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2025 (5) TMI 447 - HC - Income TaxReopening of assessment u/s 147 - as argued procedure u/s 148A was not followed proper sanction was not obtained u/s 151 and AO had no territorial jurisdiction to issue a notice under Section 148 of the Act or to conduct the reassessment proceedings - HELD THAT - As Petitioner now seeks to assail the order passed u/s 127 and has advanced submissions on two fronts first that the order passed u/s 127 of the Act is invalid on the ground that it assumes that the Petitioner is an assessee located in Delhi; and second that no notice was issued to the Petitioner before passing the said order. Clearly none of these grounds find mention in the present petition as according to the Petitioner no such order existed. Other contentions are concerned considering that the Petitioner is also challenging the assessment order on merits we do not consider it apposite to entertain the same. We dispose of the present petition by leaving it open for the Petitioner to avail the statutory remedies. Petitioner requests that the time for filing the appeal against the impugned order may be extended as the same has elapsed. Mr. Chandra learned counsel for the Revenue fairly states that he has no objection if the same is extended by a period of two weeks. We direct that in the event the Petitioner avails the statutory remedies in respect of the impugned order within a period of two weeks from date the same would be considered by the concerned authority uninfluenced by the question of delay. All rights and contentions of the parties are reserved and the Petitioner would not be precluded from assailing the impugned order inter alia on the grounds as urged in the present petition. Additionally we clarify that the Petitioner is also at liberty to avail other remedies in respect of the order dated 17.12.2024 passed u/s 127 of the Act.
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered by the Court include:
2. ISSUE-WISE DETAILED ANALYSIS Validity and Jurisdiction of Notice under Section 148 of the Act The petitioner challenged the reassessment notice issued under Section 148 on multiple grounds, including procedural non-compliance with Section 148A and absence of sanction under Section 151. The petitioner also contended that the AO lacked territorial jurisdiction since the petitioner was assessed in Gurugram but the notice was issued by the AO in Delhi. The legal framework governing reassessment notices under the Income Tax Act mandates strict adherence to procedural safeguards, including the issuance of a notice under Section 148A before initiating reassessment and obtaining sanction under Section 151. Additionally, territorial jurisdiction is a critical factor; reassessment notices must be issued by the AO having jurisdiction over the assessee's case unless an order under Section 127 centralises jurisdiction. The Revenue initially contended that an order under Section 127 had been passed, which would validate the AO's jurisdiction. However, confirmation was sought, and the matter was adjourned to verify the existence of such an order. Upon production of the Section 127 order dated 17.12.2024, which centralised assessments and included the petitioner, the Court found that the AO's jurisdiction was legally conferred. Consequently, the impugned reassessment orders could not be said to be wholly without jurisdiction. The petitioner then sought to challenge the validity of the Section 127 order itself, on grounds that it incorrectly assumed the petitioner's location and was passed without issuing notice to the petitioner. These grounds were not raised in the original petition, as the petitioner had initially denied the existence of any such order. The Court noted that these challenges to the Section 127 order were not presently before it and that the petitioner was at liberty to raise such contentions through appropriate statutory remedies. Challenge to Additions on Merits The petitioner also sought to challenge the substantive additions made in the reassessment order. The Court observed that such challenges are ordinarily to be addressed through the statutory appellate process and declined to entertain them in the writ petition, emphasizing the availability of efficacious statutory remedies. Availability of Statutory Remedies and Court's Jurisdiction The Revenue raised a preliminary objection regarding the petitioner's access to efficacious statutory remedies, suggesting that the writ petitions were not maintainable. The Court concurred, holding that the petitioner must pursue the prescribed appeal mechanisms under the Act rather than seek relief by way of writ petitions. However, recognizing the petitioner's request for extension of time to file appeal against the impugned order, the Court granted a two-week extension and directed that any appeal filed within this period be entertained without regard to delay. Application of Law to Facts and Treatment of Competing Arguments The Court carefully balanced the petitioner's procedural objections against the statutory framework and the existence of the Section 127 order. While the petitioner argued that the AO lacked jurisdiction and that procedural requirements were not met, the Court found that the Section 127 order, duly passed and listing the petitioner, conferred jurisdiction on the AO. The petitioner's failure to raise objections to the Section 127 order at the earliest stage was noted. The Court also considered the Revenue's contention regarding the availability of statutory remedies and accepted that the petitioner should pursue those remedies rather than seek writ relief. The Court reserved all rights and contentions of the parties, explicitly stating that the petitioner would not be precluded from assailing the impugned order and the Section 127 order through appropriate channels. 3. SIGNIFICANT HOLDINGS The Court held that:
The core principles established include:
On the final determinations:
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