Held: An appeal is
maintainable against determination of liability u/s. 115QA – Hence
petition u/Art. 226 of the Constitution was rightly not entertained.
Practice and Procedure :
Petition u/Art. 226 of the Constitution – Preliminary objection
as to its maintainability – Notice issued without rejecting
preliminary objection which was later made absolute – After
completion of pleadings, petition disposed of as not entertainable
on the ground of availability of alternative remedy – Plea that
preliminary issues are decided at the threshold and once that stage
is crossed, High Court could not have considered the preliminary
issue – Held: In the present case preliminary issue was not dealt
with and disposed of and the same was still at large – Therefore,
there is no infirmity in the approach adopted by the High Court in
deciding the preliminary issue.
Dismissing the appeal, the Court
HELD:1.1 The kinds of orders or situations that are
referred to in Section 246(1) (a) of the Income Tax Act, 1961
   [2019] 17 S.C.R. 139
139
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140
SUPREME COURT REPORTS
[2019] 17 S.C.R.
are:- (i) An order against the assessee, where the assessee
denies his liability to be assessed under this Act, or (ii) An
intimation under sub-section (1) or sub-section (1B) of Section
143 where the assessee objects to the making of adjustments,
or (iii) Any order of assessment under sub-section (3) of Section
143 or Section 144, where the assessee objects:- to the amount
of income assessed, or to the amount of tax determined, or to
the amount of loss computed, or to the status under which he is
assessed. The contingencies detailed in (ii) and (iii) hereinabove
arise out of assessment proceedings under Section 143 or
Section 144 of the Act but the first contingency is a standalone
postulate and is not dependant purely on the assessment
proceedings either under Section 143 or Section 144 of the Act.
The expression “denies his liability to be assessed” is quite
comprehensive to take within its fold every case where the
assessee denies his liability to be assessed under the Act. [Para
11] [157-H; 158-A-D]
Commissioner of Income Tax, U.P., Lucknow v. Kanpur
Coal Syndicate AIR (1965) SC 325 : [1964] SCR  85
– relied on.
1.2 Section 115QA of the Act stipulates that in case of buy
back of shares referred to in the provisions of said Section, the
company shall be liable to pay additional income tax at the rate
of 20% on the distributed income. Any determination in that
behalf, be it regarding quantification of the liability or the question
whether such company is liable or not would be matters coming
within the ambit of the first postulate referred to hereinabove.
Similar is the situation with respect to provisions of Section
246A(1)(a) where again out of certain situations contemplated,
one of them is “an order against the assessee, where the
assessee denies his liability to be assessed under this Act”. The
computation and extent of liability is determined under the
provisions of Section 115QA of the Act. Such determination
under the Act would squarely get covered under said expression.
There is no reason why the scope of the such expression be
restricted and confined to issues arising out of or touching upon
assessment proceedings either under Section 143 or Section 144
of the Act.  [Para 12] [158-E-G]
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1.3 If the expression in Section 246(1)(a) or in Section
246A(1)(a) is considered as relatable to the liability of an
assessee to be assessed under Section 143(3) there would be
no appellate remedy in case of any determination under Section
115QA. The issues may arise not just confined to the question
whether the company is liable at all but may also relate to oth

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