Revenue Appeal Accepted: Legal Questions Raised on Assessing Officer's Jurisdiction Under Income Tax Act, 1961.

The High Court of Calcutta admitted the revenue's appeal to address substantial legal questions regarding the jurisdiction of the Assessing Officer under Section 124(3)(a) of the Income Tax Act, 1961. The Court questioned the Tribunal's decision to quash the assessment order, given the assessee's participation in proceedings without timely jurisdictional objections. The Court directed the appellant to submit necessary documents and allowed future hearing requests post-filing. The stay application was closed.

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Issues: Interpretation of Section 124(3)(a) of the Income Tax Act, 1961

Analysis:

The judgment by the High Court of Calcutta involves the interpretation of Section 124(3)(a) of the Income Tax Act, 1961. The Tribunal allowed the assessee's appeal, contending that the assessment by the ACIT was without jurisdiction, citing violation of CBDT instructions. The revenue appealed, arguing that the assessee cannot raise this point due to the embargo under Section 124(3)(a) of the Act. The standing Counsel relied on the decision in Deputy Commissioner of Income-tax vs. Kalinga Institute of Industrial Technology, while the senior Counsel cited the decision in Principal Commissioner of Income Tax-2, Kolkata Vs. M/s. Cosmat Traders Pvt. Ltd. and another case for their respective positions.

The key question in this case revolves around whether the assessee can challenge the jurisdiction of the Assessing Officer after the expiry of 30 days from the service of the notice under Section 142(1) of the Act. The Court admitted the appeal to consider substantial questions of law, including whether the Tribunal was justified in quashing the assessment order under Section 143(3) on the ground of a defective notice under Section 143(2). The Court also questioned whether the Tribunal's decision ignored the fact that the assessee participated in the assessment proceedings without raising the jurisdictional issue within the specified time frame under Section 124(3)(a).

Furthermore, the Court examined whether the Tribunal erred in quashing the assessment order without considering the precedent set by the Supreme Court in DCIT (Exemption) Vs. Kalinga Institute of Industrial Technology, which emphasized the preclusion of the assessee from questioning the Assessing Officer's jurisdiction if not raised within the stipulated period. The Court directed the appellant to file necessary documents within a specified timeline and waived the service of notice on the respondent's Advocates, with liberty to request a hearing after the completion of filing the paper book. The stay application was closed as well.

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