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TMI Blog2019 (10) TMI 344X X X X Extracts X X X X X X X X Extracts X X X X ..... se was not saved by the provisions of Section 124(5) as also by Section 127(4). There was no necessity for the assessee to have questioned the jurisdiction of AO at Delhi, as envisaged under sub-sec. (3) of sec. 124 of the Act since in the first place AO at Delhi legally enjoyed jurisdiction u/s. 124 of the Act over the assessee s case. In our opinion such an order is bad in law as held by the Hon ble Supreme Court in CIT V Hotel Blue Moon [ 2010 (2) TMI 1 - SUPREME COURT] wherein has held that issue of a legally valid notice u/s. 143(2) is mandatory for usurping jurisdiction to frame scrutiny assessment u/s. 143(3) of the Act and absence of a valid notice u/s 143(2) is not a curable defect. This view was reiterated by the Hon ble Apex Court in the case of CIT Vs Laxman Das Khandelwal [ 2019 (8) TMI 660 - SUPREME COURT] . The decision of the Hon ble Bombay High Court in the case of Fiat India Automobiles Ltd Vs Vijender Singh [ 2012 (11) TMI 287 - BOMBAY HIGH COURT] support the legal ground canvassed by the appellant before us. We uphold the objections raised by the appellant against the validity of the impugned order u/s 143(3) for AY 2015-16. We accordingly hold th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this issue only with the understanding that if the assessee does not succeed, then the appeal will be re-fixed for hearing on merits. 4. The brief facts pertaining to the legal issue is that the assessee company s Headquarters is at 101, Pragati Towers, 26 Rajendra Place, New Delhi-110007. The appellant was initially assessed by DCIT, Circle-15(1), New Delhi. By an order dated 08.10.2008 passed u/s 127(1) by the Ld. CIT, Del. V, New Delhi, the jurisdiction over the appellant s case was transferred to the charge of DCIT, Central Circle-1, Ranchi. Pursuant to the order dated 08.10.2008, the income-tax assessments from AY 2007-08 and onwards were passed by the said DCIT, Central Circle-1, Ranchi. For the assessment year 2015-16 i.e. the year under consideration, the return of income was electronically filed by the assessee on 30.09.2015 declaring total income of ₹ 1,27,03,820/-. Subsequently a notice u/s. 143(2) (paper book page 3 4) dated 28.07.2016 was issued by the ACIT, Circle-21(1), New Delhi to the assessee and this was followed by a notice u/s 142(1) dated 30.06.2017 issued by the same officer. Upon receipt of the notice u/s 142(1), the assessee furnished ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue of an order u/s. 127 dated 08.10.2008 passed by the ld. CIT, Delhi-V. We also note that subsequent to passing of the order dated 08.10.2008 and till the case records were again transferred u/s 127 dated 03.11.2017 to the charge of the present AO, all orders during such intervening period were passed by the DCIT, Central Circle-1, Ranchi. The ld. AR therefore submitted that in June 2016 a valid notice u/s 143(2) in relation to return filed for AY 2015-16 could have been issued only by the DCIT, Central Circle-1,Ranchi and by none else. He pointed out that during the entire assessment proceedings conducted by the Revenue for AY 2015-16, only one notice u/s 143(2) was issued and that too by the ACIT, Circle 21(1), New Delhi. Based on such notice alone, the ACIT, Central Circle 3(1), Kolkata ultimately framed the assessment order u/s 143(3) dated 29.12.2017. The Ld. AR therefore submitted that the notice u/s 143(2) issued by the ACIT, Circle 21(1), New Delhi was without jurisdiction and therefore illegal, the subsequent proceedings initiated u/s 142(1) and the consequent order u/s 143(3) passed by the ACIT, Central Circle 3(1), Kolkata was also ab initio void and therefore illegal. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officers/ Income Tax Officers and are not part of the substantive law. That the Act i. e. Income Tax Act 1961 being a complete code deals with substantive and procedural aspects. Section 120/124/127 govern the process of procedure for assessment and not the subject matter or its purpose. They relate to conduct of the Assessing Officer/Income Tax Officers and the assessees in respect of the assessment proceedings. It is a matter of merely a process. An irregularity in procedure need not result in annulment unless the statute specifically stipulates to the contrary. The appellate authorities have right to put a clock back and direct the Income Tax Officer/Assessing officer to follow the procedure notwithstanding the difference between mandatory and directory procedural norms. ii). The provision on sec 127 of the act does not speak of transfer of jurisdiction but transfer of case. Being an enactment aimed at collecting revenue, the Legislature did not intend collection of revenue to be bogged down on account of technical plea of jurisdiction. It has, therefore, prescribed the limit up to which the plea of jurisdiction may be raised. As provid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... location of the assessee s Principal Office address at Delhi. It was urged by the Ld. CIT, DR that section 124(5) of the Act saves assessment made by an assessing officer provided that the assessment does not bring to tax anything other than the income accruing, arising or received in that area over which the assessing officer exercises jurisdiction . However, Ld. CIT, DR clarified that notwithstanding Section 124(5) of the Act which saves the action of AO in certain cases, said section does not postulate multiple assessments by different assessing officers, or assessment of part or portion of an income [see Kanjimal Sons Vs. Commissioner of Income Tax, New Delhi, (1982) 138 ITR 391 (Del)]. Thus, according to Ld. CIT, DR, it is necessary that the Assessing Officers having concurrent jurisdiction ensure that only one of them proceeds and adjudicate. This, according to Ld. CIT, DR, is the purport and objective behind sub-section (2) to Section 124 of the Act. 9. Further it was pointed out by Shri Radhey Shyam, the Ld. CIT, DR that it is undisputed that in earlier years also the case of assessee was assessed at New Delhi up to AY 2007-08 and the jurisdiction was tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... current jurisdiction. It is to refers the decision of hon'ble Supreme Court in case of HarshadChiman Lal Modi Vs. DLF Universal Ltd. Anr., (2005) 7 SCC 791, which classifies and draws jurisprudential difference amongst - territorial or local jurisdiction; pecuniary jurisdiction; .and jurisdiction over the subject matter. As far as territorial or pecuniary jurisdictions are concerned, objection should be taken at the earliest possible opportunity and for before the settlement of issues and not at the subsequent stage. In view of the above discussion, objections as to the jurisdiction of assessing officer in the present case cannot be equated with lack of subject matter jurisdiction. They relate to place of assessment. Income-Tax Officer would not per se lack jurisdiction, albeit he had concurrent jurisdiction with the DCIT. 9.1 The issue of validity of jurisdiction could have been raised before the A.O. after expiry of one month from the date of issuance of notice u/s 143(2). But it has been raised before the CIT(A). CIT(A) has ignored the concept of concurrent jurisdiction. The Instruction No. 119 is administrative in nature, which is though binding on A.O., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had tacitly admitted that neither he nor any officer acting under his jurisdiction could exercise jurisdiction over the appellant s case for the purposes of the provisions of the Income-tax Act, 1961 after the CIT-V, New Delhi had passed the order u/s 127 dated 08.10.2008 transferring the jurisdiction to the charge of ACIT, Central Circle, Ranchi. Drawing attention to these jurisdictional facts, the ld. AR submitted that it was abundantly clear that in June 2016 when the notice u/s 143(2) was issued, the ACIT Circle-21(1), New Delhi did not have jurisdiction over the appellant s case and consequently therefore the notice u/s 143(2) issued by him was non-est in the eyes of law. Consequently therefore when the AO at Kolkata proceeded with the assessment subsequent to such illegal notice, the consequent order u/s 143(3) was equally bad in law and liable to be cancelled. 11. We have heard both the sides and perused the records. Before us the Ld. AR of the assessee has raised the jurisdiction of the AO at Kolkata who passed the assessment order without issue of notice u/s. 143(2) of the Act, which according to Ld. AR, is mandatory to assume jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sdiction over the assessee s case u/s. 127 to DCIT, Central Circle-1, Ranchi. 3. From 09.10.2008 to 03.11.2017 DCIT, Central Circle-1, Ranchi was the AO of assessee for all proceedings under the Act. 4. 28.07.2016 ACIT, Circle-21(1), New Delhi issued notice u/s. 143(2) to the assessee. 5. 30.06.2017 ACIT, Circle-21(1), New Delhi issued notice u/s. 142(1) to the assessee. 6. 17.07.2017 Assessee objected to jurisdiction of ACIT, Circle-21(1), New Delhi. 7. 07.08.2017 Show Cause Notice/proposal for centralization of assessee s case at Kolkata issued by Pr. CIT-7, Delhi. 8. 16.08.2017 Assessee objected to the juris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions of Section 120, 124, 127 and 129 of the Act which are reproduced herein below: 120. Jurisdiction of income- tax authorities (1) Income- tax authorities shall exercise all 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- section (1) may authorise any other income- tax authority to issue orders in writing for the exercise of the powers and performance of the functions by all or any of the other income- tax authorities who are subordinate to it. (3) In issuing the directions or orders referred to in sub- sections (1) and (2), the Board or other income- tax 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y virtue of any direction or order issued under sub- section (1) or sub- section (2) of section 120, the Assessing Officer has beenvested 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 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 Commissioners or Commissioners, by the Directors General or Chief Commissioners or Commissioners concerned or, if they are not in agreement, by the Board or by such Director Gene ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e from one or more Assessing Officers subordinate to him (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) also subordinate to him. (2) Where the Assessing Officer or Assessing Officers from whom the case is to be transferred and the Assessing Officer or Assessing Officers to whom the case is to be transferred are not subordinate to the same Director General or Chief Commissioner or Commissioner,- (a) where the Directors General or Chief Commissioners or Commissioners to whom such Assessing Officers are subordinate are in agreement, then the Director General or Chief Commissioner or Commissioner from whose jurisdiction the case is to be transferred may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, pass the order; (b) where the Directors General or Chief Commissioners or Commissioners aforesaid are not in agreement, the order transferring the case may, similarly, be passed by the Board or any such Director Gener ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Authorities, as specified u/s. 116 of the Act. As per sub-section (2) of Section 120 of the Act, the Board may delegate its powers to Income tax authorities as specified in Section 116, for issuing the orders in writing, for the exercise of the powers and performance of the functions by all or any of the other Income Tax Authorities who are subordinate to that authority. We also note that the concurrent jurisdiction can be vested in more than one AO, which is discernible by a conjoint reading of Section 120(5) with Section 120(2) of the Act. Section 124(1) of the Act confers jurisdiction on an AO, by virtue of jurisdiction vested by any direction or order issued by CBDT under sub-section (1) and / or (2) of section 120 of the Act. The AO is vested with the jurisdiction u/s. 124 of the Act, over any area within the limits of such area, he shall have jurisdiction over any person (assessee) carrying on a business or profession and if the place at which he (assessee) carries on his business or profession is situated within the area ear-marked for him (AO); or if that person s (assessee s) business or profession is carried on in more places than one, then if the principal place of his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on AO respectively and, therefore, both sections i.e. sections 120 and 124 of the Act must be read in conjunction and harmoniously to decide the territorial jurisdiction which is prescribed by the direction or orders by the CBDT under sub-sec. (1) or (2) of sec. 120 of the Act. 15. Having taken note of the provisions of Section 120 124, we however find that Section 127 is a separate code of its own. Section 127(1) empowers, the Pr. Director General or Director General or Pr. Chief Commissioner or Chief Commissioner or Pr. Commissioner or Commissioner, as stipulated therein, to transfer any case from one or more AO subordinate to him. In other words, under Section 127(1) the Pr. Director General or Director General or Pr. Chief Commissioner or Chief Commissioner or Pr. Commissioner or Commissioner, as stipulated therein, can transfer the case records of an assessee from one AO to another functioning under his own charge. On the contrary, Section 127(2) empowers the foregoing authorities to transfer of cases from the AOs from his jurisdiction to the AOs who are not functioning under his jurisdiction and therefore who are not subordinate to such authority. In the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r pre and post proceedings from the date of transfer. In other words, once transfer order of a case of an assessee is issued u/s. 127 of the Act the effect will be that (i) all the proceedings of the assessee under the Act in respect of any year which may be pending on the date of such order will stand transferred, (ii) all the completed assessment order of the assessee on or before the date of transfer will stand transferred and (iii) all proceedings under the Act in respect of the assessee which may be commenced after the date of such transfer order have to be undertaken by the transferred new AO. 16. In the light of the above discussion, we now examine the facts involved in the appellant s case and ascertain whether the ACIT, Circle 21(1), New Delhi enjoyed concurrent jurisdiction over the appellant s case so as to enable him to issue a valid notice u/s 143(2) for the AY 2015-16. As noted, the jurisdiction over the appellant s case initially vested with the ACIT, Circle 15(1), New Delhi since the territorial jurisdiction over area or limits of area, where assessee s principal office was situated. The vesting of jurisdiction with the said officer was in terms of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom whom the case is transferred. Explanation: In section 120 and this section, the word case , in relation to any person whose name is specified in any order or direction issued thereunder, means all proceedings under this Act in respect of any year which may be pending on the date of such order or direction or which may have been completed on or before such date, and includes also all proceedings under this Act which may be commenced after the date of such order or direction in respect of any year. 18. From a plain reading of sub-sec. (5) of sec. 124 of the Act, it is noted that though it is an over-riding provision yet it has inherent limitation as prescribed in law. If one carefully reads sub-section (5) of sec. 124 of the Act, then it will be noted that it starts with the words Notwithstanding anything contained in this section or in any direction or order issued under section 120 of the Act . The express language employed by the Legislature clearly shows that provisions of sub-sec. (5) of section 124 overrides only the other provisions of Section 124 of the Act and any orders/directions issued u/s. 120 of the Act, which necessarily mea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s. 127(2)by thePr.CIT, Central, Patna dated 03.11.2017 as per which the jurisdiction stood transferred to the ACIT, Central Circle 3(1) Kolkata. We are therefore of the firm opinion that in June 2016 when the notice u/s 143(2) was issued, it was the ACIT, Central Circle 1, Ranchi alone enjoyed sole jurisdiction over the appellant s case and in that view of the matter it was only this AO who could have issued a valid notice u/s 143(2) for the relevant AY 2015-16. We therefore have no quarrel with the proposition put forth by the ld. CIT, DR that when the ACIT, Central Circle 3(1), Kolkata received the case records in terms of the order u/s 127(2) dated 03.11.2017, he had no obligation to issue a fresh notice u/s 143(2) because he could have continued with the assessment proceedings from the stage at which his predecessor would have left. However this legal proposition pre-supposes that the original notice u/s 143(2) was issued by an officer who held valid jurisdiction over the case of the assessee. We however find that although in June 2016, the jurisdiction over the assessee s case was vested in ACIT, Central Circle 1, Ranchi, he never issued notice u/s 143(2). On the contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO derives his powers from the direction or order issued by CBDT and/or authorities under sub-section (1) or (2) of sec. 120 of the Act respectively. It is true that when a question of jurisdiction arises in the event an AO assumes jurisdiction u/s. 124 of the Act by virtue of the jurisdiction vested by direction or order issued by CBDT and/or other authorities under sub-section (1) or (2) of sec. 120 of the Act respectively, then assessee is estopped from raising an objection to the jurisdiction, after the time period prescribed under sub-section (3) of sec. 124 of the Act lapses. This however is not the fact of the appellant s case. Admittedly the AO at Delhi who had enjoyed jurisdiction u/s. 124 of the Act by virtue of direction or order issued by CBDT and/or authorities under sub-section (1) or (2) of section 120 of the Act was legally divested of his jurisdiction over the appellant s case by virtue of the order u/s. 127 of the Act dated 08.10.2008, and thereafter AO at Delhi could not have suo moto assumed jurisdiction u/s. 124 of the Act. In our opinion therefore in the appellant s case, the provision of section 124(3) does not come into play since the case of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferred to ACIT, Central Circle-3(l), Kolkata. Therefore, as per the discussions (supra) there was no necessity for the assessee to have questioned the jurisdiction of AO at Delhi, as envisaged under sub-sec. (3) of sec. 124 of the Act since in the first place AO at Delhi legally enjoyed jurisdiction u/s. 124 of the Act over the assessee s case. In our considered opinion Section 124(3) of the Act does not in any way help the Department to justify the action of AO at New Delhi in issuing under Section 143(2) to the assessee, which is an action without jurisdiction. So the challenge raised by the Ld CIT, DR fails. Therefore, we do not find any merit in the contention of the Ld. CIT, DR on this score. 22. During the course of hearing before us, the Ld. CIT, DR took pains to convince us that there are overlapping/concurrent jurisdiction in respect to the territorial and pecuniary jurisdiction of the AO and, therefore, the AO having territorial jurisdiction over the assessee s principal office at Rajendra Place, New Delhi having issued the notice u/s. 143(2) of the Act was empowered to do so since the ACIT, Circle-21(1), Delhi enjoyed the concurrent juri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice to assessee 4. 29th July, 2013 Actual transfer of files took place from ITO, Wd-4(1), Kolkata to ACIT/DCIT, Central Circle-XIX, Kolkata. 5. 18th March, 2013 Notice u/s. 263 issued by CIT, Kolkata-II proposing to interfere in the assessment order passed by ITO, Wd-4(1), Kolkata dated 21st May, 2010 (AY 2008-09). 6. 26th March, 2013 CIT-II, Kolkata passed the order u/s. 263 setting aside the order of ITO, Wad-4(1) dated 21st May, 2010 for AY 2008-09. 23. The aforesaid order of CIT-II, Kolkata was challenged by the assessee [M/s Ramshila,]objecting to the jurisdiction of CIT-II, Kolkata who had issued Show Cause Notice u/s. 263 and thereafter passed order u/s. 263 dated 26th March, 2013 for AY 2008- 09. The validity of the said revision order was upheld by this Tribunal in favour of the department, by observing as under: The definition of cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... findings in that behalf are arbitrary, unreasonable and perverse?. 25. In this case which is reported as M/s.Ramshila Enterprises Pvt. Ltd. Vs. Pr. CIT (2016) 383 ITR 546 (Cal), we note that the gist of department s contention was taken note by the Hon ble High Court, which is as under: Mr. Ghosal, learned senior advocate appearing for the Revenue submitted that the transfer order itself indicates that jurisdiction of the Income-tax Officer, Wd-4(1), Kolkata was transferred to ACIT/DCIT, Central Circle-XIX, Kolkata, which is at page 584. The jurisdiction of the Commissioner of Income-tax remained unchanged. In other words, it is the jurisdiction of the trial court, which was changed. The jurisdiction of the appellate authority remained unchanged. Therefore, the order under challenge was validly passed by the Commissioner of Income-tax. 26. Per contra; in that case, the assessee contended that as per the Explanation appended to section 127 of the Act that the expression transfer of a case would mean all pending and future proceedings and in that case it was pointed out that Tribunal also agreed that only C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a matter required to be decided by a Division Bench of the High Court is decided by a learned Single Judge, the judgment would be a nullity, the matter having been heard by a court which had no competence to hear the matter, it being a matter of total lack of jurisdiction.The accused was entitled to be heard by at least two learned Judges constituting a Division Bench and had a right to claim a verdict as regards his guilt or innocence at the hands of the two learned Judges.This right cannot be taken away except by amending the rules.So long as the rules are in operation it would be arbitrary and discriminatory to deny him this right regardless of whether it is done by reason of negligence or otherwise.Deliberately, it cannot be done.Negligence can neither be invoked as an alibi, nor can cure the infirmity or illegality, so as to rob the accused of his right under the rules.What can be done only by at least two learned Judges cannot be done by one learned Judge.Even if the decision is right on merits, it is by a forum which is lacking in competence with regard to the subject matter.Even a right decision by a wrong forum is no decision.It is non-existent in the eye of law.And h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n over the matter. He became functus officio . Reference in this regard may be made to the Stroud s Judicial Dictionary of Words and Phrases, 7th Edition, Page 1085 wherein the following meaning has been expressed: FUNCTUS OFFICIO. An arbitrator or referee cannot be said to be functus officio when he has given a decision which is held to be no decision at all (Davies v Howe Spinning Co LTD.27 B.W.C.C.207). Where a judge has made an order for a stay of execution which has been passed and entered, he is functus officio, and neither he nor any other judge of equal jurisdiction has jurisdiction to vary the terms of such stay (Re V.G.M.Holding Ltd [1941].3 All E.R.417). An arbitrator or umpire who has made his award is functus officio, and could not by common law alter it in any way whatsoever; he could not even correct an obvious clerical mistake. See Mordue v Palmer, 6 Ch. App.22; Henfree v Bromley, 6 East, 309; Brooke v Mitchell, 6 M. W.473. See now Arbitration Act 1950 (c.27).s.17. Reference may also be made to the judgement in the case of Re V.G.M.Holdings, Ltd. 1941 (3) All England L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and when that function was performed by the Collector he became functus officio. It was observed by the Supreme Court that the power to impound only exists when an instrument is produced before judicial officers or other officers performing judicial functions as evidence of any fact to be proved, or before other public officers who have to perform any function in regard to those instruments as, for example, registration. The Supreme Court also approved the decisions in Collector, Ahmednagar v. Rambhau, AIR 1930 Bom 392 (FB). Paiku v. Gaya, ILR (1948) Nag 950 : (AIR1949Nag 214) and Panakala Rao v. Kumaraswami, AIR 1937Mad 763 where the doctrine of functus officio was applied and it was held that the Court had no power to recall and impound a certificate of sale after executing it and delivering it to the purchaser, or to reopen a case and impound documents proved after signing the decree, or to impound an instrument admitted in evidence after delivery of judgment.Here, when the Sub- In the present case, the Sub-Registrar purported to act under paragraph 232 of the Registration Manual when he made a report to the Collector tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to a shorthand writer [if the Judge is specially empowered (sic by the High Court) in this behalf].The proviso thereto provides that where the judgment is pronounced by dictation in open court, the transcript of the judgment so pronounced shall, after making such corrections as may be necessary, be signed by the Judge, bear the date on which it was pronounced and form a part of the record.Rule 3 provides that the judgment shall be dated and signed by the Judge in open court at the time of pronouncing it and when once signed, shall not afterwards be altered or added to save as provided by Section 152 or on review.Thus, where a judgment is reserved, mere dictation does not amount to pronouncement, but where the judgment is dictated in open court, that itself amounts to pronouncement.But even after such pronouncement by open court dictation, the Judge can make corrections before signing and dating the judgment.Therefore, a Judge becomes functus officio when he pronounces, signs and dates the judgment (subject to Section 152 and power of review).The position is different with reference to quasi-judicial authorities.While some quasi-judicial tribunals fix a day for pronouncement and p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 263 setting aside the order of the ITO, Ward-4(1), Kolkata dated 21.05.2010. 29. Coming back to the case in hand, and having taken note of the ratio laid down by the Hon ble jurisdictional High Court (supra), we note that in the present case, after the order of the CIT-V, New Delhi dated 08.10.2008 transferring the jurisdiction of the assessee s case to DCIT, Central Circle, Ranchi, the CIT, Delhi became functus officio and thereby his subordinate officers viz., ACIT, Circle 21(1), New Delhi, could not have issued notice u/s. 143(2) dated 28.07.2016 and in that view of the matter the notice issued by the ACIT, Circle-21(1), New Delhi u/s 143(2)was without jurisdiction and, therefore, non-est in the eyes of law. 30. Our above finding also finds support from the decision of this Tribunal in the case of Chankya Finvest Pvt Ltd Vs ITO (34 taxmann.com 206). In that case the CIT Delhi had passed an order u/s 127 dated 04.01.2010 transferring jurisdiction over the assessee s case from ITO, Delhi to ITO Kolkata. After the order u/s 127 was passed on 04.01.2010, the ITO at Delhi initiated reassessment proceedings after recording reasons and issued not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ou to either, call for the records and adjudicate the validity of reopening or grant an adjournment of 15 days to obtain certified copies of all related records so that we can represent the matter properly. The CIT(A) sent this written submission to ITO, Ward-6(1), Kolkata vide letter No. CIT(A)- VI/Kol/Remand/2011-12/368 dated 20-02-2010 and the AO sent its remand report vide letter No. Wd- 6(1)/Kol/ChanakyaFinvest/11-12/826 dated 23-04-2010, which is as under: Kindly refer to your letter No. CIT(A)-VI/Kol/Remand Report/2011-12/368 dated 20.02.2012. In this connection following information as available from the record are chronologically appended below: Date Happening 1. 04-01-10 Order u/s l27 passed by the Ld. CIT, Delhi-I, New Delhi. 2. 23-03-10 Proposal to re-open the case was sent to Ld. Addl. CIT, Range-3 Delhi. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discussed the issue and observed in paras 8 and 9 as under: 8. The appellant submitted during the appellate proceedings that he does not submit any additional evidences, books of account or other documents either before the appellate authority or Assessing Officer since these are not available with appellant. The appellant has never taken objection regarding the jurisdiction of issuance of notice u/s 148 by the Assessing Officer of New Delhi or initiation/continuation of assessment proceedings by the Income-tax Officer, Ward 6(1), Kolkata before the Assessing Officer during the assessment proceedings even when the authorised representative attended the proceedings on 08-12-2010 and 16-12-2010. The authorised representative asked for the extension of time from Assessing Officer on 20-12-2010 but did not file any objection regarding the jurisdiction of the Assessing Officer and did not attend the proceedings thereafter. The assessment has been completed on 29-12-2010. 9. The Income-tax Officer, Ward (1) has submitted that the case records were not transferred to him and was still lying with ITO Ward 3(3), New Delhi on the date of issuance of not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s issued or at the time of assessment with the Assessing officer at Kolkata. There was a possibility to the Assessing Officer at New Delhi to get the records transferred immediately to Kolkata and a fresh notice may have been issued during the time-limitation by Assessing Officer at Kolkata. 20. Following the law laid down and upheld by the Hon'ble appellate authorities as discussed above, the legal provisions of section 124(3) on this issue and in the facts and circumstances of the case, it is held that the assessment order passed u/s 147/144 of the I.T. Act 1961 is not without jurisdiction and is as per law and hence the assessment order passed by the Assessing Officer is held to be a valid order. In the facts and circumstances of the case the proceedings u/s 148 of the I T Act 1961 is upheld to be valid in absence of any objection being raised before the Assessing Officer issuing the notice u/s 148 and/or completing the assessment. In the facts and circumstances of the case it is also held that appellant was given proper opportunity after serving the notice u/s 148 and during assessment by the Assessing Officer. Hence, these three grounds of appeal are dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are required to be initiated or taken by that jurisdiction AO only. Even the CIT(A) noted that the assessee has never objected regarding the jurisdiction of issuance of notice u/s. 148 of the Act by the AO of New Delhi or initiation/continuation of assessment proceedings by the ITO, Ward-6(1), Kolkata before the AO during the assessment proceedings. Whether such a plea can be accepted or not? Before us, Ld. Sr. DR heavily relied on the decision of Hon'ble Punjab Haryana High Court in the case of SubhashChander v. CIT [2008] 166 Taxman 307 wherein the non-objection as per section 124(2) read with section 124(4) of the Act, the jurisdiction assumed by AO was held to be valid. Further, there was reliance by Sr. DR on the case law of Hon'ble Allahabad High Court in the case of CIT v. British India Corpn. Ltd. [2011] 337 ITR 64 [2012] 20 taxmann.com 446, wherein assumption of jurisdiction, by AO for assessment, u/s. 124 of the Act that when the ITO had jurisdiction when assessment proceedings commenced and a draft assessment order was submitted to IAC but due to subsequent change in jurisdiction, unless the same brought to the notice of the authority concern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m, come within the jurisdiction of the newly conferred authorities unless any specific provision is made in respect of any pending proceedings. Such consequence is inevitable when there is withdrawal of jurisdiction, which means automatic extinction of jurisdiction of one authority with simultaneous conferment of jurisdiction on another authority under the Act in respect of all pending and future proceedings. Explanation to section 127 of the Act makes it clear that the word case in relation to any person whose name is specified in the order of transfer means all proceedings under the Act in respect of any year which may be pending on the date of the transfer, and also includes all proceedings under the Act which may be commenced after the date of transfer in respect of any year. The word case is thus used in a comprehensive sense of including both pending proceedings and proceedings to be instituted in the future. Consequently, an order of transfer can be validly made even if there be no proceedings pending for assessment of tax and the purpose of the transfer may simply be that all future proceedings are to take place before the officer to whom the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pune, the Petitioner in June-July, 2009 had applied for transfer of assessment records from Mumbai to Pune. After, exchange of several letters, the CIT-10 Mumbai by his order dated 22.11.2011 transferred the powers to assess the petitioner from ACIT-10(1) Mumbai to DCIT, Circle-1(2) Pune. Thus, from 22.11.2011 ACIT-10(1) Mumbai did not have any power to assess or reassess the petitioner. 5. It is not in dispute that on transfer of the jurisdiction from Mumbai to Pune, the Additional CIT, (TP) Pune has assumed jurisdiction and accordingly issued a notice dated 29.03.2012 to the Petitioner under Section 92CA of the Act relating to Assessment year 2009-2010. 6. However, the ACIT-10(1) Mumbai has issued the impugned notice on 30.03.2012 under Section 14 8 of the Act with a view to reopen the assessment for A.Y. 2005-06. The assessee by its letter dated 24.04.2012 objected to the impugned notice by specifically stating that pursuant to the order of CIT dated 22.11.2011, the ACIT-10(1) would have no locus standi or jurisdiction to issue the impugned notice dated 30.03.2012. As there was no reply, the present writ petition is filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3.2012 behind the back of the petitioner whether the ACIT-10(1) Mumbai is justified in issuing the impugned notice under Section 148 of the Act dated 30.03.2012 on the basis of the said corrigendum order dated 27.03.2012 which is passed without issuing a notice to the petitioner, without hearing the petitioner and which is uncommunicated to the petitioner. 13. Mr. Pinto, learned Counsel for the Revenue does not dispute that the corrigendum order was passed without issuing notice and without hearing the petitioner and further admits that the said corrigendum order was not served upon the petitioner till date and that he has tendered a copy of the said corrigendum order upon the counsel for the petitioner today in Court. However, he submits that once the corrigendum order was passed by the CIT-10 Mumbai on 27.03.2012 the ACIT-10(1) Mumbai was justified in issuing the impugned notice dated 30.03.2012. 14. In our opinion, the conduct of ACIT-10(1) Mumbai as well as CIT-10 Mumbai is highly deplorable. Once the jurisdiction to assess the petitioner was transferred by the CIT-10 Mumbai from ACIT-10(1) Mumbai to DCIT Circle-1(2) Pune by order dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bai and in gross abuse of the process of law. Apart from the fact that the CIT-10 Mumbai had no jurisdiction to temporarily suspend an order passed under Section 127(2) of the Act, in the fact of the present case, the impugned corrigendum order passed behind the back of the petitioner without issuing any notice to the petitioner, without hearing the petitioner and admittedly uncommunicated to the petitioner till date, would have no legal existence and therefore the impugned notice dated 30.03.2012 based on the legally non-existent corrigendum order dated 27.03.2012 cannot be sustained. 32. Before us the ld. CIT, DR supported the AO s order by placing strong reliance on the decisions of the Hon ble Delhi High Court in the cases of Abhishek Jain VsITO (supra) and SS Ahluwalia (supra). As observed earlier, these decisions were rendered in totally different factual context and therefore the proposition laid down in these decisions cannot be applied. In the case of Abhishek Jain (supra), the AO at Noida had issued notice u/s 148 on the basis of cash deposits made in ICICI Bank, Noida. In that case the fact that the assessee was regularly assessed in D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as transferred to ITO, Ward 20, New Delhi. Thus, the case of S.S. Ahluwalia (supra) cannot be of any assistance to the Revenue. 34. We note that in support of contentions raised the ld. CIT, DR relied on the certain observations in the above decisions (supra). As noted, the facts of both the cases were materially different from the facts involved in the appellant s case. One has to bear in mind that the text of any decision is rendered in the context of the facts which are before the Court. It is therefore settled legal proposition that the observations of the Hon ble Court must be read in the context of the facts and the issues before the Hon ble Court for consideration. The Hon ble Supreme Court in the case of CIT Vs Sun Engineering Works (P) Ltd (198 ITR 297) has observed as follows: It is neither desirable nor permissible to pick out a word or a sentence from the judgment of the Court, divorced from the context of the question under consideration and treat it to be the complete 'law' declared by the Court. The judgment must be read as a whole and the observations from the judgment have to be considered in the light of the questions wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the undisputed findings arrived at by the Commissioner of Income Tax (Appeals), the additions made under Section 68 of the Income Tax Act, 1961 should be deleted or set aside? 4. The High Court, disagreeing with the Tribunal, held, that the provisions of Section 142 and sub-sections (2) and (3) of Section 143 will have mandatory application in a case where the assessing officer in repudiation of return filed in response to a notice issued under Section 158-BC(a) proceeds to make an inquiry. Accordingly, the High Court answered the question of law framed in affirmative and in favour of the appellant and against the Revenue. The Revenue thereafter applied to this Court for special leave under Article 136, and the same was granted, and hence this appeal. 13. The only question that arises for our consideration in this batch of appeals is: whether service of notice on the assessee under Section 143(2) within the prescribed period of time is a prerequisite for framing the block assessment under Chapter XIV-B of the Income Tax Act, 1961? 27. The case of the Revenue is that the expression so far as may be, apply indicates that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the orders passed on record as well as the stand taken by the Appellant in the memo of appeal. It was further submitted that issuance of notice under Section 143(2) of the Act being prerequisite, in the absence of such notice, the entire proceedings would be invalid. 8. The law on the point as regards applicability of the requirement of notice under Section 143(2) of the Act is quite clear from the decision in Blue Moon's case2. The issue that however needs to be considered is the impact of Section 292BB of the Act. 9. According to Section 292BB of the Act, if the assessee had participated in the proceedings, by way of legal fiction, notice would be deemed to be valid even if there be infractions as detailed in said Section. The scope of the provision is to make service of notice having certain infirmities to be proper and valid if there was requisite participation on part of the assessee. It is, however, to be noted that the Section does not save complete absence of notice. For Section 292BB to apply, the notice must have emanated from the department. It is only the infirmities in the manner of service of notice that the Section seeks t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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