2021 (11) TMI 47

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.... which according to him is a legal issue which goes to the root of the jurisdiction of the AO to frame the assessment order. Therefore, the same may be adjudicated first and further contended that since it is a legal issue it can be raised for the first time as per the Hon'ble Supreme Court decision in the case of NTPC Ltd. 229 ITR 383 (SC). 3. The legal issue that has been raised as additional ground reads as under: "For that in the facts and circumstances of the instant case, the Ld. Commissioner of Income Tax (Appeals)-2, Guwahati acted unlawfully in not appreciating that none of the conditions precedent existed for and/or were fulfilled by the Ld. Income Tax Officer, Ward-4(3), Guwahati for his specious action of issuing not....

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.... issued the mandatory scrutiny notice u/s 143(2) of the Income Tax Act, 1961 (hereinafter referred to as the Act) and after realizing the mistake had transferred the case file to the jurisdiction of DCIT, Circle-4 who framed the assessment order u/s 143(3) of the Act, which is bad in law because the DCIT has not issued the notice u/s 143(2) of the Act. For ready reference, Instruction No. 1/2011 is reproduced below: "INSTRUCTION NO. 1/2011 (F. NO. 187/12/2010-IT(A-1), DATED 31-1-2011 References have been received by the Board from a large number of taxpayers, especially from mofussil areas, that the existing monetary limits for assigning cases to ITOs and DCs/ACs is causing hardship to the taxpayers, as it results in trans....

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....sdiction to conduct assessment if it is above Rs. 15 lakhs. Above Rs. 15 lacs income declared by a non-corporate person i.e. like assessee, the pecuniary jurisdiction lies before AC/DC. In this case, admittedly, the assessee an individual (non corporate person) who undisputedly declared income of Rs. 20,03,070/- in his return of income cannot be assessed by the ITO as per the CBDT circular (supra). From a perusal of the paper book, it reveals that the statutory notice u/s. 143(2) of the Act was issued by the then ITO, Ward- 4(3), Guwahati on 20.09.2016 (Refer Page 211 of PB); and the same was served upon the assessee as noted by the AO in the assessment order. Later on the ITO taking note that since the returned income is more than Rs. 15 l....

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....ssee. It is settled law that serving of notice u/s. 143(2) of the Act is a sine qua non for an assessment to be made u/s. 143(3) of the Act. In this case, notice u/s. 143(2) of the Act was issued on 20.09.2016 by ITO, Ward-4(3), Guwahati when he did not had the pecuniary jurisdiction to assume jurisdiction and issue notice. Admittedly, when the ITO realized that he did not had the pecuniary jurisdiction to issue notice, he duly transferred the file to the DCIT, Circle-4, Guwahati, when the DCIT issued notice u/s 142(1) of the Act and did not issue notice u/s 143(2) of the Act within the time limit prescribed for issuance of notice u/s. 143(2) of the Act for the assessment year 2015-16. We note that the DCIT by assuming the jurisdiction afte....