2023 (10) TMI 647 - AT - Income Tax

Transfer of Jurisdiction Dispute under Income-tax Act: Kolkata to New Delhi

The case involved a jurisdictional issue regarding the transfer of jurisdiction from Kolkata to New Delhi for assessment proceedings under the Income-tax ... Transfer of jurisdiction under Section 127 - assumption of jurisdiction without authority - ab initio lack of jurisdiction to pass assessment - no concurrent proceedings before different assessing officers without transfer - challenge to jurisdiction and time-bar under Section 124(3)(a) - participation/consent by assessee does not confer jurisdictionTransfer of jurisdiction under Section 127 - assumption of jurisdiction without authority - ab initio lack of jurisdiction to pass assessment - no concurrent proceedings before different assessing officers without transfer - Validity of the assessment order passed by the Assessing Officer at Kolkata after jurisdiction had been transferred to New Delhi under Section 127. - HELD THAT: - The Tribunal upheld the factual finding of the Commissioner(Appeals) that an order under Section 127 transferring the case from ITO, Ward-5(3), Kolkata to DCIT, Central Circle-8, New Delhi was passed on 30.01.2014 and took immediate effect. Subsequent show-cause and revisionary proceedings under Section 263, and the assessment purportedly giving effect to that revision, were undertaken by the erstwhile Kolkata officer after the transfer. In the absence of any order reverting jurisdiction to the Kolkata officer, there could not lawfully be two concurrent proceedings by different Assessing Officers in respect of the same case. The assessment order passed by the Kolkata Assessing Officer on 02.03.2015 was therefore held to have been made without jurisdiction and was quashed. The Tribunal found the chronology and documentary evidence support the Commissioner(Appeals)'s conclusion and declined to disturb it. [Paras 4, 9]Assessment order passed by ITO, Ward-5(3), Kolkata on 02.03.2015 quashed for lack of jurisdiction after transfer under Section 127.Challenge to jurisdiction and time-bar under Section 124(3)(a) - participation/consent by assessee does not confer jurisdiction - Whether the assessee was precluded from challenging jurisdiction because it did not raise the objection within the time prescribed by Section 124(3)(a) or because it had participated in proceedings. - HELD THAT: - The Tribunal rejected the Revenue's contention that the assessee's challenge to jurisdiction was barred by Section 124(3)(a) since the preliminary requirement that the Assessing Officer be properly vested with jurisdiction under Section 120(1) and (2) was not satisfied in the present facts. The Tribunal accepted the Commissioner(Appeals)'s reasoning that a transfer under Section 127 divested the Kolkata officer of jurisdiction, and that mere participation by the assessee in proceedings cannot confer jurisdiction on an officer who has been divested of it. The Tribunal also noted the decision relied upon by Revenue was distinguishable on facts because it did not involve a Section 127 transfer. [Paras 6, 9]Revenue's reliance on Section 124(3)(a) and on the assessee's participation was rejected; the jurisdictional challenge was entertained and upheld.Final Conclusion: The Tribunal dismissed the Revenue's appeal and upheld the Commissioner(Appeals)'s order quashing the impugned assessment for want of jurisdiction in light of the earlier transfer of the case under Section 127; the Revenue's contention based on Section 124(3)(a) and the assessee's participation was rejected as distinguishable or inapplicable on the facts. Issues involved:The judgment deals with the jurisdiction assumed by the authorities below in an appeal against the assessment order passed under Sections 144/263/143(3)/147 of the Income-tax Act, 1961 for assessment year 2009-10.Jurisdiction Issue:The sole issue in this appeal pertains to the jurisdiction assumed by the authorities below. The case involved the transfer of jurisdiction from Kolkata to New Delhi and subsequent assessment proceedings conducted by the officer of the erstwhile jurisdiction.Facts:The case involved the filing of the return of income, reopening under Section 148, and completion of assessment under Section 147 read with Section 143(3). The jurisdiction was transferred from Kolkata to New Delhi under Section 127(2), followed by revisionary proceedings under Section 263 and the assessment order passed under Sections 144/263/143(3)/147.Assessee's Contentions:The assessee contended that the Assessing Officer lacked jurisdiction to pass the impugned order. The chronological events and documentary evidence supported the claim that the assessment order was passed without valid jurisdiction.Commissioner's Findings:The Commissioner of Income-Tax(Appeals) quashed the assessment order, citing the lack of valid jurisdiction. The order under Section 127 transferring jurisdiction was not reverted, and the proceedings should have been transferred to the appropriate jurisdiction as per the law.Tribunal's Decision:The Tribunal upheld the Commissioner's order, emphasizing the transfer of jurisdiction and subsequent proceedings conducted by the officer of the erstwhile jurisdiction. The Tribunal dismissed the Revenue's appeal, noting the lack of jurisdiction and distinguishing the case cited by the Revenue.This summary provides a detailed overview of the jurisdictional issue and the findings of the authorities involved in the legal judgment.