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TMI Blog2019 (4) TMI 1364X X X X Extracts X X X X X X X X Extracts X X X X ..... d failed to issue a notice u/s. 143(2) within the stipulated time period, therefore, the assessment framed by him under Sec.143 (3), san issuance of the aforesaid notice is absolutely bereft of any force of law and cannot be sustained. Our aforesaid view that a valid assessment under Sec. 143(3) presupposes issuance of a notice under Sec.143(2) finds support from the judgement of the Hon ble Supreme Court in the case of ACIT Anr. Vs. Hotel Blue Moon [ 2010 (2) TMI 1 - SUPREME COURT OF INDIA] as held the omission on the part of the assessing officer to issue notice under Sec.143(2) cannot be held to be merely a procedural irregularity, as the same goes to the very validity of assumption of jurisdiction by the A.O and is not curable. A.O exercising the jurisdiction over the case of the assessee had failed to issue a notice u/s. 143(2) within the specified time period, thus the consequential assessment framed under Sec.143(3) by him cannot be sustained - Decided in favour of assessee - ITA Nos. 183 And 526/Asr./2017 - - - Dated:- 15-1-2019 - Shri N.K. Saini, Vice President And Shri Ravish Sood, Judicial Member For the Appellant : Shri Nirmal Mahajan, A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee that the jurisdiction in its case remained with the A.O, Range-IV, Jalandhar. Subsequently, the assessee was in receipt of a notice under Sec.142(1), dated 15.04.2014 from the office of the ACIT, Circle-1, Jalandhar. In response, the assessee objected to the aforesaid notice issued under Sec.142(1) and submitted that the jurisdiction in his case remained with the Assessing Officer, Circle-IV, Jalandhar. The assessee also brought to the notice of the A.O that it had earlier in the month of September, 2013 in its reply to the notice received from the office of the DCIT, Circle-1, Jalandhar had objected to the invalid assumption of jurisdiction by his office. However, the assessee thereafter was in receipt of another notice under Sec. 143(2), dated 25.05.2014 from the ACIT, Circle-1, Jalandhar. Again the assessee by his reply dated 17.05.2014 (Page 25 of APB ) objected to the validity of the aforementioned notice in the absence of valid assumption of jurisdiction. Finally, a notice under Sec. 143(2), dated 28.05.2014 was issued by the DCIT, Circle-IV, Jalandhar, wherein the latter called upon the assessee to attend his office in respect of certain points in connecti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid deliberations, it was observed by the CIT(A) that no infirmity did emerge from the notice that was issued by the Dy. CIT/ACIT, Circle-1, Jalandhar under Sec.143(2) well within the stipulated time period. Insofar, the support taken by the assessee from the assessment order passed by the ACIT-Circle-IV in its case for A.Y. 2006-07, it was observed by the CIT(A) that pursuant to the electronic system of filing of Income tax returns the jurisdiction over the case of the assessee was vested with the ACIT, Circle-1, Jalandhar. Further, it was observed by him that pursuant to taking up of the issue as regards the jurisdiction over its case by the assessee, the case records would have been transferred to the ACIT/DCIT, Circle-IV, Jalandhar. The CIT(A) also observed that the assessee had not raised any objections in the course of the assessment proceedings and had furnished complete details with the A.O. Apart therefrom, the CIT(A) held a conviction that the provisions of Sec.292B of the I.T. Act would provide a cushion to the A.O for such instances. On the basis of his aforesaid deliberations, the contentions advanced by the assessee as regards the validity of the juri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A No. 669/Del/2012 6. Umacharan shaw Bros Vs. Commissioner of Income Tax (1959) 37 ITR 271 (SC) 7. Per contra, the Ld. Departmental Representative (for short D.R ) relied on the order passed by the CIT(A). 8. We have heard the authorized representatives for both the parties, perused the orders of the lower authorities and the material available on record. We shall first advert to the contentions advanced by the ld. A.R as regards the validity of the jurisdiction assumed by the A.O for framing of the assessment under Sec.143(3) of the I.T. Act. Admittedly, on a perusal of the records it stands revealed that the notice u/s 143(2), dated 23.09.2013 and notice u/s 143(2), dated 28.05.2015 were issued by the ACIT Circle-1, Jalandhar. Apart therefrom, the assessee in its reply to the aforementioned notices had objected to validity of the jurisdiction assumed by the A.O and had categorically brought to his notice that the jurisdiction in its case was vested with the A.O Range-IV, Jalandhar. It was only as on 28.05.2014, that a notice under Sec. 143(2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.O, then as per subsection (4) to Sec.124 the assessing officer shall, if not satisfied with the correctness of the claim, obligated to refer the matter for determination of jurisdiction to the appropriate authority as envisaged in sub-section (2) of Sec.124. Apart therefrom, the power to transfer cases is contemplated in Sec.127 of the I.T. Act. On a careful perusal of sub-section (2) to Sec.127, it transpires that a case can be transferred from one assessing officer to another, subject to satisfaction of twin conditions viz. (i) the assessee is afforded a reasonable opportunity of being heard in the matter, wherever it is possible to do so; and (ii) the reasons for transfer of the case have to be recorded at the time of passing of the order of transfer of the case. Admittedly, as per sub-section (3) to Sec.127 the requirement of giving an opportunity to the assessee where the transfer is from one assessing officer to another assessing officer, wherein the office of the said officers are situated in the same city, locality or place, had been dispensed with. However, the statutory requirement of recording of reasons for transfer of the case, befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umed by the A.O, observing that at the time of issuance of notice under Sec.143(2) the jurisdiction over the case of the assessee was vested with the ACIT, Circle-1, Jalandhar. The CIT(A) had further justified the assumption of jurisdiction by observing that as per the ITD data base the jurisdiction over the case of the assessee since 27.04.2010 was vested with the DCIT/ACIT, Circle-1, Jalandhar. Apart therefrom, it was observed by the CIT(A) that at the stance of the objections raised by the assessee as regards the issue pertaining to jurisdiction over its case, that the same during the said intervening period would have been transferred to the DCIT, Circle-IV, Jalandhar. Further, the CIT(A) was also of the considered view that the provisions of Sec.292B would provide a cushion to the A.O, and thus the assessment framed by him could also not be faulted with on the said count. 11. We have given a thoughtful consideration to the issue before us and are unable to persuade ourselves to subscribe to the aforesaid observations of the CIT(A). In our considered view, the observations of the CIT(A) as regards the validity of assumption of jurisdiction by the ACIT/DCIT, Cir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s as being in agreement with the view taken by the CIT(A) that the assessment framed by the Dy. CIT, Range-IV, Jalandhar on the basis of the notices issued under Sec.143(2)/142(1) by the Dy. CIT/ACIT, Circle-1, Jalandhar is well in order. We thus in terms of our aforesaid observations are of a strong conviction that the inferences drawn by the CIT(A) as regards the validity of the transfer of jurisdiction over the case of the assessee from the ACIT/DCIT, Circle-IV, Jalandhar to ACIT/DCIT, Circle-1, Jalandhar, and vice versa cannot be summarily accepted at the very face of it. As observed by us hereinabove, even if the observations of the CIT(A) that the jurisdiction over the case of the assessee pursuant to electronic system of filing of the income tax returns was from 27.04.2010 transferred from the ACIT/DCIT, Circle-IV, Jalandhar to Dy. CIT/ACIT,Circle-1, Jalandhar is accepted, even then in the absence of recording of reasons for such transfer as envisaged under Sec.127(2)(a) of the I.T. Act, the said claim of the A.O cannot be subscribed to and accepted as such. Insofar, the observation of the CIT(A) that even if the assumption of jurisdiction by the Dy. CIT/ACIT suffers from an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee pursuant to electronic system of filing of the income tax returns was from 27.04.2010 transferred from the ACIT/DCIT, Circle-IV, Jalandhar to Dy. CIT/ACIT,Circle-1, Jalandhar is accepted, even then in the absence of recording of reasons for the subsequent transfer of jurisdiction from Dy. CIT/ACIT,Circle-1, Jalandhar to Dy. CIT-IV, Jalandhar, as required as per the mandate of Sec..127(2)(a) of the I.T. Act, cannot be subscribed to and merit acceptance. We are of the considered view that as the A.O exercising the jurisdiction over the case of the assessee had failed to issue a notice u/s. 143(2) within the stipulated time period, therefore, the assessment framed by him under Sec.143 (3), dated 23.03.2015 san issuance of the aforesaid notice is absolutely bereft of any force of law and cannot be sustained. Our aforesaid view that a valid assessment under Sec. 143(3) presupposes issuance of a notice under Sec.143(2) finds support from the judgement of the Hon ble Supreme Court in the case of ACIT Anr. Vs. Hotel Blue Moon (2010) 321 ITR 362 (SC) . The Hon ble Supreme Court in the aforesaid judgment had observed that the omission on the part of the assessing officer to iss ..... X X X X Extracts X X X X X X X X Extracts X X X X
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