Tax Management India. Com
                        Law and Practice: A Digital eBook ...

Category of Documents

TMI - Tax Management India. Com
Case Laws Acts Notifications Circulars Classification Forms Manuals SMS News Articles
Highlights
D. Forum
What's New

Share:      

        Home        
 

TMI Blog

Home List
← Previous Next →

2019 (12) TMI 136

..... Moulviganj, Lucknow [2017 (3) TMI 1792 - ALLAHABAD HIGH COURT], thus, in effect, holds, answering the question in favour of the assessee, that where a notice u/s 148 was issued by an incompetent officer, i.e., one who has no jurisdiction, and subsequently, on the objection of the assessee with regard to the jurisdiction, the matter is transferred to the Assessing Officer having jurisdiction, a valid assessment cannot be made by him without issuing a fresh notice under section 148. Since the AO, having jurisdiction over the assessee, completed the reassessment without issuance of notice under section 148, the reassessment order passed is invalid and cannot be sustained. It is, accordingly, set aside and cancelled. - Decided in favour of assessee. - IT APPEAL NO. 646 (LKW.) OF 2018 - 20-9-2019 - A.D. Jain, Vice-President P.K. Kapoor, C.A for the Appellant. Ajay Kumar, D.R for the Respondent. ORDER 1. This is assessee's appeal against the order of the ld. CIT(A)-2, Lucknow, dated 29/8/2018, confirming the Assessing Officer's action in making the addition of ₹ 3.45 lakhs, comprising of ₹ 3.15 lakhs paid as stamp duty and ₹ 30,000/- paid in cash, on purchase of .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... is mother. 8. BECAUSE the "appellant" had submitted the cogent evidences before the authorities below in support of availability of funds with his mother which became available to the "appellant" for meeting the cost of stamp duty and registration expenses for purchase of immovable property and consequently, "CIT(A)" was not justified in rejecting the same so as to sustain the addition of ₹ 3,45,000/- made by the Assessing Officer. 9. BECAUSE the order appealed against is contrary to the facts, law and principles of natural justice. 2. Addressing ground No.3 first, the ld. counsel for the assessee has contended that the re-assessment order passed by the Dy. CIT, Range-6, Lucknow, cannot be held to be valid in the eye of law; that the ITO-1(3), Lucknow had initiated proceedings under section 147 of the IT. Act by issuing notice under section 148 of the Act, dated 26/9/2013 (APB:8); and that during the course of assessment proceedings, the assessee had submitted to the ITO-1(3) that he was a Director in M/s Surat Construction Pvt. Ltd., which was assessed in Range-6 and that accordingly, the jurisdiction in the case of the assessee was with ITO-6(3 .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... he Amritsar ITAT, in ITA No.88/Asr/2011, CO No.4/Asr/2011, ITA No.247/Asr/2011 and CO. No.13/Asr/2011, for assessment year 2007-08 (copy placed on record). 4. Per contra, the ld. D.R. has contended that as rightly held by the ld. CIT(A), the assessee had himself submitted before the Assessing Officer, that the jurisdiction of the assessee's case vests with, DCIT, Range-6, Lucknow, since the company, M/s Surat Construction Pvt. Ltd., where he had been working as a Director, was assessed to tax with Range-6, Lucknow; that it was only on this basis, that the case was transferred by the ITO-1(3), Lucknow, to the DCIT, Range-6, Lucknow; that the DCIT, Range 6 continued the proceedings initiated by the ITO-1(3); and that as such, the reassessment order passed by the DCIT, Range-6 does not suffer from any infirmity on this count. 5. Heard. The ITO-1(3) issued notice under section 148 of the Act. The ITO-1(3) undisputedly did not have jurisdiction over the matter. The matter was transferred, on the assessee's request, to the DCIT, Range-6, who, admittedly, was the Assessing Officer having jurisdiction. The DCIT, Range-6 passed the reassessment order, without issuance of any notice, .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... p.M/s M.R. Garments Moulviganj, Lucknow' (supra), the question formulated by the Hon'ble jurisdictional High Court was that if a notice under section 148 of the Act was issued by an incompetent officer, i.e., one who has no jurisdiction, and subsequently, on the objection of the assessee with regard to the jurisdiction, the matter is transferred to the Assessing Officer having jurisdiction, can a valid assessment be made by him without issuing a fresh notice under section 148 of the Act. 8. The observations of their Lordships (relevant paras) are as under: '17. The sole ground found favour with Tribunal is that notice under Section 148 of Act, 1961 was issued by ITO-IV(1), Lucknow who had no jurisdiction in the matter and after transfer of case, ITO. V(2) who had jurisdiction in the matter, proceeded to make assessment without issuing notice under Section 148 of Act, 1961 which was mandatory, being a jurisdictional step. Earlier notice issued by an authority having no jurisdiction would vitiate the entire proceedings as said notice issued by an incompetent Authority will not be a valid notice under section 148 of the Act. ** ** ** 33. Notice under Section 148 was not is .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... Assessing Officer who had concluded the proceedings." 41. We, however, do not go to that extent for the reason that there may be any subsequent change resulting in change of jurisdiction of A.O. Notice of reassessment can be issued by such an Officer but not by Officer who has no jurisdiction for assessment/reassessment. 42. In Commissioner of Income Tax v. Rajeev Sharma 2011 (336) ITR 678, Court observed "provisions contained in Section 148 of Act, 1961 with regard to escaped assessment must be construed strictly with regard to procedure prescribed for escaped assessment." 43. The reason for issuance of notice by Competent A.O. is quite obvious inasmuch as such notice could have been issued only when concerned A.O. has reason to believe that some income has escaped assessment and recomputation/reassessment is needed. Now such satisfaction can be of that A.O. only who has jurisdiction in the matter and not of any third party. 44. We, therefore, hold that in the present case, no valid notice under Section 148 was issued by Jurisdictional A.O. before making assessment/reassessment and, therefore, proceedings of reassessment pursuant to notice issued under Section 148 .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... ce does not confer Jurisdiction and erroneous interpretation should not be permitted to perpetuate and perpetrate defeating of legislative animation. 51. In Abdul Qayume v. Commissioner of Income Tax 1990 (184) ITR 404, Court said "an admission or an acquiescence cannot be a foundation for assessment where the income is returned under an erroneous impression or misconception of law." 52. It is well settled that a jurisdiction can neither be waived nor created even by consent and even by submitting to jurisdiction, an Assessee cannot confer upon any jurisdictional authority, something which he lacked inherently. 53. Even if, it can be said that Assessee submitted to jurisdiction of A.O., law is that Assessee cannot confer jurisdiction on an authority who did not have the same and we find support from Commissioner of Income Tax v. Hari Raj Swarup and sons (1982) 138 ITR 462 (Alld.). 54. In Mir Iqbal Husain v. State of U.P. 1963 50 ITR 40 (SC), it was held that requirement of valid notice cannot be waived. The mere fact that Assessee filed Return of Income pursuant to invalid notice would not render notice valid or validate subsequent proceedings which are vitiated in law fo .....

X X X X X X X

Full Text of the Document

X X X X X X X

 

 

← Previous Next →

 

 

|| Home || About us || Feedback || Contact us || Disclaimer || Terms of Use || Privacy Policy || Database || Members || Refer Us ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.
|| Blog || Site Map - Recent || Site Map ||