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TMI Blog2022 (5) TMI 1528X X X X Extracts X X X X X X X X Extracts X X X X ..... sed off by an officer having no jurisdiction. This does not mean that proceedings came to an end. The proceedings can validly be completed and finalized by an officer who has valid jurisdiction and who had initiated the proceedings. This view of ours find support from the decision of Shivkumar Agrawal [ 1990 (7) TMI 105 - ORISSA HIGH COURT] . Thus the assessment order passed by the ITO, Ward-2, Rourkela in the case of the assessee for the A.Y.2010-2011 is set aside. Consequently, the order of the ld. CIT(A), who was adjudicated the appeal against the said assessment order passed by the ITO Ward-2, Rourkela, is also set aside. - ITA No.176/CTK/2016 - - - Dated:- 31-5-2022 - SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI ARUN KHODPIA, ACCOUNTANT MEMBER For the Assessee : Shri Sidharth Ray/Binod Agarwal, ARs For the Revenue : Shri M.K.Gautam, CIT-DR ORDER Per Bench : This is an appeal filed by the assessee against the order of the ld. CIT(A), Cuttack, in I.T.Appeal No.121/2012-13, dated 29.02.2016 for the assessment year 2010-2011. 2. The assessee has raised a legal ground which reads as under :- A) For that the transfer of the case for the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Rourkela in the case of the assessee for the A.Y.2010-2011 was nullity in law and liable to be quashed. It was also submitted by the ld. AR that the consequential order passed by the CIT(A) is also liable to be quashed. 6. In reply, the ld. CIT-DR submitted that the assessee has not challenged to the jurisdiction within the time provided in Section 124(3) of the Act being the period of one month from the issuance of the notice much less within one month from the end of the passing of the assessment order. It was the submission that the assessee having not challenged the jurisdiction within the time provided u/s.124(3) of the Act, the assessee is precluded from challenging the jurisdiction any further. It was the submission that the JCIT, Rourkela Range, Rourkela had the powers to transfer the case from any officer under his jurisdiction to any other officer under his jurisdiction as long as it was within the same range. It was also the submission that there was a Circular issued by the CBDT sometime in 2001 but due to efflux of time the said Circular is not available immediately. It was further submitted that all the officers within the same range hold concurrent jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , then the higher authority can direct the lower authority in rank amongst them to exercise the powers and functions. 7. Ld. CIT-DR further placed reliance on the decision of the Hon ble Kolkata High Court in the case of Elite Pharmaceuticals, reported in (2016) 73 taxmann.com 69 (Calcutta), wherein in paras 12, 13 16, the Hon ble High Court has held that in view of the provisions of Section 124(3) of the Act, the challenge to the jurisdiction cannot be made beyond this period prescribed therein being period of one month. Ld. CIT-DR also placed reliance on various Tribunal decisions such as decision of the Chennai Bench of the Tribunal in the case of Karandhai Tamil Sangam 97 taxmann.com 50 (Chennai Tribunal). Further to support his stand, ld. CIT-DR relied on the decision of the Jodhpur Bench of the Tribunal in the case of Vaishali Builders Colonizers, reported in 25 taxmann.com 464 (Jodhpur Bench). Ld. CIT-DR has also filed written submission, which is extracted herein below :- 1. In this case, the appellant AOP by way of revised grounds of appeal filed on 01.03.2021 has challenged the action of the ]CIT to transfer the case from ACIT, Rourkela Circle, Rourkela to IT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13. Mr. Dutt submitted that the writ petitioner-appellants did not raise any objection because he had no knowledge of the change of jurisdiction made by the notification issued by the CBDT referred to above. It may be true that the writ petitioners did not have knowledge of the aforesaid notification but limitation on that account shall not remain suspended nor can the period during which the writ petitioner appellant was ignorant about the change of jurisdiction can be excluded because that would be contrary to Section 124(3) of the Act. 15. The assessee had questioned the territorial jurisdiction on the assessing officer and the assessing officer held that the assessee had lost the right to raise the objection by efflux of time. We, as such, find no substance in the case of the appellant. 16. Mr. Mukherjee, learned Advocate appearing for the revenue, drew our attention to a judgement of the Delhi High Court in the case of CIT Vs. Shri Shyam Sunder Infrastructure (P.) Ltd. [IT Appeal No. 236 of 2014] wherein the following views were taken :- Facially, Section 124(3) stipulates a bar to any contention about lack of jurisdiction of an AO. It is not as if the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... igh Court of Madras has dismissed the Writ Petition vide order dated 24.08.2011. Here in respect of Writ Petition filed by the assessee and the order passed by the Hon'ble Jurisdictional High Court there on it should be clearly understood that e challenge in the Writ Petition was in respect of the order passed u/s.127(3) regarding the transfer of jurisdiction. What is before the Tribunal Is not the transfer of jurisdiction, but is a challenge to the jurisdiction u/s, 120(4)(b) of the Act. This challenge to the jurisdiction is completely different from the challenge to the transfer of jurisdiction, which has been made in the Writ Petition and which has been dismissed by the Hon'ble jurisdictional High Court. Admittedly, no evidence of filing of writ appeal or pendency of the Writ Appeal or any orders passed by the Hon'ble jurisdictional High Court in respect of the Writ Appeal has been produced before us. The challenge to the jurisdiction u/s.120(4)(b) of the Act has not been made within the prescribed time u/s.124(3) of the Act to the authority, whose jurisdiction is being challenged. Consequently, the issue of the challenge of the jurisdiction no more survives. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of assessment, whichever was earlier. Sub-section (4) lays down that when an assessee raises a dispute regarding jurisdiction of the Assessing Officer and the Assessing Officer if not satisfied with the correctness of the claim, he shall refer the matter for determination as per subsection (2) of Section 124, however, this should be done before the assessment was made. The aforesaid Section, therefore, postulates waiver of objection to assumption of jurisdiction by the Assessing Officer. Time limit for raising the objection stands stipulated. Principle of deemed waiver applies. This could only happen when the authority does not lack or suffer from inherent lack of subject matter jurisdiction. When there is inherent lack of subject matter jurisdiction, principle of waiver does not apply. The principle being simple that by consent one cannot confer jurisdiction on authority which lacks inherent subject matter jurisdiction. The provisions ensure that conflict between Assessing Officers having concurrent jurisdictions is avoid and curtailed and the assessment proceeding do not get misdirected on side issues. Such deviation should be avoided. It is also clear that question of juris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the 1922 Act could not be made a subject or issue before the appellate forums including the Tribunal and reference to the High Court. The position is no different under the Act i.e. Income Tax Act 1961, as was elucidated by a Division Bench of the Hon'ble Delhi High Court in the case of Kanji Mal Sons vs. CI.T. (1982) 138 ITR 391 (Del), wherein reference to said two decisions was made and it was observed that if the assessee fails to raise objection before the Income Tax Officer within the time, he will be shut out from raising the question altogether. 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 . 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 thus, it is necessary that the Assessing Officers having concurrent jurisdiction ensure that only one of them proceeds and adjudicates. This is the purport and objective beh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in favour of the plaintiffs. But the unfortunate part of the whole case is that the civil court had no jurisdiction at all to entertain the suit. It is true that such a contention with regard to the jurisdiction had not been raised by the defendant in the trial court but where the court is inherently lacking in jurisdiction the plea may be raised at any stage, and, it is conceded by Mr Yogeshwar Prasad, even in execution proceedings on the ground that the decree was a nullity. If one reads Sections 209 and 331 of the U.P. Act 1 of 1951 together one finds that a suit like the one before us has to be filed before a Special Court created under the Act within a period of limitation specially prescribed under the rules made under the Act and the jurisdiction of the ordinary civil court is absolutely barred. (emphasis supplied) 32 In Most Rev. P.M.A. Metropolitan v. Moran Mar Marthoma MANU/SC/0407/1995: 1995 Supp (4) SCC 286 as well, , a three Judge bench of this Court entertained an objection as to maintainability of the suit under Section 9 of the CPC, despite the plea not having been raised before the courts below. The Court observed that the plea of a bar or lack of jurisdic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered and when the issue strikes the heart of the matter. He also placed reliance upon the decision of the Hon ble Jurisdictional High Court in the case of Shri Bijoy Kishore Mohanty, passed in ITA Nos.29 and 30 of 2021, wherein following the decision of the Hon ble Supreme Court in the case of Saurav Jain (supra), it has been held that once the Court while admitting the appeal has framed a question and that order has not been challenged by the department, the department cannot raise an objection at the hearing stage to the framing of such question by the Court. It was, thus, the submission that the revenue having not shown that the JCIT, Rourkela Range, Rourkela had power to transfer the case from ACIT Rourkela Circle, Rourkela to the ITO Ward-2, Rourkela, therefore, the assessment order passed by the ITO Ward-2, Rourkela is liable to be quashed. It was also submitted by the ld. AR that the assessee was not challenging the jurisdiction of the AO to pass the assessment order but was challenging the jurisdiction of the JCIT in respect of transfer of the case from ACIT Rourkela Circle, Rourkela to the ITO Ward-2, Rourkela. Therefore, the assessment order and the order of CIT(A) ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment would not hold good insofar as if what is said is true then what was the necessity of the JCIT, Rourkela Range, Rourkela to pass an order transferring the case for the purpose of completion of the assessment from the ACIT, Rourkela Circle, Rourkela to the ITO Ward-2, Rourkela. If all the officers in the range had the jurisdiction then nothing stopped any officer within the range from picking up any assessment of any assessee falling within that range for the purpose of competing an assessment. This is not what is provided under the Act. These facts being evident, it becomes clear that JCIT, Rourkela Range, Rourkela did not have the powers to transfer the case of the assessee for the assessment year 2010-2011 from ACIT, Rourkela Circle, Rourkela to the ITO Ward-2, Rourkela for the purpose of completion of the assessment. 14. Admittedly, under normal circumstances, a consequential assessment order passed by the ITO Ward-2, Rourkela would be liable to be quashed. However, a perusal of the assessment order shows that a notice u/s.143(2) of the Act had originally been issued by the ACIT, Rourkela Circle, Rourkela, who had the jurisdiction to do the assessment of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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