TMI Blog2008 (6) TMI 236X X X X Extracts X X X X X X X X Extracts X X X X ..... uld not have issued further notice u/s. 148 of the Act. Accordingly, the assessment framed on the basis of notice issued without jurisdiction is bad in law and does not have legs to stand. The ld DR also contended that the defect in the notice can be ignored u/s. 292B of the Act. Sec. 292B of the IT Act, 1961 says that no return of income, assessment, notice, summons or other proceedings, etc. shall be invalid, or shall be deemed to be invalid merely by reason of any mistake or defect or omission in such return of income, assessment, notice, summons or other proceedings, if such return of income, assessment, notice, summons or other proceedings is in substance and effect in conformity with or in according to the intent and purpose of this Act. The notice issued by the ITO is not in substance and effect in conformity with the provisions of s. 120 r/w s. 147 of the Act. The notice was issued without jurisdiction. Therefore, the provisions of s. 292B will not be of any help to the Revenue. The provisions of s. 292B could have been invoked if the ITO, was having jurisdiction over the assessee and some mistake was committed in the notice issued by him u/s. 148. Therefore, we do no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f which are contrary to the facts on record. The AO had recorded the following reasons: The assessee Shri Ranjeet Singh has received a sum of Rs. 25,80,678 against acquisition of land on 28th Jan., 1998 and has also received interest of Rs. 13,04,939 on 11th Feb., 1998. Shri Ranjeet Singh has also made FDRs in the names of his family members and interest on such FDRs is assessable in his hand. Since, the assessee has not filed return for the asst. yr. 1998-99 disclosing interest income and capital gain, I have reason to believe that income of Rs. 13,04,939 on account of interest received and capital gain on the sale of land has escaped assessment within the meaning of s. 147 of the IT Act, 1961. In view of reasons recorded as above it was submitted. that the income by way of capital gains was not chargeable to tax as agricultural land did not fall within the purview of s. 2(14) of the Act defining the term 'capital asset'. It was also submitted that on interest of Rs. 13,04,939 tax deducted at source amounting to Rs. 1,46,153 was claimed in the return of income filed before Dy. CIT and credit for the same has been allowed in the intimation dt. 29th June, 1999. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Addl. CIT/Jt. CIT and recording of his satisfaction the learned CIT could not have recorded his satisfaction. Therefore, the requirements of s. 151(2) are satisfied. It was also submitted that the jurisdiction of the AO cannot be challenged by the assessee as per s. 120(2) and s. 120(3) of the Act. The jurisdictional issue cannot defeat the provisions of s. 4, the charging section. She placed reliance on the following decisions: (1) Hindustan Transport Co. vs. IAC (1991) 189 ITR 326 (All); (2) Reckitt Colman of India Ltd. Anr. vs. Asstt. CIT (2002) 172 CTR (Cal) 499 : (2001) 252 ITR 550 (Cal); and (3) B.R. Industries Ltd. vs. CIT Ors. (2002) 175 CTR (Del) 362 : (2002) 255 ITR 593 (Del). She further submitted that any defect in the notice issued under s. 148 will not be fatal to assessment proceedings in view of provisions of s. 292B of the Act. 5. We have heard both the parties and perused the material available on record. We have also gone through the relevant assessment records. In this case notice under s. 148 of the Act was issued by ITO, Ward 2(2), Ghaziabad on 30th March, 2005. From the reasons recorded in Form No. ITNS 10. we find that the approval to r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present AO when received the relevant file from ITO, Ward 2(2), Ghaziabad containing material for proceedings initiated under s. 147 in December, 2005, the time of six years had already elapsed. Therefore, he could not have issued further notice under s. 148 of the Act. Accordingly, the assessment framed on the basis of notice issued without jurisdiction is bad in law and does not have legs to stand. The contention of Revenue that the proposal was routed through the file of the Addl. CIT is of no help when the AO including the learned CIT and Addl. CIT were not having jurisdiction over the case of the assessee on the date when the proposal was sent to the learned CIT, Ghaziabad. Another contention of the learned Departmental Representative is that the assessee cannot challenge the jurisdiction of the AO within the meaning of s. 120. Sec. 120 of the Act confers jurisdiction on IT authorities as per the procedure prescribed therein. Sub-ss. (2) and (3) of s. 120 do not automatically confer jurisdiction on territorial basis in respect of person already assessed to tax under the jurisdiction of other Chief CIT. The assessee was assessed in the charge of Chief CIT, Delhi. No orders were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment, notice, summons or other proceedings, etc. shall be invalid, or shall be deemed to be invalid merely by reason of any mistake or defect or omission in such return of income, assessment, notice, summons or other proceedings, if such return of income, assessment, notice, summons or other proceedings is in substance and effect in conformity with or in according to the intent and purpose of this Act. The notice issued by the ITO, Ward 2(2), Ghaziabad, is not in substance and effect in conformity with the provisions of s. 120 r/w s. 147 of the Act. The notice was issued without jurisdiction. Therefore, the provisions of s. 292B will not be of any help to the Revenue. The provisions of s. 292B could have been invoked if the ITO, Ward 2(2), Ghaziabad, was having jurisdiction over the assessee and some mistake was committed in the notice issued by him under s. 148. Therefore, we do not find any force in the argument of the learned Departmental Representative. 9. In view of the above facts, we are of the considered view that the notice issued by the AO, Ward 2(2), Ghaziabad, was without jurisdiction and consequentially the assessment made is bad in law and deserves to be quas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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