2024 (5) TMI 1102 - AT - Income Tax

Assessment order u/s 147 - assessment having framed by the incorrect AO - assessee submitted before us that the assessment has been framed by the AO without any jurisdiction as notice u/s 148 of the Act as well as notice 143(2) of the Act were issued by ITO, Ward-61(4), Kolkata whereas the assessment was framed by ITO, Ward-6(1), Kolkata. HELD THAT - We find that the assessee has filed the return of income with AC, Range-24, Kolkata whereas the notice u/s 148 of the Act dated 31.03.2017 and 143(2) of the Act dated 6.7.2017 were issued by ITO, Ward-61(4), Kolkata. We note that the assessee objected to the jurisdiction of the AO who issued the said notices vide letter dated 1.4.2017 and considering the assessee s request, the case was transferred to ITO, Ward-6(1), Kolkata and the assessment was framed accordingly. Now the question before us whether the assessment so framed by ITO, Ward-6(1), Kolkata is invalid. In view of the fact that notice u/s 148 as well as 143(2) of the Act were issued by ITO, Ward 61(4), Kolkata. We are inclined to hold that the order framed by ITO, Ward-6(1), Kolkata without issuing any notices u/s 148 of the Act as well as u/s 143(2) of the Act when the officers have sufficient time to issue the notices when the assessee raised objections of jurisdiction is apparently without jurisdiction and is accordingly quashed. Appeals of the assessee are allowed.

Summary

Issues Involved:
1. Validity of assessment order u/s 147/143(3) due to lack of jurisdiction.
2. Validity of assessment order due to non-issuance of notice u/s 148 and 143(2) by the correct AO.

Summary:

Issue 1: Validity of assessment order u/s 147/143(3) due to lack of jurisdiction

The assessee filed a return of income with ACIT, Range-24, Kolkata, but the assessment was reopened u/s 147 by issuing a notice u/s 148 by ITO, Ward-61(4), Kolkata, who lacked jurisdiction. The notice u/s 143(2) was also issued by the same ITO. The assessee objected to this jurisdictional issue, leading to the transfer of the case to ITO, Ward-6(1), Kolkata, who framed the assessment. The Tribunal found that the assessment framed by ITO, Ward-6(1), Kolkata, was invalid as the initial notices were issued by an officer without jurisdiction. The Tribunal relied on several decisions of the Hon'ble Calcutta High Court, including PCIT vs. Mohan Chand Motilal, PCIT vs. Nopani & Sons, and others, which upheld that assessments made without proper jurisdiction are invalid.

Issue 2: Validity of assessment order due to non-issuance of notice u/s 148 and 143(2) by the correct AO

For the AY 2015-16, the assessee filed a return of income, and the case was selected for scrutiny. A notice u/s 143(2) was issued by ITO, Ward-61(4), Kolkata, who lacked jurisdiction. The assessee objected, and the case was transferred to ITO, Ward-6(1), Kolkata, who framed the assessment without issuing any notice. The Tribunal quashed the assessment order, citing the same jurisdictional issues as in the previous case, and held that the assessment was invalid due to the non-issuance of notices by the correct AO.

Conclusion:

The Tribunal quashed both assessment orders for AY 2010-11 and 2015-16 due to lack of jurisdiction and non-issuance of proper notices by the correct AO. The appeals of the assessee were allowed on these legal grounds, leaving the merits open for future adjudication if necessary.