2023 (7) TMI 613 - AT - Income Tax

Appeals Dismissed for Jurisdictional Reasons at ITAT Kolkata

The appeals were dismissed for statistical purposes as not maintainable before ITAT Kolkata due to jurisdictional issues. The parties were given two ... Appellate jurisdiction determined by location of the Assessing Officer - power of the President of the ITAT to transfer appeals between headquarters - territorial maintainability of appeals before the Income Tax Appellate Tribunal - procedure of Appellate Tribunal and Rule 4 of the Tribunal Rules - exclusion of time consumed before wrong forum from limitationAppellate jurisdiction determined by location of the Assessing Officer - territorial maintainability of appeals before the Income Tax Appellate Tribunal - Appeals filed before ITAT Kolkata are not maintainable because the Assessing Officer is located at Indore, and appellate jurisdiction lies at the Benches where the Assessing Officer is situated. - HELD THAT: - The Tribunal examined the situs of the Assessing Officer and the principles governing territorial jurisdiction of the ITAT. Relying on the position that the appellate jurisdiction ordinarily follows the location of the Assessing Officer, and after referring to relevant judicial exposition on transfer powers, the Bench concluded that appeals pertaining to the assessment years in question fall within the jurisdiction of the Indore Benches since the Assessing Officer who passed the assessment orders was situated at Indore. Consequently, appeals before the ITAT Kolkata were held not maintainable in the present form. [Paras 4]Appeals dismissed for statistical purposes as not maintainable before ITAT Kolkata; parties may approach the competent Bench at Indore.Power of the President of the ITAT to transfer appeals between headquarters - procedure of Appellate Tribunal and Rule 4 of the Tribunal Rules - exclusion of time consumed before wrong forum from limitation - The President (or Tribunal administration) cannot, in law, transfer pending appeals from one headquarters to another State/zone in a manner that ousts territorial jurisdiction; parties are permitted to refile at the competent Bench and time spent before the wrong Bench is to be excluded for limitation. - HELD THAT: - After considering authorities and the scope of Rule 4 and related Tribunal Rules, the Bench observed that the power to transfer under those provisions is confined to transfers between Benches within the same headquarters and does not extend to transferring live appeals across different headquarters/states. Having found the appeals maintainable only before Indore, the Tribunal nonetheless protected parties from prejudice by allowing the assessee and the revenue liberty to approach ITAT Indore and directing that the period consumed litigating at Kolkata benches be excluded from limitation, noting historical practice and recent authoritative clarifications on transfers. [Paras 3, 4]Directions that parties may file appeals before ITAT Indore within two months of this order and that time spent litigating at Kolkata shall be excluded from limitation.Final Conclusion: The Tribunal held that the appeals relating to Assessment Years 2008-09, 2009-10 and 2010-11 are not maintainable before the ITAT Kolkata because appellate jurisdiction lies at Indore where the Assessing Officer is situated; the orders are dismissed for statistical purposes, parties may approach ITAT Indore and the period spent before the wrong bench shall be excluded for limitation. Issues Involved:1. Jurisdiction of the Tribunal2. Transfer of Appeals3. Validity of Appeals before ITAT KolkataSummary:Jurisdiction of the Tribunal:The core issue pertains to the jurisdiction of the Tribunal to hear the appeals. The assessment order was passed by the Assistant Commissioner of Income Tax, Circle-5(1), Indore, indicating that jurisdiction over the assessee lies in Indore. The appellate jurisdiction of the Tribunal, as well as the Hon'ble High Court, rests at Indore, as per the judgment of the Hon'ble Supreme Court in the case of Principal Commissioner of Income-tax vs. ABC Papers Ltd. and the Hon'ble Bombay High Court in the case of MSPL Limited vs. PCIT. The President of ITAT does not have the power to transfer appeals between different headquarters.Transfer of Appeals:The Tribunal examined the power of the President of ITAT under section 255 of the Income Tax Act and rule 4 of the Tribunal Rules. The Hon'ble Bombay High Court clarified that the President can only transfer appeals within the same headquarters and not to a different state or zone. The power to regulate its own procedure and the procedure of the Benches does not extend to transferring appeals across states. The Tribunal also noted that the convenience of the parties is not a valid ground for transferring cases out of a state.Validity of Appeals before ITAT Kolkata:The appeals were initially filed before the ITAT Kolkata Bench. However, as the jurisdiction lies in Indore, these appeals are deemed not maintainable before the ITAT Kolkata. The Tribunal observed that prior to the decision of the Hon'ble Bombay High Court, the President used to transfer appeals across Benches on request, but this practice has been recently clarified and restricted. Therefore, the parties are given two months to approach the ITAT Indore Bench, and the period consumed in litigating at Kolkata benches will be excluded from the period of limitation.Conclusion:In conclusion, the appeals were dismissed for statistical purposes as not maintainable before the ITAT Kolkata. The assessee and the revenue are at liberty to approach the competent authority at Indore. The order was pronounced in the Court on 13th July, 2023, at Kolkata.