If the assessing officer acts within his jurisdiction, the court will not interfere by a writ of prohibition. Nor will the court quash by a writ of certiorari an order of assessment made under Section 147 merely because it is erroneous on points of fact or law. The assessee's remedy in such cases is by way of appeal as provided by the Act.

However, if the Assessing Officer initiates proceedings under this Section without jurisdiction (CIT vs Raman - 67 ITR 11 - SC) or after the prescribed period of limitation has expired (ITO vs Murlidhar - 52 ITR 335 - SC), or proposes to make an assessment on a person other than the one on whom the notice is served, or in pursuance of a notice which isinvalid or not served in accordance with law, or without having reasonable grounds for believing that income had escaped assessment, or seeks to recover tax under assessment orders which were made without or in excess of jurisdiction (State of Assam vs Choudhuri - 76 ITR 706 - SC), or if the initiation of proceedings is not in good faith, or if the proposed proceedings would be merely an exercise in futility, -- a writ of prohibition or other appropriate writ would be issued by the court.

In such cases, the court is not deprived of its jurisdiction to grant appropriate relief merely because an assessment order is passed while the petition challenging the initiation of proceedings is still pending: The assessment order itself may be quashed by the court. In Calcutta Discount Co Ltd vs ITO - 41 ITR 191, 207-8), the Supreme Court issued an order under the Constitution quashing proceedings under Section 34(1) (a) of the 1922 Act as being without jurisdiction, since the assessee had disclosed all materialprimary facts at the time of the original assessment.

If in a petition challenging a proposed reassessment, the petitioner denies the existence of the conditions which confer jurisdiction and sets out facts which, unless disproved, would show that the assessing officer is incompetent to act under Section 147, the court should not, in the absence of other considerations, reject the petition in limine (MP Inds vs ITO - 57 ITR 637 - SC).

In Saradbhai M Lakhani vs ITO - 231 ITR 779), the Gujarat high court considered this point. The facts in this case were that the assessees were partners of a Firm B. The firm was dissolved on October 24, 1984, when a private limited company was incorporated specifically with the objective of purchasing the business of the firm. Before the firm was dissolved, it had undertaken work of the Daman Ganga project and completed the same on March 22, 1983.

On November 5, 1984, the business of the firm was transferred to the private limited company, except the right to receivepending claims in connection with the Daman Ganga project. The arbitrator, who went into the claim, passed an award for Rs 1,91,31,690 on November 6, 1986, in favour of the firm. The partners applied to the court for getting the amount directly. The payment was made on April 21, 1987, to the four partners of the erstwhile firm, each getting Rs 47,82,922. The partners showed the receipt of the amount in their returns of income and claimed exemption as capital receipt.

The deputy commissioner (assessment), special range, where the firm was assessed, passed an order, making addition of Rs 1,91,31,690 and intimated the share of income to the respective assessing officers, where the partners were assessed, to be assessed in the hands of the partners. Consequently, an order under Section 155 was passed on July 24, 1992, when the shares of award were assessed to tax after deduction of the firm's tax. The firm preferred an appeal before the commissioner of income-tax (appeals), who confirmed the addition. Aggrievedby the order, the firm went to appeal to the tribunal and the case is still pending. Meanwhile notice was issued to the partners under Section 148 of the Act. On a writ petition before the high court, the petitioner contended that the reasons for the income-tax officer's belief that income had escaped assessment was only a change of opinion and that could not be the basis for issuing a notice under Section 148 of the Act. However, the counsel representing the revenue stated that an authoritative judicial pronouncement could be information warranting the issue of the notice.

In the instant case, Bharat Vijay Construction Company, the partnership firm, was assessed for the year 1988-89. As much as Rs 1,43,25,205 was found to be divisible in the said assessment order passed under Section 143(3) of the Income-tax Act. Consequently, each sharer was found entitled to Rs 35,81,301. Aggrieved by that assessment order, the firm preferred an appeal before the appellate commissioner. When the firm failed before thatauthority, they took up the matter before the tribunal and the case is pending.

The high court held that the documents and assessment orders referred to earlier made it clear that the assessee placed the entire facts before the assessing authority. That authority took note of all the income accrued during the year 1988-89 and passed the orders of assessments. Thereafter, the impugned notices were issued. The short question was whether the issue of these notices was sustainable or not. Where the action of an executive authority is without jurisdiction and is likely to subject one to lengthy proceedings and unnecessary harassments, it is well-settled that the high courts are to issue appropriate orders to prevent such consequences (Calcutta Discount Company Ltd vs ITO - 41 ITR 191 - SC).

Before issuing notice under Section 148 of the Income-tax Act, the officer should have reason to believe. The said reason to believe cannot be reason to suspect. It is settled law that reason to believe can never be theoutcome of a change of opinion. It is essential that before any action is taken by the officer, the officer should substantiate his satisfaction. Reasons recorded in the instant case did not bring out any ground, making out an objective satisfaction arrived at by the officer. No reason other than those recorded by the officer therein could possibly be urged to sustain his action either. Since the entire facts relating to the income were made known to the assessing authority and no objective reason had been given for issuing a notice under Section 148, the court was constrained to quash the impugned notices issued to the applicants. It may also be mentioned that an appeal lies under Section 246 against a reassessment made under Section 147. The conditions requisite for reopening an assessment under clause (a) are much more stringent than those prescribed by clause (b) of this section. For instance, "information" which is enough to sustain an assessment under clause (b) may yet not point to such non-disclosureon the part of the assessee as is necessary to bring the case within clause (a).

What is not sufficient for the purpose of clause (a) may be sufficient for the purpose of clause (b); but the converse is not true. Therefore, an appellate authority cannot uphold under clause (a) an assessment made under clause (b) when the assessing officer has not applied his mind to the stricter requirements of clause (a) (Johrilal vs CIT - 88 ITR 439 - SC). However, it is open to an appellate authority to sustain an assessment wrongly made under clause (a) as one justified under clause (b), provided that on the materials on record the conditions required to be fulfilled under clause (b) are satisfied. In conclusion, it may be mentioned that courts are generally cautious before quashing a notice of reassessment in view of the fact that an appeal lies against the reassessment order under Section 246 of the Income-tax Act, 1961. Whenever alternative remedies are provided by law, courts prefer that such remedies be adopted.Writs are, therefore, admitted by courts only where the assessing officer has acted in gross violation of law or where he has no reasonable ground to believe that income has escaped assessment or where there is a possibility of miscarriage of justice.