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TMI Blog2022 (6) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... g of the impugned assessment u/s. 143(3)/147 is bad in law and against the facts and circumstances of the case. 3) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in upholding the action of the Ld. AO in making an addition of Rs. 37,00,000/- allegedly on account of bogus purchases and that too by recording incorrect facts and findings and by disregarding the evidences/submissions filed by the assessee and in violation of principles of natural justice. 4) That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the addition of Rs. 37,00,000/- is bad in law and against the facts and circumstances of the case. 5) That having regard to the facts and circumstances of the case, the Ld. CIT(A) has erred in law and on facts in confirming the action of the Ld. AO in passing the impugned order without giving adequate opportunity of being heard. 6) That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in making the impugned addition is bad in law and against the facts and circumstances of the case. 7) That the appellant craves the leave to add, alter or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for reopening of assessment. The assessee by letter dated 21.12.2015 objected to reopening of assessment stating it as bad in law. It was contended that the reasons recorded are vague and there is no material evidence for forming the belief that income has escaped assessment. However, the reassessment was completed on 28.12.2015 u/s. 147 read with section 143(3) of the Act determining the income of the assessee at Rs. 38,11,090/- by the Income Tax Officer, Ward 1(3), Ghaziabad. Assessee contends that the notice u/s. 148 was issued by the ITO, Ward 70(3), New Delhi, whereas the jurisdictional AO was ITO, Ghaziabad and, therefore, since the notice for reopening of assessment was issued by non-jurisdictional authority the reassessment proceedings are invalid and, the assessment order passed in pursuance to such notice is a nullity. 5.1. On perusal of the notice issued u/s. 148 it is observed that ITO, Ward 70(3), New Delhi has issued notice u/s. 148 for reopening the assessment of the assessee who is a resident of Ghaziabad and filing returns in Range-1, Ghaziabad. The assessee filed returns for the assessment years 2006-07 and 2008-09 in Range-1, Ghaziabad as is evident from pages 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge of jurisdiction vide order Under Section 120 of 1.8.2001 it is settled principle of law that jurisdiction cannot be assumed by consent. It has to be given by the statute or by the authorities under the statute who are empowered in this behalf. Firstly, the Assessing Officer, ACIT, Range-IV, Lucknow ought to have transferred the proceedings relating to assessment year 2001-02 to the addl. CIT, Range-1, Lucknow immediately after receipt of order Under Section 120. An order Under Section 120 operates not only against the assessee but also against the Assessing Officer holding jurisdiction at the time of passing of the order Under Section 120. To continue with the proceedings after passing of the order Under Section 120; by the same old officer would be without jurisdiction and hence would be bad in law. Learned D.R. submits that Section 124(3) protects assessments so framed if the assessee does not object within a month of initiation of such proceeding. In our considered view, this validation of proceeding by virtue of Section 124(3) is specific from proceeding to proceeding and Section 124(3) cannot correct or create a jurisdiction in respect of other proceedings if the Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee was originally assessed for the assessment year 1997-98 for which return was filed on 30.11.1997 along with the annual accounts and auditors report. An intimation Under Section 143(1)(a) was issued by ACIT, Range-IV, Lucknow on 24.7.1998. Thereafter the Assessing Officer (ACIT, R-IV, Lucknow) issued notice Under Section 148(1) on 29.3.2004. The protection of proceedings initiated Under Section 148(1) is covered by Clause (b) only and not by Clause (a) (if assessee does not object within a month). Clause (b) is applicable only in respect of those assessees who have not filed any return Under Section 139 for the relevant assessment year. Since the assessee had in fact filed a return Under Section 139 for the assessment year 1997-98 the protection to the proceeding initiated Under Section 148(1) in the case of this assessee will not be available to the revenue by virtue of Clause (b). But such protection will also not be available (on failure to protest within one month of the proceedings) under Clause (a) as that is not applicable to a proceeding initialed Under Section 148(1). Thus, in the present ease, it would be immaterial whether assessee has objected within one month of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f jurisdiction cannot, in general, be validated. Such validation is specific in Section 124(3). Secondly, principles of estoppel are not applicable to Income tax proceedings. What may be acceptable or held in one year or in one proceeding cannot be in general held to be applicable to other proceedings. It is held by Hon'ble Gujarat High Court in Anant Mills Ltd. v. CIT (Supra) that estoppel is not applicable to successive assessments. In any case, estoppel cannot be made applicable to assumption of jurisdiction. It has to be specifically provided in the statute. We, therefore, do not find any force in the arguments in this regard submitted by the Learned D.R. The same are, therefore, rejected. So far as the merit of the case is concerned, in our considered view they are merely academic as reassessment is cancelled as having been initialed without jurisdiction. 29. As a result, we hold that the issuance of notice Under Section 148(1) by ACIT, Range-IV. Lucknow was without jurisdiction and therefore, invalid. The assessment framed on that basis by Addl. CIT. Range-1. Lucknow will also be invalid and therefore, is cancelled. The appeal of the assessee is therefore, allowed. 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, the assessee had not claimed losses incurred in the business as there was no remote chance to continue the business in near future. After the assessment year under consideration, assessee has also not carried out any business activity. Except this business loss of Rs. 34,779/-, there was no difference between the original return filed and return filed under section 148. During the year in consideration, the assessee has made total purchases of Rs. 38,30,153/- and sales of Rs. 40,05,000/- against which how the purchases of Rs. 37,00,000/- can be disallowed. Therefore, purchase of Rs. 37,00,000/- can't be added in income to the year under consideration against the only sales of Rs. 40,05,000/-. It is respectfully submitted that the reopening of the present case and the subsequent proceedings thereto are bad in law and are not in accordance with law. The reason recorded is vague and there is no material evidence for forming the belief that income has escaped assessment. We seriously object these proceedings. Hope you will find everything in order. Thanking you, For Kamlesh Kumar Agarwal Sd/- Sunil Agrawal (Authorised Representative) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ;DTAA') between the India and the USA, there was no need for the Assessee to charge tax or withhold tax under Section 195 of the Act. Therefore, on merits the CIT(A) deleted the disallowance of the above deduction. The CIT(A) also noted that the said expenses were not disallowed in AY 2004-05 "even when the assessment for the said order so completed with the disallowance of this order." 8. The above findings on merits in Ground 4 by the CIT(A) in favour of the Assessee, was not challenged by the Revenue before the ITAT in ITA No. 2140/Del/2011 for 2003-04. With the Revenue not having challenged the order of the CIT(A) deleting the disallowance made by the AO pursuant to the reopening of the assessment, the challenge by the Revenue only to that portion of the order of the ITAT holding that the reopening was not legally sustainable, renders the issue academic. 9. Consequently, for both the aforementioned reasons, viz., that there was a failure by the AO to comply with the mandatory requirement of disposing of the objections of the Assessee to the reopening in terms of the law explained by the Supreme Court in G.K.N. Driveshafts (India) Ltd. (supra) as well as on account of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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