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2017 (10) TMI 48 - AT - Income TaxLack of jurisdiction of the Assessing Officer in passing the assessment order - stand of the Department that jurisdiction of the Assessing Officer changes when PAN is transferred - Held that - In the present case, the jurisdiction is transferred by Commissioner of Income Tax-3, Mumbai on 19-12-2014. The copy of order transferring jurisdiction was sent to the DCIT 3(1)(1), Mumbai and to other concerned officials but not to ITO 3(1)(3) who passed assessment order in the case of assessee. If the information given in jurisdiction history details available on official website of the Department is co-related with the order of Commissioner of Income Tax-3, Mumbai, it would be clearly evident that even on 19-12-2014 the Assessing Officer who passed the assessment order had no jurisdiction over the file of assessee. Even if it is presumed that he had concurrent jurisdiction, he ceases to have jurisdiction after passing of the order by Commissioner of Income Tax-3, Mumbai on 19-12-2014, transferring the jurisdiction from Circle 3(1)(3), Mumbai to Circle 1(1), Pune. Transfer of PAN on 29-12-2014 is consequential to the order transferring jurisdiction. The PAN follows the jurisdiction. It is not the jurisdiction that follows the PAN. The effective date of transfer of jurisdiction is the date of order passed by Commissioner of Income Tax and not the transfer of PAN. Any order or decree passed by any court or quasi judicial authority without jurisdiction is a nullity. A defect of jurisdiction, whether it is pecuniary or territorial strikes at the very authority of court passing such order. The defect in jurisdiction is an incurable defect which cannot be cured by consent of both the parties to lis. In the present case the effective date of transfer of jurisdiction is 19-12-2014 i.e. the date of order by Commissioner of Income Tax-3, Mumbai transferring the jurisdiction. The assessment order passed by the Assessing Officer at Mumbai on 24-12-2014 i.e. after the date of transfer of jurisdiction, hence it suffers from lack of jurisdiction and hence, is null and void. - Decided in favour of assessee.
Issues Involved:
1. Jurisdiction of the Assessing Officer. 2. Validity of the assessment order. 3. Transfer of jurisdiction and its effective date. 4. Competence of the Tribunal to entertain jurisdiction issues not raised before the Assessing Officer. Issue-wise Detailed Analysis: 1. Jurisdiction of the Assessing Officer: The primary issue raised by the assessee was the jurisdiction of the Assessing Officer (AO) in passing the assessment order dated 24-12-2014. The assessee argued that the jurisdiction had been transferred from Mumbai to Pune on 14-11-2014, as per the communication dated 19-12-2014, and thus, the AO in Mumbai lacked the authority to pass the assessment order. The Department contended that the jurisdiction was transferred after the assessment order was passed and that the Tribunal lacked the competence to entertain jurisdiction issues not raised before the AO. 2. Validity of the Assessment Order: The assessee challenged the validity of the assessment order on the grounds that it was passed by an officer who no longer had jurisdiction over the case. The Tribunal examined the sequence of events and documents, including the order dated 14-11-2014 by the Principal Chief Commissioner of Income Tax, Mumbai, and the subsequent communication on 19-12-2014, which indicated the transfer of jurisdiction. The Tribunal concluded that the AO in Mumbai ceased to have jurisdiction over the assessee’s case after the order dated 19-12-2014, making the assessment order dated 24-12-2014 null and void. 3. Transfer of Jurisdiction and Its Effective Date: The Tribunal emphasized that the effective date of transfer of jurisdiction is the date of the order passed by the competent authority, not the date when the PAN is transferred. The Tribunal referred to the jurisdiction history details from the official website of the Department, which showed that the PAN was transferred from Ward 3(1)(3), Mumbai to Circle 3(1)(1), Mumbai on 18-12-2014, and subsequently to Circle 1(1), Pune on 29-12-2014. The Tribunal held that the AO in Mumbai lost jurisdiction over the case on 19-12-2014, the date of the order by the Commissioner of Income Tax-3, Mumbai, transferring the jurisdiction. 4. Competence of the Tribunal to Entertain Jurisdiction Issues Not Raised Before the Assessing Officer: The Department argued that the Tribunal could not adjudicate on the jurisdiction issue as it was not raised before the AO. The Tribunal rejected this argument, distinguishing the present case from the cited case laws, which dealt with jurisdiction under section 124 of the Act. The Tribunal noted that the jurisdiction in the present case was transferred under section 127 r.w.s. 120 of the Act, and thus, the objection raised by the Department was unsustainable. Conclusion: The Tribunal concluded that the assessment order dated 24-12-2014 was null and void due to lack of jurisdiction, as the AO in Mumbai had no authority to pass the order after the jurisdiction was transferred to Pune on 19-12-2014. The appeal of the assessee was allowed on the ground of jurisdiction alone. The Tribunal’s decision underscored the importance of proper jurisdiction in the validity of assessment orders and the effective date of jurisdiction transfer being the date of the order by the competent authority.
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