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TMI Blog2021 (9) TMI 1394X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, the AO has rightly forwarded the draft of the proposed order of assessment on 03.01.2014 as per the provisions of Section 144C(1) and the assessee has also filed his objections to the variation with ld. DRP on 29.04.2014 in accordance with the Section 144C(2). The ld. DRP vide order dated 31.12.2014 has issued directions in accordance with the provisions of Section 144C(6). Subsequently, the assessee upon the receipt of the directions issued under sub-section (5) has completed the assessment on 08.01.2015. Thus, on going through the entire provisions of the law, the judgments quoted, the orders of the Tribunal, the procedure followed by the assessee, TPO, ld. DRP and the Assessing Officer has been found to be correct as per the provisions of the Act inserted by the Finance (No.2) Act, 2009, hence, the additional grounds filed on 8.7.2021 with regard to non-applicability of provisions Section 144C are hereby dismissed. Jurisdiction of JCIT, Hisar Range - As argued that the Joint Commissioner is not competent to pass the order under the provisions of Section 143(3) - HELD THAT:- Board may assign the power to any Income Tax Authority to exercise powers of the A.O. having regard t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have jurisdiction over the case of assessee and since he did not assume the jurisdiction legally and validly, therefore, the impugned assessment order framed by him is vitiated and illegal and without jurisdiction. In view of the above discussion, we set aside the order of the authorities below and quash the impugned order. X X X X Extracts X X X X X X X X Extracts X X X X ..... ee having availed the beneficial provision of pre-adjudication of the Assessment Order by the way of ld. DRP as provided u/s 144C cannot raise the issue in the form of any additional grounds at the juncture. The ld. AR argued that the additional grounds being legal in nature can be raised at any point of time. Keeping in view, the judgment of the Hon'ble Apex Court in the case of National Thermal Power Co. Ltd. Vs CIT (1998) 229 ITR 383, the additional ground filed by the assessee is admitted. The relevant portion of the judgment is as under: "5. Under Section 254 of the Income-tax Act, the Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. The power of the Tribunal in dealing with appeals is thus expressed in the widest possible terms. The purpose of the assessment proceedings before the taxing authorities is to assess correctly the tax liability of an assessee in accordance with law. If, for example, as a result of a judicial decision given while the appeal is pending before the Tribunal, it is found that a non-taxable item is taxed or a permissible deduction is denied, we do not see any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut where the Tribunal is only required to consider a question of law arising from the facts which are on record in the assessment proceedings we fail to see why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee. 8. The reframed question, therefore, is answered in the affirmative, i.e., the Tribunal has jurisdiction to examine a question of law which arises from the facts as found by the authorities below and having a bearing on the tax liability of the assessee. We remand the proceedings to the Tribunal for consideration of the new grounds raised by the assessee on the merits." 9. At the time of hearing, the Ld. AR submitted that the additional grounds filed on 8th July, 2021 with regard to the provisions of Section 144C may be taken up initially. The Ld. AR submitted that the provisions of Section 144C was introduced by the Finance (No. 2) Act, 2009 w.r.e.f. 01.04.2009, and, therefore, the same is not applicable for the present/impugned assessment year which is A.Y. 2010-11. The Ld. AR relied upon the recent decision of the Hon'ble Madras High Court in case of Vedanta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee have at the outset rightly followed the provisions of reference to ld. DRP as enunciated u/s 144C. 11. Heard the arguments of both the parties and perused the material available on record. The Ld. AR relied upon the decision of the Hon'ble Madras High Court in case of Vedanta Ltd. (Supra) wherein the writ petition was filed by the assessee in respect of Assessment Year 2007-08. The decision of the Hon'ble Madras High Court is dated 22nd October, 2019 which is now before us. The Moot questions in this appeal before the Tribunal is that whether Assessment Year 2010-11 come under the purview of Section 144C or not and whether the assessment passed was bad in law, void-ab-initio and barred by limitation. To begin with, we will find that the provisions of Section 144C which was inserted by the Finance (No.2) Act, 2009, with retrospective effect from 1/4/2009 which is not challenged at any Court of Law. The heading of the Section 144C is 'Reference to Dispute Resolution Panel'. Thus, Section 144C is specifically in respect of 'Reference to Dispute Resolution Panel' and it is a mechanism to resolve Tax Disputes between the assessee and the Revenue Department. Section 144C has gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eptance by the assessee. The provisions of Section 144C reads as under: "144C. (1) The Assessing Officer shall, notwithstanding anything to the contrary contained in this Act, in the first instance, forward a draft of the proposed order of assessment (hereafter in this section referred to as the draft order) to the eligible assessee if he proposes to make, on or after the 1st day of October, 2009, any variation which is prejudicial to the interest of such assessee. (2) On receipt of the draft order, the eligible assessee shall, within thirty days of the receipt by him of the draft order,- (a) file his acceptance of the variations to the Assessing Officer; or (b) file his objections, if any, to such variation with,- (i) the Dispute Resolution Panel; and (ii) the Assessing Officer. (3) The Assessing Officer shall complete the assessment on the basis of the draft order, if- (a) the assessee intimates to the Assessing Officer the acceptance of the variation; or (b) no objections are received within the period specified in sub-section (2). (4) The Assessing Officer shall, notwithstanding anything contained in section 153 or section 153B, pass the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the revenue, respectively. (12) No direction under sub-section (5) shall be issued after nine months from the end of the month in which the draft order is forwarded to the eligible assessee. (13) Upon receipt of the directions issued under sub-section (5), the Assessing Officer shall, in conformity with the directions, complete, notwithstanding anything to the contrary Contained in section 153 or section 153B, the assessment without providing any further opportunity of being heard to the assessee, within one month from the end of the month in which such direction is received. (14) The Board may make rules for the purposes of the efficient functioning of the Dispute Resolution Panel and expeditious disposal of the objections filed under sub-section (2) by the eligible assessee. (14A) The provisions of this section shall not apply to any assessment or reassessment order passed by the Assessing Officer with the prior approval of the [Principal Commissioner or] Commissioner as provided in sub-section (12) of section 144BA.] (15) For the purposes of this section,- (a) "Dispute Resolution Panel" means a collegium comprising of three Principal Commissioners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the instant case cannot be held to be invalid. 18. The Finance (No.2) Act, 2009, has given a beneficial legislation for the assessee who can speed up their tax disputes for which the assessee has to avail the provisions, the assessee cannot contest that the order passed in conclusion be bad in law or void ab-initio or barred by limitation. In-fact, the assessee's contentions before the assessment proceedings were properly taken into account and there was no procedural lapse pointed out by the assessee or Ld. AR as prescribed u/s 144C as well as there was no lapse on substantive basis, as the assessee has availed the remedy prescribed under the Section before the Revenue Authorities. To clarify further, the Finance Act clearly mentions that the reference to Dispute Resolution Panel was inserted by the Finance(No.2) Act, 2009, w.r.e.f. 01.04.2009, Section 144C(1) clearly mentions that notwithstanding anything to the contrary contained in the Act, in the first instance, forward a draft of the proposed order of the assessment to the eligible assessee, if he proposes to make on or after 1st day of October 2009, any variation in the income or loss return which is prejudicial to the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as it has been passed by the Competent Authority. The Ld. D.R. submitted that in terms of Section 124(3) jurisdiction of an A.O. cannot be called in question by the assessee after the expiry of one month from the date on which he was served with the notice, which in this case assessee has not raised any objection. The Ld. D.R. in support of the above proposition relied upon the following decisions: * Mr. Abhishek Jain vs. ITO 94 taxmann.com 355 (HC) * CIT vs. S.S. Ahluwalia 46 taxmann.com 169 22. Further, it was argued that the CIT, Hisar vide order dated 29.07.2013 had issued order u/s 120 of the Income Tax Act, 1961 assigning the case to the Joint Commissioner. The ld. DR submitted the written reply received from JCIT, Hisar and the order dated 29.07.2013 of the CIT, Hisar. 23. For the convenience of the ready reference, the entire submission of the ld. DR along with the order dated 29.07.2013 passed by the CIT, Hisar is reproduced as under: Dated: 06.02.2020 F. No. JCIT/HSR/2019-20/2896 To, The Income Tax Officer, O/o The Commissioner of Income Tax (DR) (TP) Income Tax Appellate Tribunal, 1-1 Bench, Lok Nayak Bhawan, Khan Market, New Delhi-110003. Sub: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - 125 001 (Haryana.) Dated: 29.07.2013. ORDER: In exercise of powers conferred by sub section (1), (2) and (5) of Section 120 of the Income Tax Act, 1961 read with CBDT's Notification No: 251/2001 (F.No: 187/6/2001-IT(A-1) dated 23.08.2001 enabling me in this behalf, I, the Commissioner of Income Tax, Hisar hereby authorize the Assessing Officers of this Charge mentioned in Column 6 to concurrently exercise powers and function of the Assessing Officers mentioned in column 5 in respect of the cases mentioned in Column No. 3 of the table: S. No. PAN Name of the Assessee A.Y. From To 1 AAACJ7097D J Jindal Steel & Power Ltd., Delhi Road, Hisar 2010-11 ACIT, Hisar JCIT, Hisar Range, Hisar 2 ABCFS5513P Sushil Kumar Munish Kumar, 39A, Nai Anaj Mandi, Hisar 2011-12 ITO W-4, Hisar JCIT, Hisar Range, Hisar 3 AABCM0054E Mangali Petrochem Ltd. 2011-12 ACIT, Hisar JCIT, Hisar Range, Hisar 4 AAIFA6955C Ajay Polymers, 14th K.M. Stone, Delhi Road, Hisar 2011-12 ACIT, Hisar JCIT, Hisar Range, Hisar 5 AACCS9317B Supreme Mobiles Ltd., 473- 74, Automobiles Market, Hisar 2011-12 ITO W-4, Hisar JCIT, Hisar Range, Hisar 6 AAAAT8856C The Bass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Board of Direct Taxes, hereby:- (a) directs that the Commissioner of Income-tax specified in column(2) of Schedule annexed hereto shall perform their functions in respect of such territorial areas or such persons or classes of persons or of such incomes or classes of incomes or of such cases or classes of cases in respect of which the said Commissioners of Income-tax were performing their functions immediately before the commencement of the Government of India, Central Board of Direct Taxes Notification number 732(E) dated 31.07.2001, by virtue of the jurisdiction vested in them under notifications issued by the Board or any other Income-tax authority from time to time; (b) further directs that the Joint Commissioners of Income-tax subordinate to the Commissioners of Income-tax referred to in clause (a) shall perform their functions in respect of such territorial areas or such persons or classes of persons or of such incomes or classes of incomes or of such cases or classes of cases in respect of which the said Commissioners of Income-tax were performing their functions immediately before the commencement of the Government of India, Central Board of Direct Taxes Notif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s notification. 2. This notification shall come into force with effect from the date of publication in the official Gazette. S. No. Designation of Income-tax authorities Head quarter Cases or class of cases (1) (2) (3) (4) 1 Commissioner of Incometax (Central-I), Delhi Delhi All cases assigned under section 127 of the Income-tax Act, 1961(43 of 1961). 2 Commissioner of Incometax (Central- II), Delhi Delhi All cases assigned under section 127 of the Income-tax Act, 1961(43 of 1961). 3 Commissioner of Incometax (Central- III), Delhi Delhi All cases assigned under section 127 of the Income-tax Act, 1961(43 of 1961). 4 Commissioner of Incometax (Central-I), Mumbai Mumbai All cases assigned under section 127 of the Income-tax Act, 1961(43 of 1961). 5 Commissioner of Incometax (Central- II), Mumbai Mumbai All cases assigned under section 127 of the Income-tax Act, 1961(43 of 1961). 6 Commissioner of Incometax (Central- Ill), Mumbai Mumbai All cases assigned under section 127 of the Income-tax Act, 1961(43 of 1961). 7 Commissioner of Incometax (Central- IV), Mumbai Mumbai All cases assigned under section 127 of the Income-tax Act, 1961( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1961(43 of 1961). [Notification No. 251/2001/F. No. 187/6/2001/ITA-I] PROMILA BHARDWAJ, Director 25. Perusal of the above notification issued by the CBDT which has been relied upon and quoted in the order dated 29/07/2013 by the Ld.CIT Hisar doesn't confer any such powers to the CIT Hisar. Thus, the order dated 29.07.2013 passed by the CIT, Hisar is without any order by the CBDT u/s 120(4). 26. In the light of these facts, the legal issue of conferring the jurisdiction on the AO by the CIT is examined in detail. 27. Section 2(7A) of the I.T. Act, 1961, provides definition of "Assessing Officer" Section 2 (7A) - 2. In this Act, unless the context otherwise requires,- (7A) "Assessing Officer" means the Assistant Commissioner or Deputy Commissioner or Assistant Director or Deputy Director or the Income-tax Officer who is vested with the relevant jurisdiction by virtue of directions or orders issued under sub-section (1) or sub-section (2) of section 120 or any other provision of this Act, and the Additional Commissioner or Additional Director or Joint Commissioner or Joint Director who is directed under clause (b) of subsection (4) of that section to exer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se may be, assigned to, the Assessing Officer by or under this Act in respect of any specified area or persons or classes of persons or incomes or classes of income or cases or classes of cases, shall be exercised or performed by an Additional Commissioner or an Additional Director or a Joint Commissioner or a Joint Director, and, where any order is made under this clause, references in any other provision of this Act, or in any rule made thereunder to the Assessing Officer shall be deemed to be references to such Additional Commissioner or Additional Director or Joint Commissioner or Joint Director by whom the powers and functions are to be exercised or performed under such order, and any provision of this Act requiring approval or sanction of the Joint Commissioner shall not apply. (5) The directions and orders referred to in subsections (1) and (2) may, wherever considered necessary or appropriate for the proper management of the work, require two or more Assessing Officers (whether or not of the same class) to exercise and perform, concurrently, the powers and functions in respect of any area or persons or classes of persons or incomes or classes of income or cases or classe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner or Pr. Commissioner or Commissioner to issue order in writing that the powers and functions conferred on or as the case may be assign to the A.O. by or under this Act in respect of any specified area or person or class of persons or income or class of income or case or class of cases, shall be exercised or perform by Joint Commissioner or Others and where any order is made under this clause, reference in any other provisions of this Act or in any Rules made thereunder to the A.O. shall be deemed to be reference to the Joint Commissioner or Others by whom the powers and functions are to be exercised or perform under such order and any provisions of this Act requiring approval or sanction of the Joint Commissioner shall not apply. 33. These provisions, therefore, make it clear that the Board may assign the power to any Income Tax Authority to exercise powers of the A.O. having regard to territorial area etc., or the Board may authorise or empower Pr. Director General, Pr. Chief Commissioner etc., to issue order in writing to assign powers of the A.O. to other Authorities including Joint Commissioner of Income Tax as Assessing Officer. 34. Considering the provisions of Section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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