2020 (10) TMI 988

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.... on account of assessee's failure in discharging onus of identity, genuineness and creditworthiness of the share application / premium's investors of Rs. 6 crores. The Revenue seeks to revive the said addition which stands deleted in the lower appellate proceedings. 3. Mr. Ghosh invited our attention to the assessee's pleadings in its Cross Objection No. 34/Kol/2019 that the impugned assessment itself is invalid in the eyes of law for want of a valid of section 143(2) notice. The assessee has admittedly raised the instant plea for the first time before the tribunal. We, therefore, afforded ample opportunity to the department to rebut the same. 4. We have received a report from Office of the Addl. CIT-DR, ITAT, Kolkata dated 29-01-2020 inter-alia stating therein that the ITO, Ward 24(3) Kolkata had issued section 143(2) notice dated 07.08.2013 to the assessee whereas the section 143(3) assessment in question has been framed by TRO-4, Kolkata (acting as the Assessing Officer). It is further overtaken stated therein that the assessee had filed its return on 30-09-2012 followed by ITO, Ward 24(3), Kolkata issued section 143(2) notice dated 07-08-2013 transfer of assessment to the....

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....erved by the AO, Ward No. 6(1), Kolkata are that the assessee company filed its return of income electronically declaring income of Rs. 8950/-. Later case was selected for scrutiny. Notice u/s. 143(2) of the Act ~served from office of ITO, Ward-34(2). Then the jurisdiction of the case was transferred to ITO, Ward-6(1), Kolkata and a notice was also issued from this ward. According to AO, summons u/s. 131 of the Act were sent to the directors of the assessee company but summons were returned un-served and no compliance was made on behalf of the assessee company. Thereafter, show cause notice was sent through speed post which has been returned un-served. As no compliance was made on behalf of the assessee till the completion of assessment, the AO was let with no alternative but to pass the assessment order dated 13.03.2015 u/s. 144 of the Act. Thereafter the AO observed that the assessee company was incorporated on21.01.2009 and has shown the figure of Rs. 15,36,90,0001- as share premium during the assessment year under consideration. According to AO, the source of huge premium has not been explained by the assessee company. Therefore, considering the above share capital claimed by t....

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....lkata by virtue of Notification issued by CBDT u/s. 120 of the Act dated 31.07.2001 (Notification No. 228/2001) and also by virtue of latest Notification No. 50/2014 dated 22.10.2014. So, according to Ld. AR, since the ITO, Ward-34(2), Kolkata did not enjoy any jurisdiction over the assessee-company and thus the notice u/s. 143(2) of the Act claimed to have been issued by the ITO, Ward-34(2), Kolkata against the assessee company was without jurisdiction so, bad in law and, therefore, the notice issued by an officer/authority who does not enjoy jurisdiction is non-est in the eyes of law. Ld. AR also brought to our notice that the claim of ITO, Ward-6(1), Kolkata in the assessment order that the file of assessee was transferred from ITO, Ward-34(2), Kolkata is itself illegal sinceit was pointed out by the Ld. AR that in the impugned assessment order there was no reference or mention by the AO (ITO Ward-6(l), Kolkata) of any order of transfer of jurisdiction passed by the concerned Pr. CIT u/s. 127 of the Act. According to Ld. AR, in any case, the assessee has not been served with any such order i.e. transfer order u/s. 127, or notice u/s. 143(2) or 142(1) etc. Thus, according to Ld. ....

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....a who falls under the jurisdiction of Pr. ClT/ClT, KOlkata-2 only had the jurisdiction to assess the income of the assessee. Thus w,GBP record a find in of fact and law that the ITO Ward-6 1 Kolkata Was the officer authority who was vested with the 'jurisdiction of Assessee i.e. Aa of the assessee com an. We note that the impugned assessment order framed by the AO) dated 13.03.2015 was passed by the jurisdictional ITO, Wd-6(1), Kolkata. However, the main grievance of the assessee company is that before scrutinizing the assessment u/s. 143(3) of the Act, notice u/s. 143(2) of the Act needs to have been issued by ITO, Ward-6(1), Kolkata was sine qua non as held by the Hon'ble Supreme Court in Hotel Bluemoon 321 ITR 362 (SC) was in fact not issued by him [ITO, Wd-6(1), Kolkata] before completing the assessment u/s. 143(3)1144 the Act. So the jurisdictional fact which needs to be ascertained by us is whether ITO, Ward-6(1), Kolkata issued notice on the assessee u/s. 143(2) of the Act before framing the scrutiny assessment. We note that the ITO, W d- 6(1),Kolkata has passed a best judgment assessment u/s. 144 of the Act alleging nonparticipation on the part of the assessee compa....

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.... not enjoy jurisdiction) is non-est in law and, therefore, is bad in law and transfer of the jurisdiction as contemplated u/s. 127 of the Act to ITO, Wd-6(l), Kolkata. The Hon'ble jurisdictional High Court in Kusum Goyal (2010) 329 ITR 283 (Cal) has clearly spelt out that the ITO on its own cannot transfer the jurisdiction without order from the competent authority. In this case, we note that there is no mention in the assessment order of any transfer order passed by the concerned CIT-12, therefore, the contention of the ITO, Ward-6(1), Kolkata that the jurisdiction has been transferred from ITO,Wd-34(2) to ITO, Wd-6(l), Kolkata is also without authority and vitiates the transfer of jurisdiction as claimed by the AO in the assessment order and thus this factual so vitiates the assessment order. In the light of the above as well as the contention of the assessee that no opportunity of hearing was rendered to it by ITO, Wd-6(1), Kolkata before framing assessment u/s.144of the Act which omission on the part of AO also is against principle so factual justice and the impugned assessment u/s 144 of the Act is fragile for non-adherence of principle of natural justice on the part of AO. Th....