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TMI Blog1998 (11) TMI 61X X X X Extracts X X X X X X X X Extracts X X X X ..... tsar. He claims to have filed returns for the asst. yrs. 1980-81 to 1992-93 with the ITO, Amritsar. In July, 1984, during the asst. yr. 1985-86, he started his profession at 17, West Patel Nagar, New Delhi, in rented premises. However, he continued to file his return of income at Amritsar. No return of income has been filed for the asst. yr. 1993-94 onwards. Mrs. Uma Loomba is an individual having tuition income at Amritsar since the asst. yr. 1982-83. With effect from 4th July, 1984, relevant to the asst. yr. 1985-86, she started her independent proprietary business at Delhi under the name and style of Loomba Clinic Laboratory and Genetic Centre. According to her, returns of income for the years 1982-83 to 1992-93 have been filed with the ITO, Amritsar. No return of income has been filed for the asst. yr. 1993-94 onwards. On 18th July, 1989, and 8th Feb., 1990, search and seizure operations within the meaning of s. 132(1) of the Act were carried out by the DI (Investigation) Delhi, upon both the petitioners. Based on such search and seizure operations, the Asstt. CIT, Investigation Circle 11(1), New Delhi, issued notices under s. 148 of the Act in February, 1993, for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed of making an order under s. 127 for transferring the jurisdiction over these two assessees from Amritsar to Delhi even though they had been filing their IT returns at Amritsar. Actually, it was incumbent upon the two assessees themselves to file their returns at Delhi once they had shifted their business/ profession from Amritsar to this place. Filing of returns at Amritsar does not in anyway alter the correct position of jurisdiction. The assessees have regularly filed their returns at Amritsar, which is their fault and the Department could not be blamed for that. The AO therefore, directed to make the assessments on the two assessees as he is legally holding jurisdiction over them. Here itself we would like to make it clear that the finding of fact recorded by the CIT in his order under s. 124(2) dt. 21st March, 1997, is that both the petitioners had shifted their business and profession to New Delhi after they had closed their business/profession at Amritsar. Exercising writ jurisdiction we will not enter into disputed questions of fact. At the same time we see no reason to doubt the correctness of the facts and the finding recorded by the CIT in his order dt. 21st March, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l or any of the powers and perform all or any of the functions conferred on, or, as the case may be, assigned to such authorities by or under this Act in accordance with such directions as the Board may issue for the exercise of the powers and performance of the functions by all or any of those authorities. (2) The directions of the Board under sub-s. (1) may authorise any other IT authority to issue orders in writing for the exercise of the powers and performance of the functions by all or any of the other IT authorities who are subordinate to it. (3) In issuing the directions or orders referred to in sub-ss. (1) and (2), the Board or other IT authority authorised by it may have regard to any one or more of the following criteria, namely : (a) territorial area ; (b) persons or classes of persons; (c) incomes or classes of income ; and (d) cases or classes of cases. 124. Jurisdiction of AOs.---(1) Where by virtue of any direction or order issued under sub-s. (1) or sub-s. (2) of s. 120, the AO has been vested with jurisdiction over any area, within the limits of such area, he shall have jurisdiction--- (a) in respect of any person carrying on a business or p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, straightaway proceed to refer to the decisions. 7. In Bidi Supply Co. vs. Union of India (1956) 29 ITR 717 (SC) : TC 69R. 605, the Constitution Bench has held that the notice and the return are to be confined to a particular assessment year and what is contemplated is the transfer of such a case , i.e., the assessment case for a particular year. 8. In Pannalal Binjraj vs. Union of India AIR 1957 SC 397 their Lordships have vide para. 20 analysed the scheme of the provisions in the IT Act relating to jurisdiction and transfer of cases. Their Lordships have held that an assessee is entitled to be assessed by the ITO of the particular area where he resides and carries on his business. If a question may arise as to the place of assessment it is to be determined by the CIT. The principles underlying determination of jurisdiction on which the provisions are based are : (i) convenience of the assessee, and (ii) efficiency of the Department (i.e. the exigencies of tax collection). Both the ends would be achieved by conferring jurisdiction on the AO of an area where the assessee to have his assessment at a place but determines the ITO who is to have power to assess him. Vide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e filed the return under protest. The question of jurisdiction arose. Their Lordships opined that the contention of the assessee was without foundation. Now the place where an assessment is to be made pursuant to a notice under s. 22(2) has to be determined under s.64. Indeed that is the only provision in the Act for deciding the proper place for any assessment. There is nothing which makes s. 64 inapplicable to an assessment made under s. 34. Therefore, it seems to us clear, that the place where an assessment under s. 34 can be made has to be decided under s. 64. Now the appellant was not carrying on any business, profession or vocation. He was working as the Defence Minister of the Government of India and residing in Delhi. He could be properly assessed by the Income-tax Officer, Delhi, under s. 64(2) if the assessment was the original assessment. This is not in dispute. It follows that no objection can legitimately be taken by the appellant to his assessment under s. 34 by the ITO, Delhi. Their Lordships applied the test who could properly assess the assessee if the assessment was the original assessment ? It was held that the ITO, Delhi, could have made the original as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The Tribunal was, therefore, correct in holding that the legality of the assessment should be determined on a harmonious reading of s. 124(4) and s. 124(7) and that unless the assessment could be said to be outside the purview of even s. 124(7) it could not be said to be invalid merely because the ITO failed to make a reference and get the jurisdiction determined within the time outlined by s. 124(4) ....... If a case falls under s. 124(4) then the question of jurisdiction can be resolved only in the manner outlined in that section and it cannot be challenged before or decided by the appellate authorities. If the assessment can be supported under s. 124(7), the provisions of s. 124(4) will not apply and there is nothing to bar the jurisdiction of the appellate authorities to uphold the assessment on that ground. In such a case, there is no conflict between the procedure outlined in sub-ss. (4) and (6) and the appellate powers of the AAC and the Tribunal. Sec. 124(7) is very limited in its operation. All that it saves is an assessment made by an ITO (whether he has or not jurisdiction otherwise) provided that the assessment does not bring to tax anything other than income ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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