2005 (7) TMI 686 - AT - Income Tax

Tribunal cancels protective assessment for lack of jurisdiction under Income-tax Act, 1961

The Tribunal canceled the protective assessment made by the Assessing Officer, ruling it invalid due to lack of jurisdiction under section 124 of the ... - Issues:Jurisdictional challenge regarding assessment on protective basis without jurisdiction under section 124 of the Income-tax Act, 1961.Analysis:The appellant contested the assessment made on a protective basis by the Assessing Officer, claiming it was without jurisdiction. The case involved the receipt of information alleging the appellant's involvement in bogus long-term capital gains entries. The Assessing Officer, unable to confirm jurisdiction, completed the assessment on a protective basis due to no response from the relevant ITO despite reminders. The CIT (Appeals) upheld the assessment, citing the appellant's filing of the return at Jorhat and losing the right to challenge jurisdiction after the specified period. The appellant argued that the assessment was invalid as he was previously assessed in Jorhat. The Tribunal noted that the appellant questioned the current Assessing Officer's jurisdiction and took a lenient view due to the lack of a provision to condone the minor delay in challenging jurisdiction. The Tribunal canceled the protective assessment, emphasizing that the correct Assessing Officer was already handling the matter, rendering the current assessment baseless under section 124(4) of the Act.The Tribunal's decision to cancel the assessment on legal grounds led to the non-consideration of merit-related grounds in the appeal. Grounds challenging the validity of the notice under section 148 were rejected as they were not pressed during the hearing. Consequently, the appeal was partly allowed, acknowledging the appellant's jurisdictional challenge and canceling the protective assessment.