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TMI Blog2022 (3) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... dl.CIT without proper authorization. The assessee succeeds on the additional ground of appeal - ITA NO.7514/MUM/2011, ITA NO.6781/MUM/2012, ITA NO.572/MUM/2014, ITA NO.1106/MUM/2015, ITA NO.1657/MUM/2014, ITA NO.1561/MUM/2015 - - - Dated:- 23-2-2022 - Shri Vikas Awasthy, Judicial Member And Shri M. Balaganesh, Accountant Member For the Assessee : Shri J.D. Mistry, Sr. Advocate with S/Shri Harsh M. Kapadia and K.Damania For the Revenue : Shri. Vatsalya Saxena Shri B.K.Bagchi ORDER PER BENCH: These four appeals by the assessee for Assessment Years 2007-08 to 2010-11 and two cross appeals by the Revenue for Assessment Years 2009-10 and 2010-11 are taken up together for adjudication as the legal issue and facts germane to the legal issue are identical The appeal of assessee in ITA No.7514/Mum/2011for Assessment Year 2007-08 is taken as lead case, hence, relevant facts to the legal issue raised are narrated therefrom. ITA NO.7514/MUM/2011,A.Y. 2007-08: 2. Shri J.D.Mistry, Sr. Advocate appearing on behalf of the assessee submitted, that at this stage he is confining his submissions only to the legal issue raised in additional grounds of appeal cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f appropriate orders u/s. 120(4)(b): a. From the Board, empowering the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be, to confer jurisdiction on the Additional Commissioner of Income Tax, and b. an order in writing from the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be, directing that the powers and functions of the assessing officer be exercised/ performed by an Additional Commissioner, the assessment order dated 25.10.2012 passed by him needs to be quashed. 3. Without prejudice to the above grounds, the assessment proceedings undertaken in the present case are bad in law and of no legal effect, for failure to comply with the provisions of the Statute including inter alia the absence of a valid notice under Section 143(2) of the Act. 4. The ld. Counsel for the assessee narrating the facts of the case submitted that the assessee filed its return of income for the Assessment Year 2007-08 on 31/01/2007. The return of the assessee was processed and intimation under section 143(1) of the Act signed by Assistant Commissioner of Income T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel for the assessee submitted that identical objection was raised by the assessee by way of additional ground of appeal in assessee s own case in the preceding Assessment Years. Similarly, in the case of other group companies, additional ground was raised assailing jurisdiction of Addl. CIT in passing the assessment order without authorization. The list of cases wherein additional ground of appeal assailing jurisdiction of Addl.CIT in passing the final assessment order was raised is as under: S.No. Particulars 1. Tata Communications Ltd.(ITA No.7071/M/2005( Mum. Tribunal) 2. Tata Communications Ltd.(M.A No.785/M/2017) (Mum- Tribunal) 3. Tata Communications Ltd. (ITA Nos.3972/M/2007, 2891 1505/M/2010 1109/M/2008) (Mum Tribunal) 4. Tata Communications Ltd. ( ITA Nos.4452 3460/M/2011, 8769/M/2010) (Mum Tribunal) 5. Tata Sons Limited (162 ITD 450) (Mum- Tribunal) 6. Tata Sons Limited ( ITA Nos. 193, 3745 3658/M/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d.Departmental Representative pointed that a perusal of the definition would show that JCIT means a person appointed to be JCIT or Addl. CIT u/s. 117(1) of the Act. The Department has issued notifications authorizing JCIT/Addl.CIT to be the Assessing Officer having jurisdiction over the assessee. 5.1 The ld.Departmental Representative has further placed reliance on the written submissions. The relevant extract of the same is reproduced hereunder : 4.1 In the context of above, it is submitted that the additional grounds raised by the assessee are factually incorrect and legally untenable. The Additional Commissioner of Income Tax, indeed had jurisdiction to pass the said order under section 143(3) of the I.T.Act, 1961, in view of Notification (a) S.O. 732(e) - Notification No. 228/200 1 [ F.No.187/5/2001] dated 31/07/2001 of CBDT. On the strength of the said notification No. 228/2001 [F.No. 187/5/2001 1TA- 1] dated 31/07/2000, further orders were passed by the PCIT-1, Mumbai assigning the case of M/s. Tata Communications Ltd. (formerly M/s. VSNL Ltd.) to the Jt./ Addl. Commissioner of Income tax -1(3), Mumbai vide order no. CIT-1/Mum/ Assignment of case to Addl.CIT/2010-11/1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us issues where AO had proposed additions/disallowances. The AO has thus discharged his onus of following the principle of Natural Justice and only on facts he has made the said disallowances which were later sustained by the Ld. CIT(A). 7.1 The assessee after realising that the additions/disallowances were made on factual/ legal grounds resorted to take refugee under false ground that the AO didn't had the jurisdiction to pass the said order in dispute despite the fact that under section 2(28C) of Income-tax Act, 1961 the term, Jt Commissioner of Income-tax includes an Addl. Commissioner of Income-tax and this definition was inserted by the Finance (No. 2) Act, 1998 w.e.f. 01/10/1998 . 5.2 The ld. Departmental Representative further in order to support his contentions placed reliance on the decision of Bangalore Bench in the case of Regional Oil Seed Growers Co-operative Society Union Ltd. vs. JCIT. The ld.Departmental Representative made alternate submission that though there is no defect in the jurisdiction of Addl. CIT exercising powers of Assessing Officer, even if it is assumed that there was any defect, the defect is rectifiable and not fatal. 6. Controvertin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roup concern, the Tribunal for parity of reasons has admitted additional ground and thereafter, decided the appeal by the assessee solely on the legal issue raised in additional grounds of appeal. The issue in additional grounds raised in the present appeal is similar to the issue raised in additional grounds raised in other appeals mentioned in para 4 above. For parity of reasons, objections raised by the Revenue against admission of the additional grounds are dismissed. The additional grounds raised in the appeal are admitted for adjudication on merits. 9. In so far as the legal issue we find that the same is squarely covered in favour of assessee by the order of Tribunal in assessee s own case in ITA No.7071/Mum/2005 for Assessment Year 2002-03 decided on 30/06/2017. The Co-ordinate Bench while adjudicating this issue has placed reliance on the decision of Tata Sons Ltd. (supra). For the sake of brevity only the concluding findings of the Co-ordinate Bench are reproduced: 16.The ratio laid down in the decision of Tata Sons Ltd. (supra) and other decisions relied upon by the Bench therein clearly applies the facts of the present case. Therefore, adhering to the principl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ub section (1) or sub section (2) of section 120. Whereas, as far as Addl. CIT, ADIT, JCIT, JDIT are concerned, they can exercise powers and functions of an Assessing Officer only, if they are directed to do so under clause (b) of sub section (4) of section 120. Thus, vesting of power of Assessing Officer on different income tax authorities have been specifically demarcated under section 120 of the Act. A conjoint reading of section 2(7A) and section 120 would make it clear, as far as Addl. CIT, Addl. DIT, DCIT, ADIT, DDIT and ITO are concerned, they have to be vested with the power of Assessing Officer under section 120(1) or (2), whereas, Addl. CIT, Addl. DIT, JCIT, JDIT can be vested with the power of Assessing Officer under section 120(4)(b). In a notification issued under section 120(1) and 120(2), Addl. CIT cannot be vested with power to act as an Assessing Officer. Therefore, notification no.228 of 2001 dated 31st July 2001, cannot be said to be in vesting power of Assessing Officer with the Addl. CIT. Similar is the situation with notification dated 1st August 2001, issued by the CIT, Mumbai, as it is a notification issued under section 120(1) and 120(2) and not under sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on by the learned Departmental Representative are not under section 120(4)(b). As far as notification dated 17th September 2001 of the Board is concerned, though, it is issued under section 120(4)(b) of the Act, however, it authorizes only the JCIT and JDIT to exercise the powers and function of the Assessing Officer and it is not in respect of Addl. CIT or Addl. DIT. Thus, none of these notifications can validly authorize or empower the Addl. CIT, Range 1(3) to act as an Assessing Officer in the present case. 11. Another argument raised by the ld. Departmental Representative is that in the order of Tribunal for assessee s own case for Assessment Year 2002-03 reliance has been placed on the decision of Mega Corporation Ltd. Vs. Addl. CIT in ITA No.102/Del/2014 decided on 22/09/2015. The ld. Departmental Representative has pointed that aforesaid decision of the Tribunal has been reversed by the Hon'ble Delhi High Court in Income Tax Appeal No.128 of 2016 decided on 23/02/2017. Thus, in view of the order of Hon'ble Delhi High Court no further reliance can be placed on the decision of Tribunal in assessee s own case for Assessment Year 2002- 03(supra). The ld.Counsel for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in view of the facts of the case and the decisions relied on by the assessee, we find merit in the additional grounds challenging validity of assessment order passed by Addl.CIT without proper authorization. The assessee succeeds on the additional ground of appeal. The impugned assessment order is held to be bad in law, passed without jurisdiction and hence, quashed. 13.. In the result, this appeal by the assessee is allowed. ITA No.6781/M/2012,A.Y. 2008-09; ITA No.572/M/2014, A.Y.2009-10; ITA 1106/M/2015, A.Y.2010-11 -ASSESSEE S APPEALS ITA No.1657/M/2014, A.Y.2009-10 ITA No. 1561/M /2015, A.Y.2010-11 REVENUE S APPEALS 14. Both sides are unanimous in stating that the additional grounds raised in these appeals are identical to the grounds raised in Assessment Year 2007-08. Further, the facts germane to the issue raised in additional grounds are also identical to the facts in Assessment Year 2007-08. Therefore, in view of the above findings given by us while adjudicating the appeal of assessee in ITA NO.7514/Mum/2011(Supra) would mutatis mutandis apply to the present set of appeals. Consequently, the appeals of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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