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2023 (2) TMI 581 - HC - Income TaxFaceless Assessment Scheme as stipulated in Section 144(B) - no hearing had been given before passing the assessment order - Necessity of issuance of prior show cause notice-cum-draft assessment order before issuing the impugned assessment order - HELD THAT:- The Delhi High Court in case of Interglobe Enterprises Private Limited vs. National Faceless Assessment Centre Delhi and Another [2021 (7) TMI 1044 - DELHI HIGH COURT] it had held that Section 144(B)(7) mandatorily provides for issuance of prior show cause notice-cum-draft assessment order before issuing the impugned assessment order. It also provides for an opportunity of personal hearing if requested by the assessee. In absence of prior show cause notice as well as draft assessment order, no hearing had been given before passing the assessment order. The Court held it to be a blatant violation of principles of natural justice as well as mandatory procedure prescribed in Faceless Assessment Scheme as stipulated in Section 144(B) of the Act. In the instant case, the action of the respondent being in clear breach of requisite necessity of availing an opportunity to the petitioner on serving upon it the show cause noticecum- draft assessment order, the assessment order which has been finalized, deserves interference. Jurisdictional issue raised by respondent on the ground that the PAN of the petitioner is at Churu, Rajasthan - A communication is made by the Income Tax Officer, Ward-1, Churu addressed to the Principle Commissioner of Income Tax, Jaipur-2, Rajasthan for transfer of PAN from ITO, Ward-1, Churu to DCIT, Circle-3(3), Pratyaksha Kar Bhavan, Ambawadi, Ahmedabad, wherein it is stated that request letter has been received from the assessee firm for transfer of its PAN ABFFA6446E from ITO, Ward-1, Churu to DCIT, Circle-3(3), Pratyaksha Kar Bhavan, Ambawadi, Ahmedabad. The officer further has stated that he has no objection to such transfer. The assessee firm was incorporated on 06.07.2016 and as per the record, neither the assessee firm nor any of the partners of the assessee firm has any link with the territorial jurisdiction of Ward-1, Churu. Request was made to pass necessary order under Section 127 of the Act urging for appropriate territorial jurisdiction of the assessee i.e. DCIT, Circle-3(3), Pratyaksha Kar Bhavan, Ambawadi, Ahmedabad. Not only the petitioner is residing in Ahmedabad, but, he continues to do its business and operates from the State of Gujarat. For whatever reasons its PAN ABFFA6446E is with ITO, Ward-1 Churu, he already has made a request in the month of November, 2021 for the transfer with a further request that necessary directions to be issued for long term effect of this. As emphatically urged that there is no way in which the petitioner has contributed to the matter going on before the ITO, Ward-1, Churu. He has no connection with Rajasthan and therefore, he has made an application before the concerned authority. This is not only a unilateral request which has come from the petitioner, but, the Income Tax Officer looking after this aspect has also made a request for such transfer. Undoubtedly, the part of cause of action has arisen in Gujarat. The Supreme Court’s decision in case of Rajendran Chingaravelu vs. R.K.Mishra, Additional Commissioner of Income-tax [2009 (11) TMI 341 - SUPREME COURT] was considering the maintainability of the petition under Article 226 of the Constitution of India to hold that whether even if a small fraction of cause of action arises within the jurisdiction of the State, the same would accrue within the territory of the State and the State would have a jurisdiction. Even the smallest part of cause of action when arises within the jurisdiction of this Court, it would have a jurisdiction to decide the matter and therefore also, contention raised by the respondent will have no bearing. Petition is accordingly ALLOWED quashing and setting aside the order passed by the respondent under Section 143(3) of the Act assessing total income of the petitioner with all consequential proceedings.
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