Existence of Statutory Alternative Remedy Precludes Writ Jurisdiction Against Income Tax Assessment Orders

The appellant, a cooperative wholesale stores society, was subjected to an assessment order passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961.

It challenged the said order before the learned Single Judge in W.P.(MD) No. 11172 of 2025. By order dated 06.10.2025, the Single Judge held that the assessment order was appealable and directed the writ petitioner to approach the Appellate Authority.

The Single Judge further granted the petitioner four weeks' time to file the statutory appeal and directed that such appeal shall not be rejected on the ground of limitation.

Additionally, the Single Judge directed that the impugned assessment order be kept in abeyance for a period of three months from the date of the order.

Aggrieved by this order relegating it to the appellate remedy, the writ petitioner preferred the present intra-court writ appeal under Clause 15 of the Letters Patent.

1. Whether the order of the learned Single Judge declining to entertain the writ petition against an assessment order passed under Section 143(3) r/w Section 144B of the Income Tax Act, and relegating the petitioner to the statutory appellate remedy, warranted interference in a writ appeal.

2. Whether the High Court, in exercise of writ jurisdiction, could adjudicate the merits of the assessment and thereby substitute itself for the statutory Appellate Authority.

The Court applied the well-settled doctrine of exhaustion of alternative remedies, under which writ jurisdiction is ordinarily not exercised where the statute provides an efficacious appellate mechanism; an assessment order under Section 143(3) r/w Section 144B of the Income Tax Act, 1961 is appealable under the Act.

The Court further applied the principle of institutional restraint — that the writ court "cannot substitute itself for the Appellate Authority" — all factual and legal contentions concerning an assessment are matters for the statutory appellate forum.

The Division Bench noted that the learned Single Judge had not merely relegated the petitioner to the appellate remedy but had done so on terms "extremely gracious" and "extremely liberal" to the petitioner: extension of time to file the appeal, a protective direction that the appeal not be rejected on limitation, and a three-month abeyance of the impugned assessment order, from which the petitioner "has, in fact, benefited".

Applying the alternative remedy doctrine to these facts, the Court held that every contention raised or intended to be raised by the petitioner "can very well be raised before the Appellate Authority," and consequently no exceptional circumstance existed to justify bypassing the statutory channel.

As the Single Judge's directions were protective rather than prejudicial, the Bench found "no reason to interfere" with the order under challenge.

The writ appeal was dismissed, affirming the order dated 06.10.2025 of the learned Single Judge in W.P.(MD) No. 11172 of 2025. The appellant retains the benefits granted by the Single Judge — the extended period to file the appeal, immunity from rejection on limitation, and the three-month abeyance of the assessment order. No costs.