Tribunal rules CIT(A)'s order incompetent under Section 264, cancels and disregards other arguments.

The Tribunal allowed the appeal, stating that the CIT(A)'s order was incompetent due to the order passed under Section 264. The Tribunal canceled the CIT(A)'s order and did not consider other contentions.

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Issues Involved:
1. Jurisdiction of CIT(A) Jalpaiguri.
2. Denial of exemptions under Section 11 due to late filing of return.
3. Maintainability of the petition under Section 264.
4. Summary dismissal of the appeal by CIT(A).
5. Confirmation of the assessment order by CIT(A).
6. Merger of the assessment order with the order under Section 264.
7. Withdrawal of the appeal filed before CIT(A).

Detailed Analysis:

1. Jurisdiction of CIT(A) Jalpaiguri:
The assessee argued that the CIT(A) Jalpaiguri had no jurisdiction to decide the appeal as it was initially filed before CIT(A) XIV Kolkata, as directed by the AO in the demand notice under Section 156. The Tribunal agreed with the assessee, stating that the CIT(A) Jalpaiguri should not have exercised jurisdiction over the appeal.

2. Denial of Exemptions under Section 11:
The CIT(A) erred in holding that the late filing of the return automatically resulted in the denial of exemptions under Section 11 of the Income Tax Act. The Tribunal noted that the assessee filed the return within the due date under Section 139(1) and a revised return on 27.03.2009, which should not have led to the denial of exemptions.

3. Maintainability of the Petition under Section 264:
The CIT(A) held that the petition under Section 264 was not maintainable as an appeal against the assessment order was pending. The Tribunal, however, referred to the CBDT Circular No. 367, which clarifies that an order cannot be said to be the subject of an appeal if the appeal has been disposed of without passing an order under Section 251(1) or 254(1) on merits. The Tribunal concluded that the CIT(A) should not have questioned the maintainability of the application under Section 264.

4. Summary Dismissal of the Appeal by CIT(A):
The CIT(A) dismissed the appeal summarily without deciding the grounds of appeal on merit, which was in contravention of the provisions of Section 250(6) of the Income Tax Act. The Tribunal emphasized that the CIT(A) should have addressed the grounds of appeal on their merits rather than dismissing the appeal summarily.

5. Confirmation of the Assessment Order by CIT(A):
The CIT(A) confirmed the assessment order passed by the AO. The Tribunal found this to be erroneous, given that the order of the AO had already been revised by the DIT(E) under Section 264, rendering the appeal before CIT(A) incompetent.

6. Merger of the Assessment Order with the Order under Section 264:
The Tribunal highlighted that once the DIT(E) passed an order under Section 264, the original assessment order ceased to exist and merged with the order under Section 264. Therefore, the CIT(A) should not have proceeded with the appeal as the assessment order had already been revised.

7. Withdrawal of the Appeal Filed before CIT(A):
The Tribunal addressed the issue of whether the assessee could withdraw the appeal filed before CIT(A). It concluded that this issue became academic since the appeal itself was rendered incompetent due to the order passed under Section 264. Therefore, the Tribunal held that the CIT(A) should have allowed the withdrawal of the appeal.

Conclusion:
The Tribunal allowed the appeal of the assessee, stating that the order passed by CIT(A) was incompetent and superfluous in light of the order passed under Section 264. The Tribunal canceled the order of CIT(A) and did not consider the other contentions put forth.

Order Pronounced:
The order was pronounced in the Court on 08.07.2016.

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