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2024 (5) TMI 863 - HC - Income TaxAO jurisdiction to pass the assessment order - file was transferred to ACIT, Central Circle 2(3), Chennai pursuant to an order passed by the CIT u/s 127 - HELD THAT - As evidently clear that on and after the order passed by the CIT transferring the files to the jurisdiction at Chennai by order dated 15.03.2013, the Assessing Officer here in Kolkata has no jurisdiction to deal with the matter. This aspect has been rightly noted by the learned Tribunal. The learned Tribunal also took note of the decision of Ramshila Enterprises Private Limited 2016 (5) TMI 17 - CALCUTTA HIGH COURT In the said decision, the Court took note of the judgment of the Pandurang Ors. Versus State of Maharashtra 1986 (9) TMI 415 - SUPREME COURT for the proposition that even a right order by a wrong forum is a nullity. Reference was also made to the decision of Ashoke Glass Works 1979 (7) TMI 28 - CALCUTTA HIGH COURT wherein it was held that when the jurisdiction is validly removed by a competent authority under the provisions of a statute, the original court or any Tribunal or authority in such event will be incompetent, as having ceased to have jurisdiction, to proceed further with the pending proceeding or proceeding which may be instituted after such removal of jurisdiction. Tribunal has examined the facts and has found that on the date when the AO completed the assessment, he had no jurisdiction over the matter. Advocate appearing for the respondent assessee placed reliance on the decision of the Division Bench of High Court of Judicature at Bombay in The Pr. Commissioner of Income Tax-1, Pune Versus M/s Capstone Securities Analysis Pvt. Ltd. 2022 (12) TMI 1428 - BOMBAY HIGH COURT . In the said case, the factual position is more or less identical to that of the case on hand. In the said case, it was contended by the Revenue that the Assessing Officer would continue to exercise jurisdiction in the case of the assessee in as much as the PAN of the assessee came to be transferred only subsequently. This argument was rejected by the Division Bench and held that the transfer of PAN is consequential to the transfer of jurisdiction and it is the PAN which follows the jurisdiction and not vice versa. Revenue has canvassed that the files as well as the PAN was still lying within the jurisdiction of the Income Tax Officer Ward 1(4) Kolkata. The transfer of the files is a ministerial or an administrative act to be done by the department for which the assessee cannot be held responsible. That apart, the transfer of the PAN was only a consequential proceeding to the transfer of jurisdiction and therefore the same cannot be a ground to hold that the AO had jurisdiction over the matter despite the order of transfer passed by the Commissioner on 15.03.2013.
Issues involved:
The appeal filed by the Revenue under Section 260A of the Income Tax Act, 1961 against an order passed by the Income Tax Appellate Tribunal, "B" Bench, Kolkata for the Assessment Year 2008-09. Issue A: The Revenue questioned whether the assessment order under Section 147/143 (3)/263/144 dated 24.03.2014 was valid, as the Assessing Officer's jurisdiction was transferred to Chennai. The Revenue argued that the assessee did not cooperate in the assessment proceedings, and the assessment was completed based on available facts and legal precedents. The assessee did not raise jurisdictional issues earlier, and the Tribunal's decision favored the assessee without considering their conduct. Issue B: The question was raised regarding the jurisdiction of the Assessing Officer after the transfer of files under Section 127 of the Income Tax Act to Chennai. The assessee contended that the notices issued were without jurisdiction due to the transfer of jurisdiction to Chennai. The jurisdictional point was raised before the CIT(A), but it was not properly appreciated. The Tribunal found that the Assessing Officer in Kolkata had no jurisdiction after the transfer to Chennai, citing legal precedents. The Tribunal considered the facts and legal principles, concluding that the Assessing Officer lacked jurisdiction over the matter. The Tribunal referenced relevant case law to support its decision. The Division Bench of the Bombay High Court rejected the Revenue's argument that jurisdiction continued based on PAN transfer, emphasizing that jurisdiction follows the PAN, not vice versa. The Revenue's argument that the PAN and files were still within Kolkata's jurisdiction was dismissed, as the transfer of jurisdiction was a consequential proceeding. The Tribunal's decision was upheld, and the appeal failed against the Revenue.
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