Revenue appeal dismissed for improper jurisdiction as assessee maintained Kolkata address throughout proceedings

The ITAT Gauhati dismissed the revenue's appeal due to improper jurisdiction. The assessee consistently maintained its address in Kolkata, and the assessment order was passed by ITO Ward-9(2), Kolkata. No proper transfer of the case from Kolkata to Gauhati jurisdiction was established per statutory provisions. Citing precedents from Punjab & Haryana HC and Bombay HC, the tribunal found the appeal was filed in wrong jurisdiction. Revenue was granted liberty to file fresh appeal before appropriate ITAT bench with jurisdiction over the assessee, along with condonation petition for delay.

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Issues Involved:
1. Deletion of addition u/s 68 of the Income-tax Act, 1961 regarding unexplained cash credits.
2. Jurisdiction of the ITAT Gauhati Bench to hear the appeal.

Summary:

Issue 1: Deletion of Addition u/s 68 of the Income-tax Act, 1961

The revenue challenged the order of the Ld. CIT(A), Central NER, Guwahati, which deleted the addition of Rs. 2,25,00,000/- made by the Assessing Officer (AO) under the head of unexplained cash credits u/s 68 of the Income-tax Act, 1961. The AO had treated the amount as unexplained credit due to the assessee's failure to establish the genuineness of share capital including share premium raised during the year. The AO's assessment was based on non-compliance with statutory notices and summons issued u/s 143(2), 142(1), and 131 of the Act. The Ld. CIT(A) allowed the appeal of the assessee by elaborately dealing with the grounds raised and noting the position of addresses of the assessee on various documents.

Issue 2: Jurisdiction of the ITAT Gauhati Bench

The revenue filed an appeal before the Gauhati Bench of ITAT after obtaining authorization u/s 253(2) from the office of Ld. Pr. CIT, Central, Gauhati. However, the ITAT noted that the impugned assessment order was passed by the AO located at Kolkata, which falls outside the jurisdiction of the ITAT Gauhati Bench. The Tribunal referred to the recent decision of the Hon'ble Supreme Court in the case of PCIT Vs. ABC Papers Ltd. (2022) 141 taxmann.com 332 (SC), which held that the appropriate High Court for disposal of the appeal would be the one where the case was assessed by the AO. Further, the Tribunal cited the judgment of the Hon'ble High Court of Bombay in the case of MSPL Ltd. Vs. PCIT & Ors, which clarified that the President of the Tribunal does not have the power to transfer a pending appeal from one bench to another bench outside the headquarters in a different state.

Considering these judgments, the ITAT concluded that the appeal was filed under improper jurisdiction. Consequently, the appeal was dismissed with the liberty to the revenue to file a fresh appeal before the appropriate bench of the Tribunal having jurisdiction over the assessee, along with a petition for condonation of delay caused on this account.

Conclusion:

The appeal of the revenue was dismissed due to improper jurisdiction, with the liberty to refile before the appropriate bench. The decision emphasized the importance of jurisdictional compliance in filing appeals.

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