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TMI Blog2023 (10) TMI 393X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Act is held to be without valid jurisdiction. 2.2. The CIT(A) failed to note that as per sub-section (3) of Section 124, the assessee is not entitled to question the jurisdiction of the AO, since he has not raised the question within the time allowed for filing of return u/s. 148 or within the period allowed for reply to show cause u/s. 144. Therefore, the determination of the question of territorial jurisdiction of the AO in appeal is not legal. 2.3. Having regard to the Hon'ble Calcutta High Court's decision in the case of Elite Pharmaceuticals Vs.ITO (2016) 242 Taxman 345, where in it was held that since the objection to territorial jurisdiction of AO was not raised by assessee within 30 days even from the date of issuance of Notice under section 148, assessee had lost right to raise objection by efflux of time, the CIT(A) ought to have upheld the action of the AO in reopening the assessment. 2.4. The CIT(A) failed to note that in the instant case, Notice u/s. 148 was issued on 31.03.2018 and the assessee raised objection to territorial jurisdiction during the appellate proceedings only and hence the assessee has no right to raise objection on territorial jur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oted that assessment u/s 143(3) was completed on 27-03-2014 and the only discussion in that order was qua the jurisdiction of AO. It was mentioned that the jurisdiction of the assessee vests with ITO, Business Ward XV (4), Chennai as the address of the assessee was Alwarpet, Chennai. Subsequently, present AO received information from ACIT, Corp. Circle 3(1) and issued notice u/s 148 at Porur address as against the fact that in assessment order u/s 143(3), the address of the assessee was mentioned as Alwarpet, Chennai. In spite of that, AO mentioned in the proposal seeking approval for issuance of notice u/s 148 that there was no PAN, no return of income filed by the assessee and no scrutiny assessment had taken place. Further, the address was mentioned as Porur address which was no longer the address of the assessee. Considering the restructuring of the department w.e.f. 15-11- 2014, the jurisdiction of assessee lies with Non-Corporate Range 3. In spite of that, present AO i.e., DCIT, NCC 8(1) issued notice u/s 148 at old Porur address and completed the assessment. Therefore, AO mechanically issued notice merely on the basis of information supplied by ACIT, Corporate Circle 3(1) wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the appellant firm. The original scrutiny assessment u/s 143(3) in the case of the appellant was completed on 27/3/2014 accepting the returned income of the appellant and the sole issue In the assessment order was the jurisdiction of the appellant and in the said assessment order, the A.O has given a categorical finding that the jurisdictional A.O is ITO, Business Ward XV(4), Chennai. As per the said assessment order, the then A.O, had reproduced the necessary documentary evidence. In the said assessment order including the Form No. 26AS of the appellant for the year under consideration which categorically states the address of the appellant as Alwarpet, Chennai 600018 and finally concluded that for the said address, the Jurisdiction lies with Business Range XV. As per the scrutiny assessment order u/s 143(3) dt. 27/3/2014, the A.O has mentioned inter alia the PAN as AAOFM9784F and the address of the appellant as Alwarpet, Chennai 600018 in the first page of the assessment order. In spite of that, the present AO has mentioned in the proposal for the issuance of Notice u/s 148 that there is no PAN, there was no return and there was no scrutiny assessment and further the addres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act like jurisdiction etc. During the appellate proceedings, the appellant vehemently objected to the issuance of notice u/s 148 by the present A.O, DCIT, NCC 8(1), Chennai. It was repeatedly reiterated that consequent to the cadre restructuring of the Department, as per the Notification issued by the Department, it is only Non Corporate Range 3, which has jurisdiction over the appellant. To support the contention of the appellant, the following documents were also submitted: a)Transfer Memo Dated 3/9/2013 from the ITO Ward 1(1) Vellore transferring the file to Income Tax Officer Business Ward XV(4) (Now redesignated as ITO Non Corporate Ward 3(4). b) Copy of the Scrutiny Asst Order for the Asst Year 2011-12 dated 27/03/2014 passed by the ITO Business Ward XV(4). c) copy of the Letter dated 29/1/2016 addressed to the assessee from the Income Tax Officer NCW 3(4) requesting the assessee, the Appellant herein to file the returns of income for the asst Years 2012-13 to 2015-16 based on the return of income filed for the asst year 2011-12. d)Copy of the letter dated 27/10/2017 addressed to the assessee from the ITO NCW 3(4) requiring the assessee to pay the balance tax fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the A.O to proceed with the assessment and thus, affects the validity of the proceedings for assessment or reassessment. A notice Issued u/s 148 of the Act by a non-jurisdictional A.O cannot be held to be valid. Only the jurisdictional A.O would assume valid jurisdiction under a notice u/s 148. In the case under consideration, as stated herein, the notice u/s 148 of the Act, which is a jurisdictional notice has been issued by a non-jurisdictional A.O as per the jurisdictional order of the Department and the provisions of the Act. The present A.O in the present case has erred by Issuing notice u/s 148 In the case of the appellant, in spite of the fact that the jurisdiction was decided in the original scrutiny assessment order In the case of the appellant u/s 143(3), Therefore, it is held that the Notice u/s 148 issued by the non-jurisdictional A.O in the present case is held to be invalid and therefore not legally tenable. Further, the present A.O has also invoked the provisions of Clause (a) of Explanation 2 of Section 147 which is both factually incorrect as well as legally not tenable. In the absence of a valid jurisdiction, the A.O has no authority to assume jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tructuring of the Department w.e.f. 15-11-2014, the jurisdiction of the appellant for Alwarpet, Chennai 600018 address lie with Non-Corporate Range 3 whereas notice has been issued by present AO i.e., DCIT, NCC 8(1) at Porur address. It could also be seen that AO has wrongly invoked the provision of clause (a) of Explanation 2 of Section 147, which applies only where no return of income has been furnished by the assessee. However, in the case of the assessee, the return of income was filed and the scrutiny assessment u/s 143(3) was completed by the jurisdictional AO accepting the returned Income of the assessee. Therefore, present AO has wrongly invoked the provisions of Clause (a) of Explanation 2 of Section 147, which applies only where no return of income has been furnished by the assessee. The AO has not perused the original assessment records and had proceeded to issue the notice u/s 148 without verification of the documents on record. Accordingly, the conclusion that notice u/s 148 was issued mechanically without due application of find could not be faulted with. 7. The Ld. Sr. DR has referred to the decision of Hon'ble High Court of Delhi in the case of Abhishek Jain vs. IT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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