TMI Blog2023 (1) TMI 958X X X X Extracts X X X X X X X X Extracts X X X X ..... he present appeal has been preferred by the assessee against the order dated 26.04.2019 of the Commissioner of Income Tax (Appeals)-2, Ludhiana [hereinafter referred to as 'CIT(A)'] passed u/s. 250 of the Income Tax Act (hereinafter referred to as the 'Act'). 2. The assessee in this appeal has taken following grounds of appeal:- 1. That the ld. CIT(A) has grossly erred to hold that even when the returned income was well below Rs. 35 lacs, the DCIT Circle Khanna, was still competent to hold jurisdiction in this case, contrary to CBDT instructions in vogue prescribing limit of Rs. 35 lacs for the AC/DCIT to assume jurisdiction for assessment. 2. That the assessee's declaration before AO that he was only a name lender and the real of the liquor business run in his name, were some other persons named by him, the authorities below grossly erred in not seriously probing the matter to arrive at a logical conclusion by simply resting the entire onus on assessee, ignoring the assessee's poor financial and social status 3. That the ld. CIT(A), even while deleting the addition of Rs. 1,50,000,00/-, as not pertaining to this year, was not justified in s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, Chandigarh passed in pursuance Notification No. 50 dated 22.10.2015 published in the Gazette of India Extraordinary (SO No. 2751(E), addressed to the Chief Commissioner of Income Tax Shimla/Panchkula/Ludhiana and Amritsar. 5. The Ld. counsel has further invited our attention to the return of income filed by the assessee to submit that the income returned by the assessee was at Rs. 16,95,280/- which was less than Rs. 35 lacs and further the return of income was filed on 21.01.2014, whereas, the notice was issued u/s. 143(2) of the Act to the assessee on 2.9.2014 and whereas the assessment order was passed on 31.3.2016.. The Ld. Counsel, therefore, has submitted that the jurisdiction to frame the assessment in this case at that time lied with the concerned Income Tax Officer and not with the DCIT. 6. The Ld. DR, on the other hand, has submitted that there was no such monetary limit prescribed. The aforesaid notification/letter was issued for internal/administrative purpose of the Department and the same did not give rise to the any legal right to the assessee to object regarding the pecuniary jurisdiction to the Assessing officer. That even as per the said notification/let ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssue orders in writing for the exercise of the powers and performance of the functions by all or any of the other income- tax authorities who are subordinate to it. (3) In issuing the directions or orders referred to in sub-sections (1) and (2), the Board or other income- tax authority authorised by it may have regard to any one or more of the following criteria, namely:- (a) territorial area; (b) persons or classes of persons; (c) incomes or classes of income; and (d) cases or classes of cases ...... 10. 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 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. 11. At this stage reference can be made to the copy of the order dated 31.10.2014 bearing F. No. Pr. CCIT/Chd/Tech./2014-15/4595-96, issued by the Pr. Chief Commissioner of Income Tax, N.W. Region, Chandigarh passed in pursuance Notification No. 50 dated 22.10.2014 published in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssue 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 non-corporate 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 had no jurisdiction of the case. He submitted that the assessment order was passed by the ACIT, Circle-1(1), Durgapur, who had the jurisdiction over the assessee, but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o 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) On 24.09.2014 statutory notices for scrutiny were issued by ACIT, Circle-27, Haldia. 6. We note that the CBDT Instruction is dated 31.01.2011 and the assessee ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lakhs - As per CBDT instruction, jurisdiction for scrutiny assessment vested in Income-tax 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 and which went to root of jurisdiction can be raised for first time before Tribunal - Held, yes Whether jurisdiction of Assessing Authority is not dependent on date of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 assessee. 6. Respectfully following the propositions of law laid down in these orders stated above, we hold that the orders are bad in law for the reason that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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