TMI Blog1992 (10) TMI 109X X X X Extracts X X X X X X X X Extracts X X X X ..... assed an order under s. 125A(1) conferring concurrent jurisdiction over this case on the IAC from 1st Nov., 1978. The assessee's contention is that since this concurrent jurisdiction had been conferred the provisions of s. 144B would not be applicable by virtue of sub-s. (7) thereof so that the extension of limitation period available under s. 153, Expln. 1(iv) was not available and that therefore, the normal period of limitation was applicable. Since, the assessment year is 1981-82 the limitation expired on 31st March, 1984. In order to appreciate the controversy it is necessary to set out the material parts of the relevant sections. They are as follows: "125A(1). The Commissioner may by............. order direct that all or any of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Departmental Representative pointed out that the assessee in this case had submitted to the jurisdiction under s. 144B by giving his objections to the draft order and that, therefore, now it was not open to the assessee to take this point regarding applicability of s. 144B relying upon Rai Bahadur Seth Teomal vs. CIT (1959) 36 ITR 9 (SC), Udaipur Distillery Co. vs. CIT (1973) 87 ITR 516 (Raj) and Seth Kanhaiyalal vs. CIT (1937) 5 ITR 739 (All). The learned counsel for the assessee submitted, and in our opinion rightly, that this was a point regarding jurisdiction and there was no question of the assessee waiving his right to object to it. In our opinion, jurisdiction is a matter of law, and if it is taken away by a statute the result is tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that s. 144B was not applicable. In the case of Saraya Sugar Mills although the Special Bench has observed that once the concurrent jurisdiction is conferred on the IAC under s. 125A he was deemed to have exercised the power vested in him, the Tribunal has also noted that the IAC had in fact exercised the powers and performed the functions of the ITO in terms of s. 125A. Therefore, the observation by the Special Bench that the IAC must be deemed to have exercised the concurrent jurisdiction once it is conferred on him is purely obiter. At page 170 of the report the Special Bench has observed in this connection as follows: "In any event the discussion on the aspect of the matter appears to us to be of academic nature in as much as on go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance of the order under s. 125A. The learned counsel for the assessee has submitted that s. 125A(2) makes merely conferment of the powers because according to him, the word "exercise" means mere holding of the powers, i.e., a mere capacity to exercise those powers. The assessee's contention would lead to a very unreasonable result. If s. 144B would become inapplicable merely because concurrent jurisdiction had been conferred on the IAC but not exercised by him then neither the power under s. 144B would be exercised nor the concurrent jurisdiction would be exercised. The case would then not get the benefit of consideration by higher authority which is the purpose both of ss. 125A and 144B. The whole purpose of s. 144B(7) is to avoid a clash ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould depend upon the decision by the relevant authorities either to confer that power or to exercise it as the case may be. The degree of predictability or, as the learned counsel put it, the whim and fancy would in both cases remain the same. Further, cl. (iv) of Expln. 1 in s. 153 speaks of exclusion of a certain period for the purpose of limitation, not that it gives a longer period of limitation as such. That is only the result. Exclusion of a certain period had to be made in order to make s. 144B workable. Therefore, we hold that s. 144B was applicable and the assessment is not barred by limitation. 6. We have, therefore, to deal with the other grounds. The first ground is that (a) the Commissioner erred in confirming the disallowan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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