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TMI Blog2024 (6) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... of an AO in the case of the assessee. When the jurisdiction of the Addl. CIT to conduct scrutiny assessment and pass the assessment order under the Act is under challenge, the Revenue is under an obligation to bring on record the copy of the aforesaid order(s) to justify the basis of authority of the Addl. CIT to perform the functions, and exercise the powers of an Assessing Officer and pass the assessment order. Thus, apart from the sole statement in the intimation letters dated 13/08/2009 and 11/08/2010 as well as draft and final assessment order for the assessment year 2007 08, the Revenue has failed to produce any such order. Time limit for raising objection to the jurisdiction of the AO - As regards the submission of the learned DR that as per the provisions of section 124(3) of the Act, any challenge to the jurisdiction of the AO can be raised within a period of one month, we find that in Bansilal B. Raisoni Sons [ 2018 (12) TMI 223 - BOMBAY HIGH COURT ] held that the time limit for raising objection to the jurisdiction of the Assessing Officer prescribed under sub-section (3) of section 124 has a relation to Assessing Officer s territorial jurisdiction and the said time limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espect of the aforesaid issue, are in Part-B of the Exhibit-E, of the aforesaid consolidated application and the same are reproduced as under:- B-1 On the facts and in the circumstances of the case, the assessment order dated 28.10.2011 passed by the Additional Commissioner of Income Tax under section 143(3) is bad in law, illegal and without jurisdiction and/ or in excess of jurisdiction, on the grounds amongst others, that he failed to establish that he possessed legal and valid jurisdiction under the Act to pass the assessment order and consequently the Hon'ble Tribunal be pleased to quash the said order. B-2 The Additional Commissioner of Income Tax lacked jurisdiction to pass the Order of Assessment u/s 143(3) dated 28.10.2011 and to exercise the power of performing the functions of an Assessing Officer, without establishing that he possess such jurisdiction conferred on him under section 120(4)(b) of the Act. Accordingly, in the absence of an order u/s 120(4)(b) conferring jurisdiction on the Additional Commissioner of Income Tax, the assessment order dated 28.10.2011 passed by him needs to be quashed. B-3 The proceedings having been initiated by issue of a Notice u/s 143 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Range-2(3), Mumbai, informing that the assessee s case has been assigned to him by the CIT-2, Mumbai, vide assignment order dated 05/08/2010, for completion of the assessment for the assessment year 2007-08. On the same date, i.e. 11/08/2010, notice under section 142(1) of the Act was issued by the Addl. CIT, Range-2(3), Mumbai. Copy of the aforesaid documents form part of the paper book filed by the assessee having pages 1-15. The Addl. CIT, Range-2(3), Mumbai, passed the draft assessment order on 24/12/2010 and impugned final assessment order on 28/10/2011. 5. The learned Sr. Counsel by referring to the provisions of section 143(2) as well as section 143(3) of the Act submitted that only the Assessing Officer can ask for the details from the assessee to complete the scrutiny assessment and pass the assessment order. Further, it was submitted that under section 2(7A) of the Act, the Addl. CIT can act as an Assessing Officer, provided the PCCIT or CCIT or another officer mentioned has issued any order under section 120(4)(b) of the Act in pursuance of the authorisation given by the CBDT either by general or special order. Thus, two orders are contemplated under section 120(4)(b) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted that in NTPC Ltd. (supra), the issue was determination of tax liability and all the facts were available on record, unlike in the present case. It was submitted that the assessee participated in the assessment proceedings before the Transfer Pricing Officer/Assessing Officer/DRP, however, did not raise any objection regarding the jurisdiction of the Assessing Officer. Even the appeal for the assessment year 2007-08 was filed by the assessee on 23/12/2011, wherein this ground was not raised by the assessee. Thus, it was submitted that if the Assessing Officer does not have the jurisdiction then why the assessee participated in all the assessment proceedings. The learned DR further submitted that the assessee filed the aforesaid additional grounds on the basis of the decision of the coordinate bench in Mega Corporation Ltd v/s the Addl. CIT, [2015] 155 ITD 1019 (Del.), which has been reversed by the Hon ble Delhi High Court, and thus the additional grounds raised by the assessee are without any basis. 7. In rebuttal, the learned Sr. Counsel submitted that mere admission of appeal cannot alter the decision rendered by the Tribunal, as there is no stay of operation of the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt observed as under: Undoubtedly, the Tribunal will have the discretion to allow or not allow a new ground to be raised. But 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. 9. Thus, in the aforesaid decision, the Hon ble Supreme Court held that legal issues can be raised for the first time before the Tribunal, so long as the relevant facts are on record in the assessment proceedings for that issue. As per the Revenue, the existence or otherwise of the jurisdiction of the Addl. CIT to pass the assessment order is a question of fact and to ascertain that fact the documents, i.e. the order passed under section 120(4)(b) or section 127 of the Act, need to be called for. Therefore, the precondition as laid down by the Hon ble Supreme Court in NTPC Ltd. (supra) is not satisfied in the present case. We, at the outset, are not in a position to persuade ourselves to agree with the aforesaid submission of the Revenue, as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td. (supra). Thus, we find no basis in the submission of the Revenue that since the assessee has participated in the assessment proceedings before the Transfer Pricing Officer, Assessing Officer, and DRP, without raising any ground challenging the jurisdiction of the Addl. CIT in passing the assessment order, no such ground can be raised before the Tribunal for the first time. 11. As regards the decision in Ultratech Cements Ltd v/s Addl. CIT, [2018] 408 ITR 500 (Bom.), relied upon by the Revenue, we find that following question of law arose for consideration of the Hon ble jurisdictional High Court:- Whether on the facts and in the circumstances of the case and in law, the Tribunal erred in refusing to admit the additional ground of the appellant of claim of deduction under Section 80IA of the Act on the income earned by the Appellant on operation and maintenance of the Jetty / Port? 12. Therefore, from the above, it is evident that the additional ground of appeal raised by the taxpayer before the Tribunal was not pertaining to any challenge against the invocation of jurisdiction under the Act, and rather the same pertains to claim of deduction under section 80-IA of the Act. Acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reversed in appeal, the same is a binding precedent, and mere pendency of the appeal does not affect the binding nature of the decision. In this regard, we find support from the decision of the Hon ble jurisdictional High Court in Siemens India Ltd. vs. ITO, [1983] 143 ITR 120 (Bom.), wherein it was held that merely because an appeal has been filed or a special leave application is pending against it does not denude a decision of its binding effect, and until set aside, that decision is binding on all upon whom it operates as a binding precedent, unless where the operation of that judgment has been stayed. Therefore, we find no merits in the aforesaid submission of the learned DR and mere pendency of the appeal does not impede against the admission of similar additional grounds of appeal, in the absence of stay or reversal of the Tribunal s earlier order. It is pertinent to note that mere admission of appeal and formulation of substantial questions of law cannot be treated as doubting the correctness of the decision rendered by the coordinate bench of the Tribunal. By formulating the substantial questions of law, the Hon ble High Court has merely framed the issues on which the Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se (b) of sub-section (4) of that section to exercise or perform all or any of the powers and functions conferred on, or assigned to, an Assessing Officer under this Act. (Emphasis supplied) 17. Thus, as per the provisions of section 2(7A) of the Act, the Addl. CIT can exercise the powers of the Assessing Officer under the Act if the direction in this respect has been issued under section 120(4)(b) of the Act. As per section 120(4)(b) of the Act, CBDT may by general or special order empower the authorities mentioned under the provision to issue orders in writing that the powers and functions assigned to the Assessing Officer shall be exercised or performed, inter-alia, by the Addl. CIT. Section 120(4)(b) of the Act reads as under:- (4) Without prejudice to the provisions of sub-sections (1) and (2), the Board may, by general or special order, and subject to such conditions, restrictions or limitations as may be specified therein, (a) ....... (b) empower the Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner to issue orders in writing that the powers and functions conferred on, or as the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer only within a period of one month after the receipt of notice under section 142(1) or section 143(2) or after the completion of the assessment, whichever is earlier. However, no such objection was raised by the assessee, and therefore the challenge to jurisdiction now raised by the assessee is barred by limitation as provided under section 124(3) of the Act. 20. From the perusal of the documents placed on record by the assessee, we find that vide letter dated 22/11/2022, the assessee requested the Revenue to provide the copy of assignment orders dated 03/08/2009 and 05/08/2010 as referred to in the aforesaid intimation letters dated 13/08/2009 and 11/08/2010. Thereafter, again on 24/08/2023, the assessee requested the Revenue to provide the copy of aforesaid assignment orders. Vide aforesaid letter dated 24/08/2023, the assessee also requested the Revenue to provide the orders, if any, passed under section 127 of the Act transferring the case to/from the DCIT to/from the Addl. CIT. However, in its written submission dated 18/01/2024, the learned DR stated as follows:- 7. Since the matter is very old, it has not been possible to produce the order of the Commissioner of Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the contention of the Counsel for the petitioner that the petitioner's objection to the jurisdiction of the Assessing Officer on the ground that if no search was initiated, notice under Section 153A of the Act could not have been issued, cannot be curtailed on the ground that such objection was raised beyond the period referred to in sub-section (3) of Section 124 of the Act. Section 124 of the Act pertains to jurisdiction of Assessing Officers. Sub-section (1) of Section 124 lays down territorial jurisdiction of the Assessing Officer. Sub-section (2) of Section 124 provides that where the question arises under said section, as to whether an Assessing Officer has jurisdiction to assess any person, such question shall be determined by the authority prescribed under the said sub-section. Sub-section (3) of section 124 provides time limits for a person to call in question jurisdiction of an Assessing Officer. Clause (c) of sub-section (3) of section 124 provides that no person shall be entitled to call in question jurisdiction of an Assessing Officer where an action has been taken under Section 132 or section 132A, after the expiry of one months from the date on which he was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regarding transfer and posting of officers has not been complied with, dismissed the same. However, it is evident that in the present case, the Revenue despite specific request from the assessee, failed to furnish the assignment order and have admitted in its written submissions, para 7 and para 12(iv), that it is not possible to produce the order of the Commissioner of Income Tax authorising the Addl. CIT to act as an Assessing Officer and pass the assessment order. Therefore, we are of the considered view that the decision in Stock Traders Pvt. Ltd. (supra) has been rendered in its own facts, which are different from the present case, and thus does not support the case of the Revenue. Further, we find that the coordinate bench of the Tribunal in Vertiv Energy Pvt Ltd. v/s Addl. CIT, ITA No.1975/Mum./2014 and M/s Tata International Ltd. v/s Addl. CIT, in ITA No. 1605/Mum./2012, after considering the decision in Stock Traders Pvt. Ltd. (supra), decided similar issue in favour of the taxpayer. In any case, as noted in the foregoing paragraph, Revenue s appeal is pending consideration before the Hon ble jurisdictional High Court in Principal CIT v/s M/s Tata Sons Ltd., in ITA No. 140 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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