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2019 (4) TMI 510 - AT - Income TaxPower of Addl. CIT to pass assessment order - Jurisdiction of Addl. CIT to act as an AO - absence of a valid order u/s 120(4)(b) as well as section 127(1) - admission of Additional Ground - HELD THAT - We follow the decision of the Tribunal in Tata Sons Ltd. 2016 (10) TMI 1228 - ITAT MUMBAI and hold that in the facts of the present case, the Addl. CIT in the absence of a valid order u/s 120(4)(b) as well as section 127(1) of the Act could not have exercised powers of an Assessing Officer to pass the impugned assessment order. Accordingly, the impugned assessment order is annulled/quashed.
Issues Involved:
1. Jurisdiction and authority of the Additional Commissioner of Income Tax (Addl. CIT) to pass the assessment order. 2. Validity of the assessment order under section 143(3) of the Income Tax Act, 1961. Detailed Analysis: 1. Jurisdiction and Authority of Addl. CIT: The assessee raised an additional ground of appeal challenging the jurisdiction and authority of the Addl. CIT to pass the assessment order dated 31.12.2007. The key arguments were: - The Addl. CIT lacked legal and valid jurisdiction under section 120(4)(b) of the Income Tax Act to pass the order. - The Addl. CIT can only perform functions and exercise powers of an Assessing Officer if specifically directed under section 120(4)(b) of the Act. - The assessment should be completed by the authority who initiated the proceedings unless there is a proper order of transfer under section 127(1) or 127(2) of the Act. The Tribunal admitted the additional grounds of appeal, emphasizing that jurisdictional issues can be raised at any stage as they go to the root of the matter. The Tribunal referenced several precedents, including Tata Sons Ltd. v. ACIT and Tata Communication Ltd. v. Addl. CIT, which supported the assessee's contention that the assessment order must be passed by an officer with proper jurisdiction. 2. Validity of the Assessment Order: The Tribunal examined whether the Addl. CIT had the authority to act as an Assessing Officer and pass the impugned assessment order. The Revenue argued that the term "Assessing Officer" includes Addl. CIT as per various sections of the Income Tax Act and notifications issued by the CBDT. However, the Tribunal found that: - The Addl. CIT was not specifically authorized under section 120(4)(b) or section 127 to act as an Assessing Officer for the assessee. - The Tribunal cited the case of Tata Sons Ltd., where it was held that an assessment order passed without proper jurisdiction is null and void. - The Tribunal noted that the definition of "Assessing Officer" did not include "Additional Commissioner" until the Finance Act, 2007, which was not applicable retrospectively to the period in question. The Tribunal concluded that the Addl. CIT did not have the requisite authority to pass the assessment order and that the order was void ab initio. Consequently, the assessment order was annulled/quashed. Conclusion: The Tribunal allowed the appeal filed by the assessee, holding that the assessment order passed by the Addl. CIT was without jurisdiction and therefore invalid. The appeal filed by the Revenue was dismissed as it did not survive following the annulment of the assessment order. Order Pronounced: The order was pronounced in the open Court on 11/03/2019.
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