TMI Blog2007 (7) TMI 424X X X X Extracts X X X X X X X X Extracts X X X X ..... ted. It could operate only against the loss, exemption, and allowance or relief claimed which is inadmissible. According to revenue the change of head with regard to income from business to other sources falls within the scope of this limited scrutiny assessment and not within the scope of section 143(2) on which we are unable to subscribe to. Thus, we are of the view that his going beyond the scope of the notice is improper and therefore the CIT(A) rightly decided the issue in favour of the assessee. In the result, appeal by the revenue fails and dismissed. - K.P.T. THANGAL AND D.K. SRIVASTAVA, JJ. For the Appellant : P.K. Bajaj For the Respondent : Ajay C. Gogalia. JUDGMENT K.P.T. Thangal, Vice President . - This appeal by the revenue is directed against the order of the CIT(A) in quashing the order under section 143(3)( i ) passed by the Assessing Officer and holding that the same as null and void ab initio. 2. Assessee filed the return on 10-10-2001 declaring income at Rs. 69,120. Subsequently refund of Rs. 1,19,998 was given to the assessee. Thereafter the case was selected for scrutiny. Notice was issued under section 143(2)( i ) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further contended that if the Assessing Officer wants to make detailed scrutiny then notice is to be issued under clause ( ii ) of sub-section (2) of section 143 of the Income-tax Act. It was contended that in the instant case the Assessing Officer passed this order after making detailed scrutiny. As a result of the scrutiny Assessing Officer has changed the head Income from business to Income from other Sources which was never intended by the Assessing Officer in the notice issued under section 143(2)( i ) of the Income-tax Act. In the notice he intended to treat business income as income from house property, which is also not the requirement of section 143(2)( i ). 5. Assessee s representative submitted that the assessment order has not been passed as per the provisions of section 143(3)( i ) but it has been passed as per the provisions of section 143(3)( ii ) of the Act. Assessing Officer issued notice under section 143(2)( i ) to change the head of income from business to property and later on it was changed from property to other sources. Hence, assessee s representative submitted that Assessing Officer failed to follow provisions of limited scrutiny but has done a de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble Rajasthan High Court in the case of Deepchand Kothari v. ACIT 171 ITR 381 has held that an order passed by an authority without jurisdiction is a nullity and it is invalid can be challenged whenever and wherever it is sought to be enforced or relied upon. It has also been further held that the objection regarding the lack of jurisdiction is to be decided first. Only after its decision holding that the court or the Tribunal has jurisdiction, other questions relating to the merits of the case arise for decision, otherwise not. In view of the above, the appeal is allowed and order passed by the Assessing Officer is quashed. Revenue is in appeal before the Tribunal. 6. The learned DR supported the order of the Assessing Officer whereas the learned representative of the assessee submitted that apparently the Assessing Officer issued notice dated 28-10-2002 under section 143(2)( i ) as he desired to verify the claim of loss, exemption, deduction, allowance or relief claimed by the assessee against rent income of Rs. 6 lakhs. However, instead of restricting himself to the limited notice issued under section 143(2)( i ) Assessing Officer not only enquired into the nature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... As the Assessing Officer had not served a notice under section 143(2)(ii), he did not have the necessary jurisdiction to pass the order, being devoid of jurisdiction, and therefore the ld. CIT(A) was justified in annulling the Assessing Officer s order. On the above propositions the Respondent relied upon the following : (1998) 230 ITR 495 (Bom.) (See Paras 9 10) (2004) 88 ITD 37 (Chennai) (See Para 7) (1986) 19 ITD 488 (Indore) (See Para 5) ( ii ) Secondly, The ld. CIT(A) disposed off the Respondent s appeal by passing an order on 16-2-2004. On that date the period of 12 months specified in the proviso to section 143(2) had already expired. The ld. CIT(A) had not power to remove the bar of limitation prescribed under the proviso to section 143(2). He, therefore, could not confer jurisdiction upon the Assessing Officer to serve notice under section 143(2)(ii) upon the Respondent and if at all such a direction was issued it would be neither lawful nor valid. On this proposition the respondent relies upon (1996) 60 ITR 647 (Madras) (See Paras 4, 15 16) (1963) 49 ITR 13 (Madras) (See Para 13) (c) Re: Query i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cording to revenue the change of head with regard to income from business to other sources falls within the scope of this limited scrutiny assessment and not within the scope of section 143(2) on which we are unable to subscribe to. 10. Further, a reading of section 143(3)( i ) makes it clear that as per section 143(2)( i ) the power of the Assessing Officer is limited. The section 143(3)( i ) says that the Assessing Officer shall by an order in writing, allow or reject the claim or claims specified in such notice and make an assessment determining the total income or loss accordingly,. . .The wording allow or reject the claim specified in such notice makes it clear that the Assessing Officer can allow or reject the claim or claims specified in such notices and make assessment determining the total income or loss accordingly. This means that his power does not go beyond the claim or claims specified in the notice. If he wants to go further for full scrutiny then he has to issue notice under section 143(3)( ii ) wherein there is no such restriction has been put. 11. In view of the above, we are of the view that his going beyond the scope of the notice is improper and there ..... X X X X Extracts X X X X X X X X Extracts X X X X
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