TMI Blog2013 (8) TMI 694X X X X Extracts X X X X X X X X Extracts X X X X ..... before them, come within the jurisdiction of the newly conferred authorities unless any specific provision is made in respect of any pending proceedings. Such consequence is inevitable when there is withdrawal of jurisdiction, which means automatic extinction of jurisdiction of one authority with simultaneous conferment of jurisdiction on another authority under the Act in respect of all pending and future proceedings. Explanation to section 127 of the Act makes it clear that the word "case" in relation to any person whose name is specified in the order of transfer means all proceedings under the Act in respect of any year which may be pending on the date of the transfer, and also includes all proceedings under the Act which may be commenced after the date of transfer in respect of any year. The word "case" is thus used in a comprehensive sense of including both pending proceedings and proceedings to be instituted in the future. Consequently, an order of transfer can be validly made even if there be no proceedings pending for assessment of tax and the purpose of the transfer may simply be that all future proceedings are to take place before the officer to whom the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... But, in the meantime, CIT-1, Delhi passed an order u/s. 127(2) transferring the jurisdiction of this case vide its order No.CIT-1/Cent/09-10/1874 dated 04-01-2010 from ITO, Ward-3(3), New Delhi to ITO, Ward-6(1), Kolkata. The assessee claimed before the AO as well as before CIT(A) that ITO, Ward-3(3), New Delhi did not have jurisdiction to issue notice u/s. 148 of the Act on 25-03-2010 as the case was transferred u/s. 127(2) of the Act from New Delhi to Kolkata on 04-01-2010. The assessee before CIT(A) filed written submissions as under: "This appeal is against the reopening of assessment u/s. 147 of the I. T. Act 1961. The assessee has challenged the reopening by the ITO Ward 3(3) Delhi. The notice u/s. 148 of the I.T. Act 1961 was issued by the ITO Delhi after receipt of approval from Additional CIT Delhi on 25-03-2010. However the CIT Delhi had passed an order u/s. 127 transferring the file to Kolkata on 4-1-2010 as such on 25-3-2010 the AO in Delhi did not have jurisdiction over the case, hence the reopening it without jurisdiction as it is based on the notice u/s. 148 of the I. T. Act, 1961 issued by the ITO Delhi. We have requested the AO at Kolkata to issue the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. Miraj D. Shah, Advocate attended the proceedings filed written submission of one paper along with the copy of reasons recorded, order sheet of 147 proceedings given. The appellant has submitted that file was transferred to Kolkata on 4-1-10 by order u/s 127. Copies of order u/s 127 and section 151 approved by Addl. CIT to be submitted tomorrow. The issue of jurisdiction of Delhi A.O. was not taken before the A.O. who completed the assessment. Adj. to 20-2-12." 4. CIT(A) discussed the issue and observed in paras 8 and 9 as under: "8. The appellant submitted during the appellate proceedings that he does not submit any additional evidences, books of account or other documents either before the appellate authority or Assessing Officer since these are not available with appellant. The appellant has never taken objection regarding the jurisdiction of issuance of notice u/s 148 by the Assessing Officer of New Delhi or initiation/continuation of assessment proceedings by the Income-tax Officer, Ward 6(1), Kolkata before the Assessing Officer during the assessment proceedings even when the authorised representative attended the proceedings on 08-12-2010 and 16-12-2010 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd he further submitted that the jurisdictional Assessing Officer at Delhi has rightly re-opened the case after due approval from his jurisdictional Joint commissioner of Income-tax and issued notice u/s 148 before actually transferring the case. 19. The appellant never raised the question of jurisdiction before the Assessing Officer either at New Delhi when the notice u/s 148 was issued or at the time of assessment with the Assessing officer at Kolkata. There was a possibility to the Assessing Officer at New Delhi to get the records transferred immediately to Kolkata and a fresh notice may have been issued during the time-limitation by Assessing Officer at Kolkata. 20. Following the law laid down and upheld by the Hon'ble appellate authorities as discussed above, the legal provisions of section 124(3) on this issue and in the facts and circumstances of the case, it is held that the assessment order passed u/s 147/144 of the I.T. Act 1961 is not without jurisdiction and is as per law and hence the assessment order passed by the Assessing Officer is held to be a valid order. In the facts and circumstances of the case the proceedings u/s 148 of the I T Act 1961 is uphel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such a plea can be accepted or not? Before us, Ld. Sr. DR heavily relied on the decision of Hon'ble Punjab Haryana High Court in the case of Subhash Chander v. CIT [2008] 166 Taxman 307(P H) wherein the non-objection as per section 124(2) read with section 124(4) of the Act, the jurisdiction assumed by AO was held to be valid. Further, there was reliance by Sr. DR on the case law of Hon'ble Allahabad High Court in the case of CIT v. British India Corpn. Ltd. [2011] 337 ITR 64(All), wherein assumption of jurisdiction, by AO for assessment, u/s. 124 of the Act that when the ITO had jurisdiction when assessment proceedings commenced and a draft assessment order was submitted to IAC but due to subsequent change in jurisdiction, unless the same brought to the notice of the authority concerned, the assessment would not be vitiated. We are with the argument of Ld. Sr. DR in respect to this argument that where the jurisdiction assumed by the AO, assessee has to object to the same u/s. 124 of the Act in case hr us aggrieved. But, what will be the effect of the order of Commissioner of Income-tax transferring the jurisdiction u/s. 127 of the Act. We are of the view, that when any case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anation to section 127 of the Act makes it clear that the word "case" in relation to any person whose name is specified in the order of transfer means all proceedings under the Act in respect of any year which may be pending on the date of the transfer, and also includes all proceedings under the Act which may be commenced after the date of transfer in respect of any year. The word "case" is thus used in a comprehensive sense of including both pending proceedings and proceedings to be instituted in the future. Consequently, an order of transfer can be validly made even if there be no proceedings pending for assessment of tax and the purpose of the transfer may simply be that all future proceedings are to take place before the officer to whom the case of the assessee is transferred. 8. In view of the above principle regarding jurisdiction and facts of the present case, the order passed by CIT-1, Delhi, transferring jurisdiction from ITO, Ward-3(3), New Delhi on 04-01-2010, subsequent action of the AO i.e. ITO, Ward-3(3), New Delhi issuing notice u/s. 148 of the Act dated 25-03-2010 is invalid because the jurisdiction from ITO, Ward-3(3), New Delhi by CIT-1, Delhi to ITO, Ward-6(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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