- (1.) These writ petitions have been filed challenging the show cause notices, F.No.CIT(A)/RAN/Notice/2012-13/374-75 dated 8/10.1.2013 and F.No. CIT(A)/RAN/Notice/2012-13 dated 24.1.2013 issued under section 251(1)(a) of the I.T Act, 1961, by which the Commissioner of Income Tax (Appeals) directed the petitioner-company to show cause as to why the provisions of section 251(1)(a) of the I.T Act should not be invoked for the Assessment Years 2002-03, 2003-04, 2004-05, 2005-06, 2006-07, 2007-08, 2008-09, 2009-10 and the income liable to tax should not be enhanced and why the books of accounts of the petitioner-company should not be rejected and also directed the petitioner-company to show the status of the petitioner as a company.
(2.) On behalf of the writ petitioner, it is contended that Central Coalfields Limited (CCL) is a public sector undertaking and registered as a company in the year 1956. In view of sub-section (17) and (26) of Section 2 of the I.T Act, 1961, the Income Tax Department had rightly assessed the status of the petitioner as a "Company". The petitioner, right from its inception till date, i.e. 1956-57 to 2010-11, had filed its returns and had been assessed to income. The books of accounts are subject to various audits including the statutory audit, C.A.G audit etc.
(3.) In the case of Union of India & Ors. Vs. Ramesh Gandhi in Criminal Appeal No.1356/2004, Hon'ble Supreme Court, holding that there was no direction or order by the Calcutta High Court fixing the price of the coal sold by M/s. CCL to various concerns, set aside the order of the Calcutta High Court and restored the FIR lodged by the CBI for causing wrongful loss to the assessee. Referring to the order of the Hon'ble Supreme Court restoring the FIR lodged by the CBI, the CIT (Appeals) issued the impugned show cause notices dated 8/10.1.2013 for the assessment years 2002-03, 2003-04, 2004-05, 2005-06, 2006-07, 2007-08, 2008-09, 2009-10, directing the petitioner-company to show cause as to why the provisions of Section 251(1)(1)(a) of the I.T Act should not be invoked and the income liable to tax should not be enhanced and why the books of accounts of the petitioner-company be not rejected. The impugned show cause notice reads as under:- "Hon'ble Supreme Court has set-aside the order of Hon'ble Calcutta High Court and restored the FIR by the CBI for causing wrongful losses to the assessee. In view of that the Balance Sheet and P&L A/C as prepared by the assessee did not correctly reflect the affairs of the assessee. The same was because of the incorrect books of accounts maintained by the assessee and the failure and inability of the assessee and its management to maintain its books of accounts correctly and appropriately. Because of such failure of assessee and its management during the period covered by the CBI FIR,the accounts of the assessee are incorrect and erroneous and are therefore unreliable. The Books of Accounts of the assessee for the years for which appeals are pending before this office are based upon and are the continuation of the incorrect and erroneous Books of Accounts of earlier period and because of that is also incorrect and erroneous and cannot be relied upon as a basis to determine and compute the true and correct income of the assessee. In view of that the same are liable to be rejected and the correct income of appellant is required to be determined as per applicable provisions of law.";