Jurisdictional defect leads to orders being set aside by Tribunal

The Tribunal found that the Commissioner of Income Tax (Appeals)-11 lacked jurisdiction to pass orders after specific directions were issued, leading to a jurisdictional defect. Additionally, the Tribunal noted the possibility of backdating orders, supported by evidence of omissions in the dispatch register. Consequently, the Tribunal set aside the orders, directing a fresh decision by the respective jurisdictional Commissioner of Income Tax (Appeals) in compliance with the law. Citing the principle that jurisdictional defects invalidate court decrees, all appeals and cross objections were allowed for statistical purposes.

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Issues Involved:
1. Jurisdiction of the Commissioner of Income Tax (Appeals)-11 in passing the impugned orders.
2. Allegation of backdating the orders by the Commissioner of Income Tax (Appeals)-11.

Detailed Analysis:

1. Jurisdiction of the Commissioner of Income Tax (Appeals)-11:

The Revenue raised an additional ground questioning the jurisdiction of the Commissioner of Income Tax (Appeals)-11 (CIT(A)-11) in passing the impugned orders. They argued that the orders were passed after the CIT(A)-11 was directed by the Director General of Income Tax (Investigation), Karnataka & Goa, Bengaluru, on 18/06/2018, not to pass any further appellate orders due to certain lapses in adjudicating the appeals. Furthermore, a notification dated 16/07/2018 issued under section 120 of the Income Tax Act by the Principal Chief Commissioner of Income Tax, Karnataka & Goa, transferred the jurisdiction of pending appeals from CIT(A)-11 to CIT(A)-12. The Revenue contended that the CIT(A)-11 passed the impugned orders disregarding these directions and notifications, rendering the orders without jurisdiction and liable to be set aside.

The Tribunal considered the submission that the CIT(A)-11 had no jurisdiction to pass any orders in appeal after 18/06/2018. The Tribunal noted that the impugned orders were passed between 05/07/2018 and 13/07/2018, which was after the direction from the Director-General. The Tribunal emphasized that the instructions from the CBDT are binding on all income tax officials, and non-compliance with these directions prejudices the revenue.

2. Allegation of Backdating the Orders:

The Revenue also alleged that the impugned orders, purported to have been passed before 16/07/2018, were actually backdated to fall before the cut-off date. They supported their claim by pointing out that the date of dispatch of the impugned orders was not entered in the dispatch register maintained by CIT(A)-11. The Revenue argued that this omission indicates that the orders were passed after the jurisdiction was transferred to CIT(A)-12 and were backdated to appear as if they were passed before the transfer.

The Tribunal noted the Revenue's contention and the offer to submit prima facie material in a sealed cover to support the allegation of backdating. Although the Tribunal declined to look into the sealed material, it found the Revenue's claim probable given the conduct of CIT(A)-11. The Tribunal highlighted the difficulty of passing around 50 orders involving different assessees and issues within a short period, suggesting a serious lapse on the part of CIT(A)-11.

Conclusion:

The Tribunal, considering the jurisdictional defect and the probable backdating of orders, set aside the orders of CIT(A)-11. It directed the respective jurisdictional CIT(A) to decide the appeals afresh in accordance with the law after providing due opportunity of hearing to the parties. The Tribunal relied on the principle established by the Hon'ble Supreme Court that jurisdictional defects strike at the very authority of the court to pass any decree, rendering such orders nullities. Consequently, all the appeals and cross objections were allowed for statistical purposes.

Pronouncement:

The judgment was pronounced in the open court, and the appeals and cross objections were treated as allowed for statistical purposes.

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