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TMI Blog1995 (6) TMI 73X X X X Extracts X X X X X X X X Extracts X X X X ..... d also filed his return for that year on 29-6-1987 with the ITO, B-Ward, Bharatpur. The assessment in the case of the assessee was made on 29-1-1988 under section 143(1) of the Income-tax Act, 1961 (the Act) at the income of Rs. 65,990 but the assessment in the case of the dissolved firm remained pending. 4. On 29-6-1987, the assessee, as Sole Proprietor of M/s Surajmal Ramniwas, filed before the ITO, Bharatpur, the return of his income for assessment year 1988-89 at Rs. 1,01,070. 5. On 29-4-1988, the Chief Commissioner of Income-tax for Rajasthan and Madhya Pradesh (CCI, Jaipur) in exercise of his powers under section 120 of the Act, issued Notification No. 16 of 1988-89 whereby he directed, inter alia, that the AC, Circle-III(1), Jaipur shall perform the function of an Assessing Officer in respect of (i) all persons assessable, inter alia, by the ITO, Bharatpur, whose return of income as on 1st of April of any subsequent financial year showed total income/loss of Rs. 2 lacs and above, but below Rs. 5 lakhs and (ii) all persons assessable by, inter alia, ITO, Bharatpur, where no return had been filed by the assessee for any assessment year. This order was made effective from 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of assessee's transferred case for assessment year 1988-89 and completed the assessment on 29-3-1989 determining assessee's total income at Rs. 4,07,249. The assessee appealed to the CIT(A). 8. In appeal before the CIT(A) the assessee, inter alia, challenged the jurisdiction of the ACIT to make the assessment. In this behalf, it was contended that by virtue of the Notification No. 16 issued by the CCI, Jaipur on 29-4-1988 under section 120 that the ACIT could have performed the function of an Assessing Officer in respect of such persons only as were assessable by ITO, Bharatpur but whose returns of income as on 1st April, of any subsequent financial year showed total income/loss of Rs. 2 lakhs and above but below Rs. 5 lakhs, that the assessee had already filed his return on 29-6-1987 with ITO, Bharatpur and such return showed assessee's income below Rs. 2 lakhs and the ACIT could have not performed the functions of an Assessing Officer in respect thereto and that the assessee, in reply to ACIT's notice under section 139(2) had raised objection against ACIT's assuming jurisdiction in the case of the assessee. The learned CIT(A) called for the comments from the ACIT on the objecti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oned by the relevant statute cannot be conferred by the consent of the parties. The fundamental principle in this behalf is that jurisdiction can neither be waived nor conferred by the consent of the parties. If the provisions in the relevant statute do not confer jurisdiction upon a person to do an act in respect of a place, person or subject-matter, it would be a case of inherent lack of jurisdiction. Such lack of jurisdiction in a person would render the order made or proceedings taken or decision given by him as nullity or coram non judice. The very absence of the condition necessary to have jurisdiction to make an order or to take a proceeding or give a decision would deprive the order made, proceedings taken or decision given by him of any conclusive legal effect. 12. The want of jurisdiction should, however, not be confused for irregular or erroneous exercise of jurisdiction. Lack of jurisdiction must be distinguished from irregular or erroneous exercise of jurisdiction. Irregular or erroneous exercise of jurisdiction would fall within the purview of the provisions regulating the procedure for the exercise of the jurisdiction. In such cases, the inherent jurisdiction to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 124(1) or (2), regard may be had to territorial areas, persons or class of persons, incomes or class of incomes and cases or class of cases. 15. Section 124, which is relevant for our purpose, provides that : " 124. (1) Where by virtue of any direction or order issued under sub- section (1) or sub-section (2) of section 120, the Assessing Officer has been vested with jurisdiction over any area, within the limits of such area, be shall have jurisdiction--- (a) in respect of any person carrying on a business or profession, if the place at which he carries on his business or profession is situate within the area, or where his business or profession is carried on in more places than one, if the principal place of his business or profession is situate within the area, and (b) in respect of any other person residing within the area. (2) Where a question arises under this section as to whether an Assessing Officer has jurisdiction to assess any person, the question shall be determined by the Director General or the Chief Commissioner or the Commissioner ; or where the question is one relating to areas within the jurisdiction of different Directors General or Chief Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessing Officer, in the event of his non-satisfaction with the correctness of assessee's objection, to refer the dispute for determination by the higher authority as mentioned in sub-section (2). 17. Sub-section (5) of section 124 starts with a non obstante clause and is intended to serve as a saving provision against the technical objections and disputes that may arise under sub-sections (2) to (4). It is in the nature of a safety value whereby the validity of the assessment is protected notwithstanding an error in the exercise of jurisdiction in accordance with the earlier sub-sections, if there has been no injustice to the assessee and he has been assessed only by an officer who is having jurisdiction over the area in which the assessee resides or carries on business and that too only in respect of income falling within the area covered by that jurisdiction. Thus, though the scope of sub-section (5) is quite limited, but its purpose is quite significant. It is essentially a provision of clarificatory nature and serves as an explanation to the earlier provisions regarding jurisdiction. It needs to be appreciated that no assessee can claim a basic right of being assessed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f substitution of the old section 124 by the Direct Tax Laws (Amendment) Act, 1987 with effect from 1-4-1988, more so to the present case pertaining to assessment year 1988-89. It protects the validity of assessments against errors in exercise of jurisdiction in accordance with the earlier sub-sections if there has been no injustice to the assessee and he has been assessed only by an officer having jurisdiction over the area in which the assessee resides or carries on his business. Sub-section (3) prescribes the time limit for raising objection by the assessee against jurisdiction and even if the Assessing Officer does not feel satisfied with the correctness of his objection and despite that does not act in accordance with the provisions contained in sub-section (4), the assessment made by him if otherwise valid, would be saved by sub-section (5) if no injustice has been caused to the assessee. In view of the specific time limit prescribed in sub-section (3) for raising objections against jurisdiction, such an objection after the expiry of the time limit cannot be raised at a later stage including the appellate stage [Vide Hindustan Transport Co. v. IAC [1991] 189 ITR 326 (All.)]. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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