TMI Blog2022 (6) TMI 227X X X X Extracts X X X X X X X X Extracts X X X X ..... VT. LTD., BINDHYAWASINI DEVELOPERS PVT. LTD. VERSUS DCIT, CIRCLE-13 (1) , KOLKATA [ 2021 (2) TMI 181 - ITAT KOLKATA] . Thus the assessment order passed by the Assessing Officer (DCIT) was bad in law for want of issuance of notice u/s 143(2) of the Act. Jurisdiction of Assessing Officers - assessment order passed by the DCIT, Kolkata - Since, in this case, the assessee not only mentioned in the return of income his address as Gandhidham, Gujarat but also brought the said fact into the notice of concerned authorities well in advance in response to the notice u/s 142(1) itself, stating therein that the principal place of business of the assessee was at Gandhidham and the entire operation of the assessee was carried out in the State of Gujarat only, however, neither the Commissioner acted on the aforesaid objection/application of the assessee nor did the DCIT/Assessing Officer referred the matter to the competent authority for transfer of the case to the officer of competent territorial jurisdiction. In view of the provisions of section 124 of the Act, the DCIT, Kolkata did not have any territorial jurisdiction to frame the impugned assessment order, therefore, the assessment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1961 was without jurisdiction and bad in law and thus the entire assessment order be quashed and or cancelled. 2. A perusal of additional/legal grounds of appeal reveals that the assessee through these grounds has contested the jurisdiction of the concerned Assessing Officer/Deputy Commissioner of Income Tax (DCIT) to frame assessment order dated 25.03.2015 u/s 143(3) of the Act. The ld. counsel for the assessee has submitted that the concerned Assessing Officer did not have jurisdiction to frame the assessment firstly, on the ground that a notice u/s 143(2) was mandatorily required to be issued by the concerned Assessing Officer to assume jurisdiction to frame assessment. He in this respect has relied upon Hon ble Supreme Court in the case of ACIT vs. M/s Hotel Blue Moon reported in 321 ITR 362(SC); secondly, the ld. counsel has submitted that even the concerned DCIT, Kolkata did not have territorial jurisdiction to pass the impugned assessment order. 3. Since assessee through the additional legal grounds is hitting at jurisdiction of the concerned Assessing Officer to frame the impugned assessment order, therefore, we deem it proper to admit the aforesaid additional leg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a non to assume jurisdiction to frame assessment u/s 143(3) of the Act. He, in this respect, has relied upon the decision of the Hon ble Supreme Court in the case of ACIT vs. M/s Hotel Blue Moon (supra). The ld. counsel, therefore, has submitted that in this case the concerned DCIT did not issue any notice u/s 143(2) of the Act before proceeding to frame assessment u/s 143(3) of the Act. He has submitted that since the concerned ITO, Ward-1(1) did not have jurisdiction to issue notice u/s 143(2) of the Act as such the said notice issued by him did not have any legal sanctity. He, therefore, has submitted that the assessment framed by the DCIT, in this case, was bad in law for want of issue of notice u/s 143(2) of the Act. The ld. DR could not rebut the aforesaid legal position based on aforesaid factual aspect put by the ld. counsel for the assessee. However, she has relied upon the findings given by the Assessing Officer in the assessment order. 5. We have considered the rival contentions of ld. representatives of both the parties and gone through the records. Before proceeding further, it will be appropriate to refer to section 120 of the Act which, for the sake of ready re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ost of compliance. The Board had considered the matter and is of the opinion that the existing limits need to be revised to remove the abovementioned hardship. An increase in the monetary limits is also considered desirable in view of the increase in the scale of trade and industry since 2001, when the present income limits were introduced. It has therefore been decided to increase the monetary limits as under: Income Declared (Mofussil Income Declared areas) (Metro cities) ITOs ACs/DCs ITOs DCs/ACs Corporate returns Upto Rs. 20 lacs Above Rs. 20 lacs Upto Rs. 30 lacs Above Rs. 30 lacs Non-corporate returns Upto Rs. 15 lacs Above Rs. 15 lacs Upto Rs. 20 lacs Above Rs. 20 lacs Metro charges for the purpose of above instructions shall b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1), Kolkata, had issued notice u/s 142(1) of the Act to the assessee. The DCIT, Circle-11(1), Kolkata, completed assessment u/s 143(3) of the Act on 14/03/2016. The issue is whether an assessment order passed by DCIT, Circle-11(1), Kolkata, is valid as admittedly, he did not issue a notice u/s 143(2) of the Act, to the assessee. This issue is no more res-integra. This Bench of the Tribunal in the case of Soma Roy vs. ACIT in ITA No. 462/Kol/2019; Assessment Year 2015- 16, order dt. 8th January, 2020, under identical circumstances, held as under:- 5. After hearing rival contentions, I admit this additional ground as it is a legal ground, raising a jurisdictional issue and does not require any investigation into the facts. The ld. Counsel for the assessee submitted that as per Board Instruction No. 1/2011 [F. No. 187/12/2010-IT(A-I)], dt. 31/01/2011, the jurisdiction of the assessee is with the Assistant Commissioner of Income Tax, Circle-1, Durgapur, as the assessee is a noncorporate assessee and the income returned is above Rs.15,00,000/- and whereas, the statutory notice u/s 143(2) of the Act, was issued on 29/09/2016, by the Income Tax Officer, ward-1(1), Durgapur, who ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non- corporate person i.e. like assessee, the pecuniary jurisdiction lies before AC/DC. In this case, admittedly, the assessee an individual (non corporate person) who undisputedly declared income of Rs.50,28,040/- in his return of income cannot be assessed by the ITO as per the CBDT circular (supra). From a perusal of the assessment order, it reveals that the statutory notice u/s. 143(2) of the Act was issued by the then ITO, Ward-1, Haldia on 06.09.2013 and the same was served on the assessee on 19.09.2013 as noted by the AO. The AO noted that since the returned income is more than Rs. 15 lacs the case was transferred from the ITO, Ward-1, Haldia to ACIT, Circle-27 and the same was received by the office of the ACIT, Circle-27, Haldia on 24.09.2014 and immediately ACIT issued notice u/s. 142(1) of the Act on the same day. From the aforesaid facts the following facts emerged: i) The assessee had filed return of income declaring Rs.50,28,040/-. The ITO issued notice under section 143(2) of the Act on 06.09.2013. ii) The ITO, Ward-1, Haldia taking note that the income returned was above Rs. 15 lacs transferred the case to ACIT, Circle-27, Haldia on 24.09.2014. iii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal in the case of Krishnendu Chowdhury vs. ITO reported in [2017] 78 taxmann.com 89 (Kolkata-Trib.) held as follows:- Return of income of assessee was Rs. 12 lakhs - As per CBDT instruction, jurisdiction for scrutiny assessment vested in Incometax Officer and notice under section 143(2) must be issued by Income-tax Officer, Ward-I, Haldia and none other - But, notice was issued by Asstt. Commissioner, Circle Haldia much after CBDT's instruction and knowing fully well that he had no jurisdiction over assessee - Whether, therefore, notice issued by Asstt. Commissioner was invalid and consequently assessment framed by Income-tax Officers becomes void since issue of notice under section 143(2) was not done by Income-tax Officers as specified in CBDT instruction No. 1/2011. 9.2. The Hon ble High Court of Calcutta in the case of West Bengal State Electricity Board vs. Deputy Commissioner of Income Tax, Special Range I, reported in [2005] 278 ITR 218 (Cal.) has held as follows:- Section 254 of the Income-tax Act, 1961 - Appellate Tribunal - Powers of - Assessment years 1983-84 to 1987-88 - Whether a question of law arising out of facts found by authorities an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e must have emanated from the department. It is only the infirmities in the manner of service of notice that the Section seeks to cure. The Section is not intended to cure complete absence of notice itself. 10. Respectfully following the propositions of law laid down in all these case-law and applying the same to the facts of the case, we hold that the assessment order is bad in law for the reason that the Assessing Officer having jurisdiction over the assessee, has not issued a notice u/s 143(2) of the Act as required by the statute. Notice issue by the officer having no jurisdiction of the assessee is null and void. When a notice is issued by an officer having no jurisdiction, Section 292BB of the Act, does not comes into play. Coming to the argument of the ld. D/R that objection u/s 124(3) of the Act has to be taken by the assessee on rectifying notice u/s 143(2) of the Act from a non-jurisdictional assessing officer, I am of the view that I need not adjudicate this issue, as I have held that non-issual of statutory notice/s 143(2) of the Act by the jurisdictional Assessing Officer makes the assessment bad in law. Under these circumstances, we allow this appeal of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Assessing Officer has been vested with jurisdiction over any area, within the limits of such area, he shall have jurisdiction- (a) in respect of any person carrying on a business or profession, if the place at which he carries on his business or profession is situate within the area, or where his business or profession is carried on in more places than one, if the principal place of his business or profession is situate within the area, and (b) in respect of any other person residing within the area. (2) Where a question arises under this section as to whether an Assessing Officer has jurisdiction to assess any person, the question shall be determined by the [Principal Director General or] Director General or the [Principal Chief Commissioner or] Chief Commissioner or the [Principal Commissioner or] Commissioner; or where the question is one relating to areas within the jurisdiction of different [Principal Director General or] Directors General or [Principal Chief Commissioner or] Chief Commissioners or [Principal Commissioners or] Commissioners by the [Principal Director General or] Director General or the [Principal Chief Commissioners or] Chief Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e above provisions of section 124 would show that in respect of any person carrying on a business or profession, the place of business or profession of the person and in case the business is carried on in more places than one, then the principal place of business would be the deciding factor and territorial jurisdiction will vest in the concerned competent officer of that area. It has been further provided that where a question arises regarding the jurisdiction of an Assessing Officer, the same would be decided by the competent officer as mentioned in sub-section (2) to section 124. Subsection (4) provides that where an assessee calls in question the jurisdiction of an Assessing Officer, then the Assessing Officer shall, if not satisfied with the correctness of the claim, refer the matter for determination to the competent authority as provided under sub-section (2), before the assessment is made. In this case, the return of income was filed by the assessee at the address of Gandhi Dham, Gujarat. The ld. counsel has also invited our attention to paper-book page 112 to show that the assessee had written letter dated 17.12.2014 to the Commissioner of Income Tax-1, Kolkata with a c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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