TaxTMI 
TaxTMI 
2022 (8) TMI 127
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....sale of immovable property by the assessee himself and not in capacity as Power of Attorney of one Shri Prahlad Singh for sole reason that the Power of Attorney Executor could not be produced after a gap of about eight years. 2. Ld. CIT(A) has erred in law and on facts sustaining legality of order of the AO in which addition of Rs.4,07,000/- was made by ignoring the different judicial pronouncement when: (a) Reasons recorded and notice u/s 148 of IT Act was issued to by the Assessing Officer, having no jurisdiction over the case of the assessee. (b) Without prejudice so subground (a) no proper satisfaction as required u/s 151 was obtained even by the said nonjurisdictional Assessing Officer. 2.2 Apropos ground No. 1 and 2 of the assessee, brief facts of the case are that the assessee filed original return of income on 26-06-2010 electronically declaring total income at Rs.1,58,540/- but the assessee did not file the return of income in response to notice dated 28-03-2017 issued u/s 148 of the Act. It is also pertinent to note that the case of the assessee was transferred from ITO, Ward 5(2), Jaipur to ITO, Ward 1(2), Jaipur. As per information received from ITO, Ward 5(2....
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.... which he had received as a power of attorney holder. The contention of the AO was that the assessee had to prove that the sale realization had been received and transferred to power of attorney executor but he failed to do so. The efforts were made by the AO to call for information from Shri Prahlad Singh vide his office letter No. 1209 dated 01-12-2017 on the known address through notice server but the notice server reported that Shri Prahlad Singh left the house on that address. The AO looking to overall facts of the case and the discussion made with the assessee found the assessee liable to pay long term capital gain on sale of property in question by calculating as under:- Sale Consideration Rs.8,87,220/- Indexed cost of acquisition Rs.8,50,558(6,68,873x632/497) Long Term capital Gain Rs.36,662/- Accordingly, an addition of Rs.36,662/- was made by the AO to the total income of the assessee as long term capital gain on sale of property. In this view of the matter, the AO was satisfied that the assessee concealed the income in the form of undisclosed long term capital gain for which the AO initiated the penalty u/s 271(1)(c) of the Act separately. 2.3 Further, the AO ....
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....appeal of the assessee by observing as under:- Regarding Ground No. 1 sustaining the amount of Rs.36,662:- ''5.1 The contention of the appellant is that the assessee is only the power of attorney hold for sale of immovable property. In the support of the contention the assesse had not produced copy of power of attorney for sale of immovable property. Further, the appellant stated that the cheque mentioned in the sale deed and cash was not received by the assessee but received by the original owner of the property. The assessee should have furnished the evidence proving the cheque deposit in the bank account of the so called owner of the property. Further a confirmation from the said owner should have been furnished before the AO or during appellate proceedings. No material evidence could be furnished in respect of the contention by the assessee either during the appellate proceedings or even during the assessment proceedings. Under such circumstances the ground raised in this ground cannot be allowed. The ground no. 3 is dismissed. Regarding Ground No. 2 sustaining the legality of order of the AO by ld CIT(A) for issuance of notice u/s 148 of the Act. ''3.2 It is clear in....
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....Ward 5(2), Jaipur was also confirmed by the ITO, Ware 1(2), Jaipur at the initial part of the assessment order dated 30-10-2017. Appeal against. GROUNDS OF APPEAL: GROUND No.(1) Ld. CIT(A) was not justified in sustaining addition of Rs.36,662/- on basis of wrong and misleading finding of the Id. A.O. that the sale of immovable property was by the assessee himself and not in capacity as Power of Attorney of one Shri Prahlad Singh for the sole reason that Power of Attorney Executor could not be produced after a gap of about eight years. As a Power of Attorney-holder of close person Mr. Prahlad Singh S/o. Shri Ugam Singh P.B. page 5 to 8), assessee had sold an immovable property for total consideration of Rs.8,21,000/- (Evaluated price Rs.8,87,220/-) (P.B. page 9 to 14). Out of sale consideration, Rs.1,21,000/ was received in cash on 29.01.2010 and remaining Rs.7,00,000/- by cheque No. 959132 dated 02.02.2010 in name of Power of Attorney Executor which was deposited in his (P.O.A. Excecutor's) bank account. This fact is confirmed from by the Id. AO that in assessee's bank account there is no credit of Rs.7,00,000/- (finding of Id. AO at bottom of page (4) of the asses....
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.... ((2016) 381 ITR 428 (Del): Reassessment; Notice issued by AO having no jurisdiction. Notice uls. 148 was invalid as being issued by AO other than the one who had jurisdiction over case of the assessee. (2) Shirishbhai Hargovandas Sanjanwala Vs. ACIT (2017) 396 ITR 167 (Gul): Competent authority- jurisdiction- notice for reassessment issued by authority other than authority normally Assessing Officer not mere irregularity or curable defect-defective issuance of notice and not service of notice not curable-to be quashed. (3) Pr. CIT Vs. Mohd. Rizwan Prop. M.R. Garments (2018) 11 ITROL 149 (All): Notice u/s. 148 validity- condition precedent. Notice issued by AO who had no jurisdiction. Notice void ab-initio. Not a defect curable under section 292BB. (4) (d) City Union Bank Ltd. Vs. ACIT (2020) 425 ITR 475 (Mad): Notice issued without jurisdiction. Existence of alternate remedy would not bar issue of writ to quash the notice. (5) Satish Kumar Khandelwal Vs. ITO (2021) 61 TAX WORLD 71 (JPR): An order passed by an officer having no jurisdiction to pass such order is void ab-initio and deserves to be annulled. The defect in the order is not curable and it cannot be rectified....
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....ment of income. The reopening of case is bad in law and liable to be quashed. Moreover, the reasons demonstrated that Addl. CIT had written that he was satisfied that it was a fit case for reopening under section 147 which established that he had not recorded proper satisfaction or approval before issue of notice u/s. 148. Thereafter the AO had mechanically issued notice u/s 148 on the basis of information received by him from Investigation Wing. (6) Bull Riders Financial Services (P) Ltd. Vs. ITO (2020) 207 TTJ (Del) 573: Full and true disclosure- AO having re-opened the assessment simply on the basis of fax message received from another officer stating that the assessee is a beneficiary of accommodation entries even though the AO was not having any list of beneficiaries at the time of signing the recorded fax message, the reasons for reopening the assessment were wrong. incorrect and non-existence and therefore, the reopening of assessment is illegal, bad in law and void ab-initio. Moreover, the AO was already aware of the fact that the assessee has received share application money and there was no failure on part of the assessee to disclose truly and correctly all material fa....
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....i 94 Taxmann.com 355 (Delhi) 2.7 We have heard both the parties and perused the materials available on record. From the records, it is noted that the assessee filed his return of income on 26-06-2010 declaring total income at Rs.1,58,540/- having jurisdiction over the case whereas action u/s 147 of the Act was initiated after recording reasons by a Non-jurisdictional AO (ITO, Ward-5(2), Jaipur) who had also obtained sanction u/s 151 of the Act from the Pr. CIT-2, Jaipur and issued notice u/s 148 of the Act on 08-03-2017 (Paper Book Page 18). After realizing jurisdiction error, the reopened case was transferred by ITO, Ward 5(2), Jaipur to ITO, Ward 1(2), Jaipur. It is also noted from the assessment order wherein Jurisdictional AO had confirmed as under:- ''The case was received on transfer from ITO, Ward 5(2), Jaipur on 24-10-2017 as the jurisdiction over the case lies with the undersigned.'' It is noteworthy to mention that it is a settled law that notice issued u/ 148 of the I.T. Act by the Assessing Officer, having no jurisdiction, the assessment order and consequent proceedings are invalid. There are so many case laws by various courts, few of which are as under:- (1) D....