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TMI Blog2022 (11) TMI 367X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdiction over the assessee for this year. For that matter, it is not the case of the assessee that she was never a salaried employee. Assessment order starts with the sentence that the assessee, salaried employees has filed , suggesting that the assessee filed returns of income earlier years as a salaried employee. Basing on the PAN, the case was picked up for scrutiny by the Income Tax Officer, Ward-12(3), Hyderabad. Assessee never objected to the jurisdiction of Income Tax Officer, Ward-12(3). On this aspect, section 124(3) of the Act mandates that no person shall be entitled to call in question the jurisdiction of an Assessing Officer, where he has made a return under sub-section (1) of section 139, after the expiry of one month from the date on which he was served with a notice under sub-section (1) of section 142 or sub-section (2) of section 143 or after the completion of the assessment, whichever is earlier. Having regard to the legislative policy in enacting 124(3) of the Act, no different conclusion can be reached in the case on hand. Legislature is very clear in laying down the policy that no questions relating to the jurisdiction of the learned Assessing Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me and entire amount which was subjected to capital gain tax had not been utilized for the purpose of construction of new house, nor were un-utilized amounts deposited in notified bank accounts before filing return of income, the assessee is not entitled to claim deduction of that part of capital gains. This decision covers the case on hand. On a careful consideration of the facts and law on this aspect, we do not find anything illegality or irregularity in the action of the authorities below and accordingly the grounds of appeal are devoid of merits. - Decided against assessee. - ITA No. 1584/Hyd/2019 - - - Dated:- 17-10-2022 - Shri Rama Kanta Panda, Accountant Member And Shri K.Narasimha Chary, Judicial Member For the Assessee : Shri B. Shanti Kumar, AR For the Revenue : Shri A.P.Babu, DR ORDER PER K. NARASIMHA CHARY, JM: Aggrieved by the order dated 23/08/2019 passed by the learned Commissioner of Income Tax (Appeals)-1, Hyderabad ( Ld. CIT(A) ) in the case of Ms. Neeta Goswami ( the assessee ) for the assessment year 2016-17, assessee preferred this appeal. 2. Brief facts of the case are that the assessee filed the return of income for the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is without jurisdiction and assessment order is void ab initio. According to the learned AR, learned CIT(A) failed to deal with this aspect and, therefore, the impugned order as well as the assessment order are liable to be quashed, for want of jurisdiction. Learned AR placed reliance on the decisions reported in Kiran Singh and Others Vs. Chaman Paswan (1954) AIR SC 340, M/s. Mavany Brothers Vs. CIT [2015] 62 taxmann.com 50 (Bombay) and Sant Baba Mohan Singh Vs. CIT (1973) 90 ITR 197 (All) in support of his contention that this lack of jurisdiction goes to the root of the matter and vitiate the proceedings. 6. Per contra, learned DR submitted that there is no denial of the fact that the assessee paid only a sum of Rs. 11 lakhs towards purchase consideration during the year under consideration, and, therefore, the assessee cannot claim anything more as deduction under section 54 of the Act than what she has paid. He submitted that the CBDT circulars relied upon by the assessee relate to the self-financing scheme of the DDA or similar schemes floated by co-operative societies or other institutions which are similar to those mentioned in CBDT Circular No. 471. He accordingly submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) in support of this contention. 8. We have gone through the record in the light of the submissions made on either side. On facts, it remains undisputed that in the earlier years the assessee was a salaried employee and the assessment was taking place in the salary range. For this year, depending upon the PAN, the case was allotted to Income Tax Officer, Ward-12(3), Hyderabad. Assessee never objected for the jurisdiction of the learned Assessing Officer. At no point of time, the assessee brought it to the notice of the authorities that because there is no salary income in this year, though according to the PAN the matter was allotted to the Income Tax Officer, Ward-12(3), Hyderabad as a matter of fact, the salary range has no jurisdiction over the assessee for this year. For that matter, it is not the case of the assessee that she was never a salaried employee. Assessment order starts with the sentence that the assessee, salaried employees has filed .. , suggesting that the assessee filed returns of income earlier years as a salaried employee. 9. Basing on the PAN, the case was picked up for scrutiny by the Income Tax Officer, Ward-12(3), Hyderabad. Assessee never objected t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decree, and such a defect cannot be cured even by consent of parties. 11. Hon'ble Apex Court, however, went further and while referring to section 11 of the Suits Valuation Act (SV Act), where it was stipulated that an objection that a court which had no jurisdiction over a suit or appeal had exercised it by reason of over valuation or under valuation, should not be entertained by an appellate court, except as provided in the section, observed that such a provision is a self contained provision complete in itself and no objection to jurisdiction can be raised otherwise than in accordance with it. Hon'ble Apex Court held that this principle adopted in this section is the same as the principle enunciated section 21 of the Code of Civil Procedure (CPC) in respect of the objections relating to the territorial jurisdiction. After referring to the policy underlying sections 21 CPC and section 11 of SV Act. Hon'ble Apex Court held that when a case was tried by a court on merits, and judgment was rendered, it should not be liable to be reversed purely on technical grounds, unless it had resulted in failure of justice and the policy of the legislature has been to treat objec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. In Abhishek Jain (supra), the Hon'ble Delhi High Court discussed the issue in the light of the decision reported in CIT Vs. S.S.Ahluvalia (2014) 46 taxmann.com 169 (Delhi) and held that sub-section (3) of section 124 of the Act clearly states that no person can call in question jurisdiction of an Assessing Officer in case of non-compliance and/or after the period stipulated in clauses (a) and (b) which would negate and reject the arguments predicated on lack of subject matter jurisdiction. 16. On a careful consideration of the matter, we are of the considered opinion that neither the facts nor law are in favour of the assessee. Though the want of inherent jurisdiction vitiates the proceedings ab initio, lack of pecuniary or territorial jurisdiction does not vitiate the proceedings ipso facto but it requires the proof of resultant failure of justice because of such want of jurisdiction. This is the policy of the legislature under section 21 of the CPC as well as section 124(3) of the Act. We, therefore, find it difficult to sustain the argument advanced by the learned AR that the assessment is void ab initio for want of territorial jurisdiction with the learned Assessing O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruction and the fact that the amount was allowed to be paid in instalments does not affect the legal position stated above. In view of these facts, it has been decided that cases of allotment of fiats under the Self-Financing Scheme of the D.D.A. shall be treated as cases of construction for the purpose of capital gains . 18. Admittedly, assessee does not purchase the flat under the self-financing scheme of DDA. She, therefore, relies on Circular No. 672 wherein the board having considered the matter, decided that if the terms of the schemes of allotment and construction of a flats/houses by the cooperative societies or other institutions are similar to those mentioned in para to of the board circular No. 471, dated 15/10/1986, such cases may also be treated as cases of construction for the purpose of section 54 and 54F of the Act. 19. Though reliance is placed on the Circular Nos. 471 and 672, no material is produced before us to show that the assessee purchased the flat from any co-operative society or other institution under the schemes of allotment and construction of flats/houses which have the trappings of the self-financing scheme of DDA referred to in Circular No. 47 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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