2019 (9) TMI 899 - AT - Income Tax

Invalid Assessment Order Quashed Due to Jurisdictional Errors

The Tribunal found jurisdictional errors in the assessment process due to the notice being issued by an incorrect Assessing Officer and subsequent ... Reopening of assessment u/s 147 - jurisdiction of AO - As alleged notice has been issued by some other Assessing Officer and the assessment has been framed by a different Assessing Officer whereas the jurisdiction of the assessee lies with another Assessing Officer - HELD THAT:- Reasons recorded for reopening the assessment were recorded by the Income-tax Officer, Ward 29(3), New Delhi whereas the return was filed with the Income-tax Officer, Ward 39(4), New Delhi with whom the jurisdiction lies. Once again, disregarding the contents of the letter, objections were disposed of by the Income-tax Officer, Ward 29(3), New Delhi vide order dated March 29, 2015. This order is placed at pages 10 to 12 of the paper book. Without affording any opportunity of being heard to the assessee to contemplate any further legal proceedings, assessment order was framed under section 144 of the Act vide order dated March 30, 2015 and assessment has been framed by the Income-tax Officer, Ward 63(4), New Delhi. These undisputed facts clearly reveal that the notice has been issued by some other Assessing Officer and the assessment has been framed by a different Assessing Officer whereas the jurisdiction of the assessee lies with another Assessing Officer. Thus we hold that the assessment order dated March 30, 2015 framed under section 144 read with section 147 of the Act is bad in law and deserves to be quashed. See SMT. KAMLESH GOEL VERSUS THE I.T.O, WARD 59 (3) , NEW DELHI [2018 (9) TMI 102 - ITAT DELHI] - Decided in favour of assessee. Issues:1. Jurisdictional error in assessment due to notice issued by incorrect Assessing Officer.2. Validity of assessment under section 144 of the Income-tax Act, 1961.Issue 1: Jurisdictional error in assessment due to notice issued by incorrect Assessing Officer:The appeal was against the Commissioner of Income-tax (Appeals) order confirming the assessment for the assessment year 2009-10. The main grievance was that the notice issued under section 148 of the Income-tax Act, 1961, and subsequent proceedings were challenged as being bad in law due to the absence of reasons recorded by the Assessing Officer with jurisdiction over the case. The assessee filed the return with a specific Income-tax Officer, but the notice for reassessment was issued by a different Assessing Officer. Despite objections raised by the assessee, the assessment was conducted by yet another Assessing Officer. The objections were disposed of without granting an opportunity for further legal proceedings. The Tribunal referred to a similar case where it was held that the Assessing Officer should have allowed time for the assessee to seek legal remedies after rejecting objections. Based on this precedent, the Tribunal concluded that the assessment order was bad in law and deserved to be quashed.Issue 2: Validity of assessment under section 144 of the Income-tax Act, 1961:The assessment order under section 144 was challenged on the grounds of jurisdictional error and procedural irregularities. The Tribunal found that the notice was issued by one Assessing Officer, objections were disposed of by another, and the assessment was conducted by a different Assessing Officer, all while the jurisdiction of the assessee lay with a specific Income-tax Officer. Citing a previous case, the Tribunal emphasized the importance of granting the assessee time to seek legal remedies after objections were rejected. As the assessment order was passed within a short period after rejecting objections and without following due process, the Tribunal held the assessment order to be bad in law and ordered it to be quashed. Consequently, the appeal filed by the assessee was allowed, and the assessment order was deemed invalid.This detailed analysis of the judgment highlights the key issues of jurisdictional errors in assessment and the validity of the assessment order under section 144 of the Income-tax Act, 1961. The Tribunal's decision was based on procedural irregularities and failure to grant the assessee an opportunity for legal remedies, leading to the quashing of the assessment order.