9911796707
TMI Blog2022 (10) TMI 764X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Rs.2,61,00,000/- (i.e. actual sale consideration) in computing the long term capital gain u/s.48. 3. That the ld. CIT(A) has erred in facts as well as in law, in confirming the action of the ld. AO of not allowing the claim of stamp duty expense of Rs.22,83,000/- in computing the long-term capital gain u/s.48. 4. That the ld. CIT(A) has erred in facts as well as in law, in confirming the action of the ld. AO of not allowing the claim of cost of acquisition and cost of improvement totalling to Rs.30,04,144/- incurred in different years, in computing the long-term capital gain u/s.48. 5. That the ld. CIT(A) has erred in facts as well as in law, in confirming the action of the ld.AO of not allowing the claim of Rs.14,75,197/- u/s.54F made by the assessee. 6. That the ld CIT(A) has erred in facts as well as in law, in not adjudicating the matter regarding the claim of home loan interest of Rs.17,51,509/- u/s.24(b) under the head income from house property, in spite of having all the material on records and referring the matter to the file of the A.O. 7. That the ld. CIT(A) has erred in facts as well as in law, in confirming the action of the ld. AO in increasing house pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3), dated 30.03.2015. It is the claim of the assessee that as the Income-Tax Officer, Ward-2(2), Bhilai pursuant to the CBDT Instruction No.1/2011, dated 31.01.2011 was not vested with the pecuniary jurisdiction over the case of the assessee for the year under consideration i.e AY 2012- 13, therefore, the impugned assessment so framed by him cannot be sustained. As the adjudication of the aforesaid issue involves purely a question of law which would not require looking any further beyond the facts available on record, therefore, we have no hesitation in admitting the same. Our aforesaid view that where an assessee, had raised, though for the first time, an additional ground of appeal before the Tribunal which involves purely a question of law and requires no further verification of facts, then, the same merits admission finds support from the judgment of the Hon'ble Supreme Court in the case of National Thermal Power Company Ltd. Ltd. Vs. CIT (1998) 229 ITR 383 (SC). 7. We have heard the ld. authorized representatives of both the parties, perused the orders of the lower authorities and the material available on record, as well as considered the judicial pronouncements that have be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee, but the assessment thereafter had wrongly been framed by the Income-Tax Officer, Ward-2(2), Bhilai i.e. an officer who pursuant to the aforesaid CBDT Instruction No.1/2011 (supra) was beyond doubt divested of his jurisdiction over the case of the assessee for the year under consideration. It was averred by the Ld. AR that now when the assessment order u/s.143(3), dated 30.03.2015 had been passed by the Income-Tax Officer, Ward-2(2), Bhilai, an officer who was not vested with jurisdiction over the assessee's case for the year under consideration, therefore, the same could not be sustained and was liable to be struck down. The Ld. AR in support of his contention that the assessments not framed in conformity with the CBDT Instruction No.1/2011, dated 31.01.2011 could not be sustained and were liable to be struck down had relied on a host of judicial pronouncements as under: Sr. No. Particulars 1. Anderson Printing House PL (2021)134 taxmann.com 4(Kol-Trib), dated. 28-10-2021 2. Hirak Sarkar (2021) ITA No.850/Kol/2019 (Kol-Trib), dated.12-8-2021 3. Bhagyalaxmi Conclave PL (2021) ITANo.2517/Ko1/2019 (Kol-Trib) dated 03-02-2021 4. Hillman Hosiery Mills PL(2021) ITA No.26 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 03.03.2015 from him. The Ld. AR had in support of his aforesaid contention relied on the judgment of the Hon'ble High Court of Bombay in the case of Peter Vaz Vs. CIT [2021] 128 taxmann.com 180 (Bombay). It was averred by the Ld. AR that the Hon'ble High Court in its aforesaid order while reversing the view taken by the Tribunal had observed that the provisions of Section 124(3) referred mainly to the territorial jurisdiction of the A.O. Also, support was drawn by the Ld. AR from the judgment of the Hon'ble High Court of Gujarat in the case of CIT Vs. Ramesh D Patel (2014) 362 ITR 492 (Guj.). It was submitted by the Ld. AR that the Hon'ble High Court had observed that the provisions of Section 124 of the Act clearly concern the territorial jurisdiction of the Assessing Officer and have no relevance in so far the inherent jurisdiction for passing the assessment order is concerned. It was submitted by the Ld. AR that as in the present case the assessment had been framed by a non-jurisdictional A.O, therefore, the same de hors lack of inherent jurisdiction with the latter was invalid and non-est, and thus, liable to be struck down on the said count itself. 10. Per contra, the Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 be Ahmedabad, Bangalore, Chennai, Delhi, Kolkata, Hyderabad, Mumbai and Pune. The above instructions are issued in supersession of the earlier instructions and shall be applicable with effect from 1-4-2011." (emphasis supplied by us) As stated by the Ld. AR and, rightly so, the CBDT vide its aforesaid Instruction No.1/2011, dated 31.01.2011 had, inter alia, revised the earlier existing monetary limit for assigning the cases to ITOs/ACs/DCs w.e.f. 01.04.2011. On the basis of the aforesaid CBDT Instruction No.1/2011 (supra) w.e.f 01.04.2011, the case of a non-corporate assessee located in a mofussil area having declared an income above Rs.15 lacs in his return of income is to be assigned to the ACs/DCs. As the case of the present assessee for the A.Y.2012-13 was selected for scrutiny assessment vide notice issued u/s.143(2), dated 24.09.2013, therefore, the aforesaid CBDT Instruction No.1/2011, dated 31.01.2011 that was applicable w.e.f. 01.04.2011 duly applied to his case. Also, as per the areas earmarked ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no escape from the same for justifying assumption of jurisdiction by an officer other than that prescribed in the said instruction. Our aforesaid view is fortified by the Judgments of the Hon'ble Supreme Court in the case of UCO Bank Vs. CIT (1999) 237 ITR 889 (SC) and Commissioner of Customs etc. Vs. Indian Oil Corporation Ltd. & Anr. (2004) 267 ITR 272 (SC). In the aforesaid judgments it was held by the Hon'ble Apex Court that though the CBDT/CBEC circulars are not binding on court or the assessee, but the departmental authorities are bound by them and cannot act in contravention of the same. Also, support is drawn from the judgment of the Hon'ble High Court of Chattisgarh in the case of Dy. CIT Vs. Sunita Finlease Ltd. [2011] 330 ITR 491 (Chattisgarh). In its said order it was observed by the Hon'ble Jurisdictional High Court that the administrative instructions issued by CBDT are binding on the Income-tax authorities. On the basis of our aforesaid observations, we are of the considered view that as the framing of the assessment in the case of the present assessee by the Income-Tax Officer, Ward-2(2), Bhilai is clearly found to be in contravention of the CBDT Instruction No.1/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee to raise an objection as regards the validity of the jurisdiction of an A.O would get triggered only in a case where the dispute of the assessee is with respect to the territorial jurisdiction and would have no relevance in so far his inherent jurisdiction for framing the assessment is concerned. Also, support is drawn from a recent judgment of the Hon'ble High Court of Calcutta in the case of Principal Commissioner of Income-tax Vs. Nopany & Sons (2022) 136 taxmann.com 414 (Cal). In the case before the Hon'ble High Court the case of the assessee was transferred from ITO, Ward-3 to ITO, Ward-4 and the impugned order was passed by the ITO, Ward-4 without issuing notice u/s 143(2) and only in pursuance to the notice that was issued by the ITO, Ward-3, who had no jurisdiction over the assessee at the relevant time. Considering the fact that as the assessment was framed on the basis of the notice issued under Sec. 143(2) by the assessing officer who had no jurisdiction to issue the same at the relevant point of time, the Hon'ble High Court quashed the assessment. Apart from that, the aforesaid view is also supported by the order of the ITAT, Kolkata 'B' Bench in the case of OSL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) also subordinate to him, then he is under an obligation to record his reasons for doing so after giving the assessee a reasonable opportunity of being heard in the matter wherever it is possible to do so. For the sake of clarity sub-section (1) of Section 127 is culled out as under: "(1) The [Principal Director General or] Director General or [Principal Chief Commissioner or] Chief Commissioner or [Principal Commissioner or] commissioner may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, transfer any case from one or more Assessing Officers subordinate to him (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) also subordinate to him." On a careful perusal of the aforesaid mandate of law, it transpires, that even in a case where jurisdiction over the case of an assessee that is vested with one A.O (having concurrent jurisdiction over the case of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the earlier orders passed in the case of Hillman Hosiery Mills Pvt.Ltd. Vs. DCIT, ITA No.2634/Kol/2019; Soma Roy Vs. ACIT, ITA No.463/Kol/2019 dated 08.01.2020; and Shri Sukumar Ch. Sahoo Vs. ACIT, ITA No.2073/Kol /2016 dated 27.09.2017, had struck down the assessment for want of valid assumption of jurisdiction by the A.O who had framed the assessment in contravention of the CBDT Instruction No.1/2011, dated 31.01.2011, observing as under: "5. A perusal of the aforesaid statutory provisions would reveal that the jurisdiction of Income Tax Authorities may be fixed not only in respect of territorial area but also I.T.A. No.339/Kol/2021 Assessment Year: 2016-17 Anderson Printing House Pvt. Ltd having regard to a person or classes of persons and income or classes of income also. Therefore, the CBDT having regard to the income as per return has fixed the jurisdiction of the Assessing Officers. The ld. Counsel in this respect has relied upon the CBDT Instruction No.1/2011 [F.No.187/12/2010-IT(A-I), for the sake of convenience is reproduced as under: "Instruction No.1/2011 [F.No.187/12/2010-IT(A-I), DATED 31-1-2011 References have been received by the Board from a large number o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No document has been produced on the file by the Department to show that the case was transferred by the competent authority from Income Tax Officer to ACIT. The notice u/s 143(2) has been issued by ACIT which was beyond his jurisdiction and the same is therefore, void ab initio. Under the circumstances, the assessment framed by ACIT, is bad in law as he did not have any pecuniary jurisdiction to frame the assessment. The issue relating to the pecuniary jurisdiction also came into consideration before the Coordinate Bench of the Tribunal in ITA No.2517/Kol/2019 and Others vide order dated 03.02.2021, wherein the Tribunal further relying upon various other decisions of the Coordinate Benches of the Tribunal has decided the issue in favour of the assessee and held that the assessment framed by Assessing Officer who was not having pecuniary jurisdiction to frame such assessment was bad in law. The relevant part of the order dated 03.02.2021 passed in ITA No.2517/Kol/2019 and Others is reproduced as under: "5.2. The assessee relied on the recent decision of this Tribunal in the case of Hillman Hosiery Mills Pvt. Ltd. vs. DCIT, in ITA No. 2634/Kol/2019, order dated 12.01.2021. We fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ITO as well as the ACIT and hence the assessment cannot be annulled simply because the statutory notice u/s 143(2) of the Act, was issued by the ITO and the assessment was completed by the ACIT. He further submitted that the assessee did not object to the issue of notice before the jurisdictional Assessing Officer and even otherwise, Section 292BB of the Act, comes into play and the assessment cannot be annulled. On merits, he relied on the orders of the lower authorities. 7. I have heard rival contentions. On careful consideration of the facts and circumstances of the case, perusal of the papers on record, orders of the authorities below as well as case law cited, I hold as follows:- 8. I find that there is no dispute in the fact that the notice u/s 143(2) of the Act dt. 29/09/2016 has been issued by the ITO, Wd-1(1), Durgapur. Later, the case was transferred to the jurisdiction of the ACIT on 11/08/2017. Thereafter, no notice u/s 143(2) of the Act was issued by the Assessing Officer having jurisdiction of this case and who had completed the assessment on 26/12/2017 i.e., ACIT, Circle-1(1), Durgapur. Under these circumstances, the question is whether the assessment is bad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n to assess the assessee lies only by AC/DC and not ITO. So, therefore, only the AC/DC had the jurisdiction to assess the assessee. It is settled law that serving of notice u/s. 143(2) of the Act is a sine qua non for an assessment to be made u/s. 143(3) of the Act. In this case, notice u/s. 143(2) of the Act was issued on 06.09.2013 by ITO, Ward-1, Haldia when he did not have the pecuniary jurisdiction to assume jurisdiction and issue notice. Admittedly, when the ITO realized that he did not had the pecuniary jurisdiction to issue notice he duly transferred the file to the ACIT, Circle-27, Haldia on 24.09. 2014 when the ACIT issued statutory notice which was beyond the time limit prescribed for issuance of notice u/s. 143(2) of the Act. We note that the ACIT by assuming the jurisdiction after the time prescribed for issuance of notice u/s. 143(2) of the Act notice became qoarum non judice after the limitation prescribed by the statute was crossed by him. Therefore, the issuance of notice by the ACIT, Circle-27, Haldia after the limitation period for issuance of statutory notice u/s. 143(2) of the Act has set in, goes to the root of the case and makes the notice bad in the eyes of ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
