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TMI Blog2024 (6) TMI 410X X X X Extracts X X X X X X X X Extracts X X X X ..... no jurisdiction over the assessee, therefore, erred in confirming the order u/s 144 r.w.s 147, wherein, an addition of Rs. 1,22,19,500/- is made u/s 69A of the IT Act. 4. The learned Commissioner of Income Tax (Appeals) ought to have appreciated that the assessee filed return of income before 4 ITO Ward-10(4), Hyderabad being a business ward, whereas the notice issued u/s 148 and assessment made u/s 144 r.w.s 147 by the AO of salary Ward, who has no jurisdiction over the assessee, therefore, the CIT ought to have held that the order is null and void. 5. The learned Commissioner of Income Tax (Appeals) erred in considering the notice u/s 148 dt: 20.12.2017, as an invalid notice, therefore, further, erred in 5 confirming the order u/s 144 r.w.s 147, which is consequent to notice u/s 148 dt: 21.06.2016, which becomes infructuous once a fresh notice is issued on 21.12.2017. 6. The learned Commissioner of Income Tax (Appeals) ought to have estimated a reasonable profit on the business receipts of Rs. 1,22,19,500/- instead of confirming the entire receipts as income." 2.1. Thereafter, the assessee had raised the following additional grounds of appeal. 1. The learned ITO War ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , a notice u/s 148 of the Act was issued on 21.06.2016. In response to the notice, the assessee filed her return of income for AY 2013-14 on 27.08.2016 declaring total income at Rs. 5,39,110/-. Subsequently, notices u/s 143(2) & 142(1) of the Act were issued to the assessee. Since there was no response to the above said notices, the AO completed the assessment by making an addition of Rs. 1,22,19,500/- towards unexplained money u/s 69A of the Act and passed assessment order on 21.12.2017 u/s 144 r.w.s. 147 of the Act. 4. Feeling aggrieved with the order of Assessing Officer, assessee filed an appeal before the ld. CIT(A), who dismissed the appeal of assessee. 5. Aggrieved with the order of ld.CIT(A), assessee is now in appeal before us on the grounds mentioned hereinabove. 6. Before us, ld. AR has submitted that the Assessing Officer had added the entire money deposited in the bank as the income of the assessee. It was the contention of the assessee that the assessee was doing consultancy business and other jobs for which the assessee has earned the amount and thereafter, the sum was deposited in the bank account. However, the ld.CIT(A) has not considered the request of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly. In this regard it is respectfully submitted that the assessee joined judicial service in the month of October 2016, therefore, for the period from October 2016 to March 2017, the return of income was filed admitting salary income and the return was uploaded to salary ward. It is pertinent to mention here that the notice u/s 148 was issued to the assessee by ITO Salary ward on 21.06.2016, on that day the assessee was not having any salary income, therefore, it is respectfully submitted that when the notice u/s 148 is issued the ITO salary circle was not having jurisdiction over the assessee, therefore, the notice issued on A.00.2016 is without jurisdiction by the ITO salary ward, therefore, is an invalid notice. III. Be that as it may be, the learned Assessing Officer also issued another notice.' on 21.12.2017, may be to rectify the jurisdictional defect and completed the assessment on the same day. This notice was received by the assessee in her email on the same day. Therefore, it is submitted that in view of the fresh notice on 21.12.2017, the earlier notice 21.06.2016 becomes infructuous and assessment made on the earlier notice which is an infructuous notice and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich remand report was called for. The issue covered in the said remand report was regarding the jurisdiction and improper service of notice u/s 148. Based on the remand report and hearing the case, the CIT(A) did not agree with the contentions of the assessee and dismissed the appeal. 3. The assessee has carried the matter before the Hon'ble ITAT raising the issue of jurisdiction and requesting for estimating income on cash deposit. The sequence of events leading to challenge of jurisdiction are as under- - There was information that the assessee has deposited a sum of Rs. 1.22 cr in her saving bank accounts. The assessee did not file her ROI, therefore the AO of salary ward obtained approval for issuing notice u/s 148 dated 17/06/2016. - The PAN was lying in the jurisdiction of the salary AO and hence he was competent to issue notice u/s 148. Further as no return was filed at that point of time, the sources of income could not have been ascertained. - The notice u/s 148 was issued on 21/06/2016 at the addresses - (i) H. No. 10-4-4 Khairatabad, East Marredpally, Secundrabad 500026 and (ii) H. No. 10-3-1/14, Sy No. 19, Flat No. 202, 2nd Floor, Laxmi Residency Apartm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowing reasons - i. When the first notice was issued, the assessee had not filed her return of income and based on the PAN lying in his jurisdiction, the AO assumed jurisdictional to issue notice u/s 148. However, after the return was filed and source of income could be known, the case was transferred to AO having jurisdiction over business income. Subsequently, based on the source of income for AY 2017-18 which was shown as salary, filed on 21/08/2017, the jurisdiction wag again reverted back to ITO Wd 12(2), Hyderabad. As per the order u/s 120 of the I.T. Act, the source of income is used to determine the jurisdiction. It is pot material what was the source in earlier year. Based on the current source of income, the AO assumes jurisdiction to assessee the present as well as the past income irrespective of the source. Here for AY 2017-18 the assessee showed income from Salary and thus the jurisdiction falls under the ITO Wd 12(2), Hyderabad. Subsequent event has crystallized the jurisdiction with ITO Wd 12(2), Hyderabad and since at the time of issue of notice u/s 148 on 21/06/2016, the assessee did not file her ROT, the jurisdiction was assumed based on the PAN. Lastly it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eneral or Director General or the Principal Chief Commissioner or Chief Commissioner or the Principal Commissioner or Commissioner as the case may be. It is also made clear in sub-sec (5) that every AO shall have all the powers in respect of the income accruing / arising within the area over which he has jurisdiction. The assessee has filed submission before the Hon'ble ITAT relying on Gauhati HC in the case of Nagini Mara Veneer & Saw Mills P. Ltd. 219 ITR 527. The facts of the case are different. In this case the notice was issued by Dy. CIT and not by ITO. The Act as it stood then empowered only ITOs of Class-1 to issue notice u/s 148. Thus the notice issued by Dy. CIT came to be challenged. The HC held that the department could not show from the records that ACIT or DCIT was appointed by the Central Govt., as envisaged under the law. The ratio of this case is not at all connected to the present set of facts. The HC of Delhi in the case of Abhishek Jam (2018) 94 taxmann.com 355 (Del) held that as per section 124(3)(b) assessee could not call-in question jurisdiction of an AO after expiry of one month from date of a service of reassessment notice upon him. In this case the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner's place of work. 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 income accruing, arising or received in that area over which the assessing officer exercises jurisdiction. However, notwithstanding Section 124(5), the Act does not postulate multiple assessments by different assessing officers, or assessment of part or portion of an income [see Kanji mal & Sons v. CIT [1983112 Taxman 34/119821 138 ITR 391 (Delhi)J. Thus, it is necessary that the Assessing Officers having concurrent jurisdiction ensure that only one of them proceeds and adjudicate. This is the purport and objective behind sub- section (2) to Section 124 of the Act." The facts of the case being similar, the assessee is precluded from raising any objection with regard to jurisdiction after one month of filing the return u/s 148. iii. As regards the estimation of income, the assessee never furnished any information before the AO and hence the AO was justified in treating the entire cash deposit as unexplained money u/s 69A. The assessee filed another set of returns for AYs 2012-13 to 2014-15 where income from b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing Officer. 10. It is the submission of the learned counsel for the assessee that though the returns showing business income of the proprietary concern namely, M/s. Sri Sai Consultancy were filed after the issuance of notice u/s 148 of the Act, however, these are filed before the completion of the assessment made by the Assessing Officer u/s 144 r.w.s. 147 of the Act on 21.12.2017. It is also the submission of the learned counsel for the assessee that the entire deposits cannot be added u/s 69A of the Act and some reasonable estimation of profit should be adopted. 11. We find from Para 9.1 of the order of ld.CIT(A) that the return of income for A.Y. 2012-13 was filed on 26.08.2016 and the returns for A.Ys. 2013-14 and 2014-15 were filed on 27.08.2016. In the above returns, the income has been offered from proprietary concern namely, M/s. Sri Sai Consultancy. It is also a fact that all these returns were filed before the completion of the assessment on 21.12.2017. Even though the ld.CIT(A) has mentioned that these returns were filed after receiving notice u/s 148 of the Act and that to before a different Assessing Officer, however, there is nothing on record to suggest that t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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