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TMI Blog2011 (1) TMI 1123X X X X Extracts X X X X X X X X Extracts X X X X ..... r of Income-tax against the two orders passed by the Income-tax Appellate Tribunal. Income-tax Appeal No. 193 of 2000 is against the order passed by the Income-tax Appellate Tribunal, Bench-B Allahabad in I. T. A No. 1689 (Alld)/83 dated December 23, 1999. The appeal before the Tribunal was filed by the assessee, respondent herein. The Tribunal allowed the appeal of the assessee. The Income-tax Appellate Tribunal, Lucknow Bench, Lucknow followed the aforesaid order of the Allahabad Tribunal in I. T. A. No. 1783(Alld) of 1983, in the appeal filed by the Department by its judgement and order dated October 19, 2000. The Tribunal has dismissed the appeal which was preferred before it by the Department. Hence, the appeal No. 21 of 2001. Both the appeals relate to the assessment year 1974-75 and arise out of the same order which was passed by the Commissioner of Income-tax (Appeals). Shorn of unnecessary details, the relevant facts of the purposes of disposal of these two appeals may be noticed in brief:- The respondent, the assessee was carrying on the business of manufacturing woollen textiles and leather goods. It had two woollen units popularly known as Cawnpore W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the merits of the appeal. Subsequent thereto when the appeal of the Department came up for consideration it was dismissed by the order dated October 19, 2000 by following its above order (against which Appeal No. 21 of 2000 has been filed). Appeal No. 193 of 2000 has been admitted on the following two substantial questions of law:- "1. Whether on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that the assessment order made by the Assessing Officer in the case was void ab initio for want of jurisdiction? 2. Whether on the facts and in the circumstances of the case and in view of the provisions of section 124(5)(a) of the Income-tax Act 1961 as they stood on the date of the assessment, i.e., September 7, 1977, the Income-tax Appellate Tribunal was correct in law in holding that the order of the Assessing Officer after the transfer of the case from him whether the authority could not be treated to be a valid order because the Assessing Officer ceased to have jurisdiction over the case?" In the connected Income-tax Appeal No. 21 of 2001, the appeal has been admitted on the following substantial questions o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (f) Order of transfer was effective from July 1, 1977, the assessment order was made by the Income-tax Officer, CC-I Kanpur on September 7, 1977. The Tribunal on the above facts proceeded to decide the question of jurisdiction of the Income-tax Officer, CC-1, Kanpur. The question of jurisdiction was decided by the Commissioner of Income-tax (Appeals) against the assessee on two grounds. Firstly, no such objection was raised by the assessee before the Assessing Officer and, secondly, no such objection in view of the scheme of the Income-tax Act can be entertained by an appellate authority or court. It took the view that the order assigning the file to an Assessing Officer is administrative in nature and while hearing an appeal, it is not open to an appellate authority to examine the question of jurisdiction of the assessing authority. Reliance was placed by him on certain decisions already referred to above. The Tribunal took a different view of the matter on the ground that there is nothing on record to show as to when the transfer order was communicated to the assessee. According to it, there is nothing on record to show that it was communicated on that very date, i. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be disputed after the completion of the assessment proceedings. Alternatively, if such a question arises, the said question can be addressed by the Commissioner or the Board, as the case may be, in view of sub-section (4) of section 124 and this by necessary corollary excludes the jurisdiction of the first appellate authority or the court. In Hindustan Transport Co. v. IAC of I. T. [1991] 189 ITR 326 (All), this court in depth examined the nature of the power of transfer conferred under the Act on the Commissioner. On a depth analysis of section 124 of the Act, it has been held as follows (page 330):- "A survey of the above provisions of the Act highlights the following situations. After creating the various income-tax authorities, the Act does not prescribe their respective jurisdiction or functions. Any case can be dealt with by any income-tax authority with the possible exception of the Board. Accordingly, the various income-tax authorities are of co-ordinate jurisdiction. What function or functions, which authority or officer, shall perform is left to be decided either by the Board or by the Commissioner. On what principles the Board and the Commissioner will all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve in nature. We cannot lose sight of the fact that in the Act it has been specifically provided that the question of jurisdiction of the assessing authority can be gone into either by the Commissioner or by the Board, as the case may be. An appeal to an appellate authority under the Act lies on the grounds as enumerated in section 246 of the Act. None of its clauses shows that an appeal on the question of jurisdiction of the assessing authority is maintainable. The Tribunal has failed to appreciate the above legal aspects as contained in section 124 of the Act although these aspects were highlighted by the first appellate authority in its order. It has not come on record, not disclosed by the assessee at least, even before the first appellate authority in the additional memo of appeal as to when he got the knowledge of the transfer order dated July 1, 1977. The observation of the Tribunal that it is admitted that the order of transfer order is effective from July 1, 1977 is therefore, uncalled for. It has misdirected itself. The Tribunal has proceeded on a wrong footing that in the absence of date of communication of the order to the assessee, the assessee could raise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and such a judgment and decree cannot be set aside by higher court while exercising appellate or revisional jurisdiction unless a prejudice which has been caused to the appellant is established. Prejudice can be a ground for relief only when it is due to the action of another party and not when it results from one's own act. Courts cannot recognise that as prejudice which flows from the action of the very party who complains about it. (Kiran Singh v. Chaman Paswan, AIR 1954 SC 340). The case on hand stands still on a weak footing inasmuch as the Income-tax Officer, CC-I had the jurisdiction when the assessment proceedings commenced and a draft assessment order was submitted to the Inspecting Assistant Commissioner. Subsequent change in the jurisdiction if any unless brought to the notice of the authority concerned, will not in any manner vitiate the assessment order in the absence of any objection with regard to lack of jurisdiction by the assessee. It is a case where both the Assessing Officer and the assessee proceeded as if there is no transfer order transferring jurisdiction. There is one more flaw in the order of the Tribunal. The Tribunal at the most should have remi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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