TaxTMI 
TaxTMI 
2020 (1) TMI 964
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....2008 for a total consideration of Rs. 29,30,000/-. As per the information received by ITO, Ward-2(3), Cuttack from the Investigation Wing of Bhubaneswar, the said land was sold by the assessee on 16.08.2011 to one Shri Pawan Kumar Jajodia, Purighat, Cuttack for a total consideration of Rs. 1,37,00,000/-. Since the said sale of land gave rise to a long-term capital gain liable to tax in the hands of the assessee for the year under consideration i.e. A.Y. 2012-13 and no return of income for the said year was filed by the assessee declaring the said long-term capital gain, the ITO, Ward-2(3), Cuttack had reason to believe that income chargeable to tax in the hands of the assesese was escaped assessment within the meaning of section 147 of the Income Tax Act, 1961. He accordingly reopened the assessment for the year under consideration after recording the reason and a notice under section 148 was issued by him on 30.03.2018. Meanwhile the return of income for A.Y. 2016-17 was filed by the assessee with the address of Midnapore and taking note of the same, the PAN Jurisdiction of the assessee was transferred to the ITO, Ward-38(4), Midnapore on 15.09.2018. The assessment record of the a....
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....only) by Malay Sankar Roy Chowdhury. The settlement was done between Malay Sankar Roy Chowdhury and Paban Kumar. But according to Govt. Rate in that area it was one crore and thirty seven lakh. Sir after buying the land my son had spent about Eight lakh and more for boundary wall and suitable for living of a family. But at the time selling the cost of the land with building was fixed only Rs. Fifty lakh. The purchaser forced my son to say before the Registrar that he had got the said Govt. Rate as value. After sale deed registered the purchaser gave only Rs. Fifteen lakh only and Malay Sankar Roy Chowdhury had taken that rest amount. After that he gave us in eight instalments in three years. Now we are in such a position that we can not start a business within six years. We have lost everything for maintaining my family I cm bagging from door to door. Now it is my earnest prayer to you how shall I serve ourselves from this hard situation. I therefore request you to release me form this pressure, Now we have been living with much difficulty. We are uneducated so we have no means of earnings. Now we have been living only by the grace of God". 3. Keeping in view t....
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....f the assessee in support of this ground were not found acceptable by the ld. CIT(Appeals) and rejecting the same, he dismissed this ground for the following reason given in paragraph no. 8.1 to 8.3 of his impugned order:- "8.1 A close look at the reasons recorded by the ld. AO for reopening the case clearly mentions the verifications made by him. Once he had the information in his possession, he went through the details and cross-checked the facts with the appellant's return of income. He found that the appellant had not furnished his return of income for the AY 2012-13. He also found that the appellant had not filed his return of income right from the AY 2011-12 till the AY 2015-16. He filed his return for the AY 2016-17 with his address at Midnapore. I find that the ld. AO also computed the LTCG involved in this case by calculating the indexed cost of acquisition. Since he already had the details of the transaction undertaken by the appellant along with the sale deed, and since the return of income for the same had not been filed, there remained no further fact to be ascertained in this case. All these facts show that the Id. AO had applied his mind to the facts of ....
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....ount Construction (P) Ltd. [2017] 79 taxmann.com 409 (Delhi) [2017] 329 ITR 444 (Delhi) held that information regarding bogus purchase by assessee received by the DRI from CCE which was passed on to Revenue Authorities was 'tangible material outside record' to initiate valid reassessment proceedings. SLP filed against this decision was dismissed by the Hon'ble Supreme Court. Similarly, in this case too, information supplied by the Directorate of Income Tax (Investigation), Bhubaneshwar, was 'tangible material outside record' and the Ld. AO validly reopened the proceedings u/s 148. 8.2.2 Further, in the case of Pushpak Bullion Pvt. Ltd. vs. DCIT the Gujarat High Court held that where investigation wing of department had during course of investigation in case of a third party found that he had indulged in providing accommodation entries and bogus bills, and assessee had made sizeable purchases from him, reopening notice against assessee was justified. 8.3 In view of the above referred facts and decisions, this argument is rejected and the ground of appeal is dismissed". 6. Another ground raised by the assessee while challenging the validity of....
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....se as above and extracting the relevant provisions of section 120 and section 124 of the Income Tax Act, 1961 in his impugned order, the ld. CIT(Appeals) proceeded to discuss and decide this issue vide paragraph no. 9.3 to 9.11 of his impugned order as under:- "9.3. As is evident from the above referred sections and their provisions, the Income Tax Act does not specify the jurisdiction of the Assessing Officer. It leaves it to the CBDT to assign the same to the assessing officers either own its own motion or through delegation of this power to the Chief Commissioner or Director General or the Commissioner of Income Tax. Thus, the issue of jurisdiction is a matter of administrative decision and is not borne out of the statute. The statue only provides a broader out line in section 120(3). Jurisdiction over a case cannot be assumed suo-moto by the assessing officer. It is conferred on him by an order by the Chief Commissioner of Income Tax or the Director General of Income Tax or, as the case may be, by the Commissioner of Income Tax. In each Region or Charge in the Department of Income Tax, there are clear orders related to jurisdiction of the assessing officer manning each....
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.... and for executing any function, an access to PAN is required. 9.7. Having discussed the provisions of the Act and the administrative issues related to jurisdiction, some more facts related to PAN and jurisdiction need to be discussed. Since the Id. AR had raised serious questions about jurisdiction, in order to bring more facts on record, the ld. AO was directed to conduct further fact findings and send a report in respect of history of returns filed by the appellant and the history of jurisdiction over his PAN. The ld. AO has reported that: The ld. AO's report: 9.7.a. Jurisdiction over PAN: After transferring PAN on 15.09.2018,vide order u/s 127(2) of the IT Act, 1961 dated 14th September 2018 passed by Pr. CIT, Cuttack, ITO Ward 38(4), Midnapore holds the Jurisdiction over the assessee from 15.09.2018 onwards. Before 15.09.2018, the jurisdiction over the assessee was lying with ITO, Wd. 2(3), Cuttack. 9.7.b. As per ITBA PAN Jurisdiction history details, it is revealed that PAN jurisdiction over the assessee before 15.09.2018 had been lying with ITO, Ward 2(3), Cuttack. Consequent upon the order u/s 127 (1) of the IT Act, 1961 dated 14th Se....
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.... under: 124 (5) No person shall be entitled to call in question the jurisdiction of an Income-tax Officer - (a) after the expiry of one month from the date on which he has made a return under sub-section (1) of section 139 or after the completion of the assessment, whichever is earlier; (b) where he has made no such return, after the expiry of the time allowed by the notice under subsection (2) of section 139 or under section 148 for the making of the return. 9.11 In this case, the appellant did not file his return of income in response to the notice u/s 148 of the Act. Therefore, his opportunity to raise an objection on the issue of jurisdiction lapsed after the time allowed to file a return u/s 148 got over. I, thus find, the appellant's case is squarely covered by the provisions of section u/s 124(5) (b) of the Act. In view of this fact, the arguments raised by the Id. AR on behalf of the appellant are rejected". 7.1. The ld. CIT(Appeals) thus held that the ITO, Ward-2(3), Cuttack was holding jurisdiction over the assessee's case when the notice under section 148 was issued by him and the jurisdiction over the assessee's case remained w....
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....dy shifted from Cuttack to Midnapore, West Bengal and the ITO, Ward-2(3), Cuttack was aware of the same when the notice under section 148 was issued by him, the territorial jurisdiction over the assessee's case was not with ITO, Ward 2(3), Cuttack and the notice issued by him under section 148 to the assessee was invalid in the eyes of law. He contended that the return for assessment year 2016-17 was filed by the asseessee online giving the address at Midnapore, West Bengal and thus the intimation of new address was duly given by the assessee, which was duly acknowledged even by the ITO, Ward-2(3), Cuttack by mentioning the same in the notice issued under section 148. He contended that the notice issued by the ITO, Ward-2(3), Cuttack under section 148 on 30.03.2018 having no jurisdiction over the assessee's case was invalid and there being no notice issued under section 148 by the ITO, Ward-38(4), Midnapore, who had jurisdiction over the assessee's case at the relevant time and who finally completed the assessment under section 144/147, the entire proceedings under section 147/148 were bad-in-law and the assessment made in the case of the assessee under section 144/147 is liable to....
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....sessing Officer would be justified in sending the notice at the available address mentioned in the PAN database of the assessee, more particularly when the return has been filed under 'E-Module Scheme'. 11. In the rejoinder, the ld. Counsel for the assessee submitted that since the notice under section 148 was generated in the new address of the assessee at Midnapore, West Bengal, address in the PAN data must have been changed by the time the notice under section 148 came to be issued. He contended that the address of the assessee in PAN database thus was already changed by the time notice under section 148 was issued and consequently the jurisdiction over the assessee's case was also transferred from ITO, Ward-2(3), Cuttack to the ITO, Ward-38(4), Midnapore. 12. We have considered the rival submissions and also perused the relevant material available on record. The ld. Counsel for the assessee has challenged the jurisdiction of the ITO, Ward-2(3), Cuttack to issue notice under section 148 on the ground that the address of the assessee having been changed to Midnapore, West Bengal before the issuance of notice under section 148 on 30.03.2018, the ITO, Ward-2(3), Cuttack had n....
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.... or to transfer his case from Ward-2(3), Cuttack to Ward-38(4), Midnapore. 13. At the time of hearing before us, much emphasis has been laid by the ld. Counsel for the assessee on the fact that his change of address from Cuttack to Midnapore was duly informed by the assessee by way of the return of income filed for A.Y. 2016-17 wherein the address of Midnapore was clearly given and the ITO, Ward-2(3), Cuttack while issuing notice under section 148 on 30.03.2018 was well aware of the new address of the assessee. In this regard, the ld. D.R. has relied on the judgment of the Hon'ble Supreme Court in the case of Principal CIT -vs.- M/s. I-Ven Interactive Limited, Mumbai (supra), wherein Their Lordships have clearly held that a mere mentioning of the new address in the return of income without specifically intimating the Assessing Officer with respect to change of address and without getting PAN database changed, is not enough and sufficient. Elaborating further Hon'ble Supreme Court has observed that in the absence of any specific intimation to the Assessing Officer with respect to the change in address, the Assessing Officer would be justified in sending the notice at the availabl....
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....icer has all the powers conferred by or under the Act on an Assessing Officer in respect of the income accruing or arising or received within the area, if any, over which he has been wasted his jurisdiction by virtue of the directions or orders issued under sub-section (1) or sub-section (2) of section 120. 15. In view of the above discussion, we are of the view that the ITO, Ward-2(3), Cuttack was having jurisdiction over the assessee's case on 30.03.2018 when the notice under section 148 was issued to the assessee and the said notice issued by the Assessing Officer having jurisdiction over the assessee's case at the relevant time was a valid notice as rightly held by the ld. CIT(Appeals). 16. The second contention raised by the ld. Counsel for the assessee while challenging the reopening of assessment as made by the ITO, Ward 2(3), Cuttack is that the assessment was reopened by the Assessing Officer by issuing a notice under section 148 mechanically without applying his mind to the material available on record. He contended that the Assessing Officer simply relied on the information supplied by the Directorate of Income Tax (Investigation) and formed the reasons to believe ....
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....material on the basis of which the Assessing Officer could reopen the assessment. She contended that all that is required for reopening of the assessment is that there should be a tangible material on record on the basis of which a prima facie belief about the escapement of income can be entertained. 18. We have considered the rival submissions on this issue and also perused the relevant material available on record. In order to appreciate the stand of both the sides on this issue, it would be relevant to refer to the reasons recorded by the Assessing Officer for reopening the assessment, which are extracted below:- ".........Information received from the Investigation wing, Bhubaneswar shows that the assessee, Shri Saha had purchased an immovable property on 30.04.2008 for Rs. 29,30,000/- and sold the same on 16.08.2011 for Rs. 1,37,00,000/-and as such, he is liable to pay long term capital gain towards the said transaction. Analysis of information collected/ received: On going through the sale deeds of the both the transaction, it is found that the assessee purchased the land from one Ms Rabiya Khanum of Buxi Bazar on a cost of Rs. 29,30,000/- in the year 200....
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....ht to have been furnished in the return of income for the AY 2012-13 but the assessee has not filed the return and as such the amount has escaped assessment. In this context, I have the reason to believe that income of Rs. 97,48,025/- chargeable to tax has escaped assessment within the meaning of section 147 of the I.T. Act.......". 19. A perusal of the reasons recorded by the Assessing Officer clearly shows that specific information was received by him from the Investigation Wing, Bhubaneswar that the assessee had purchased a immovable property for Rs. 29,30,000/- on 30.04.2008 and the same was sold on 16.08.2011 for Rs. 1,37,00,000/-. The said information received by the Assessing Officer was duly supported by the documentary evidence in the form of sale deeds of both the transactions and after going through the same, it was noted by the Assessing Officer that the sale of immovable property of the assessee had given rise to a long-term capital gain, which was chargeable to tax in the hands of the assessee for the year under consideration, i.e. A.Y. 2012-13. The Assessing Officer also computed such long-term capital gain chargeable to tax in the hands of the assessee for the ye....