TaxTMI 
TaxTMI 
2022 (11) TMI 330
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....ties to decide the proceedings in accordance with law under the Income Tax Act. 02. Having found that cash receipts by writ petitioner amounting to Rs.3,05,00,000/- were not reflected in his books of account, after notice under Section 142(1) of the Income Tax Act, Respondent No.1 passed the impugned orders of assessment. In this writ petition, the challenge is on the assessment orders as well as demand notices and penalty notices, passed by respondent No.1 for the assessment years 2013-2014 to 2020-2021. 03. This court has heard the submissions of Mr.Nerella S.V.Raviteja., learned counsel for the writ petitioner and Ms.M.Kiranmayee., Learned Senior Standing Counsel for Respondent No.1 Income Tax department. 04. From the record and from the submissions of learned counsels on both sides a few undisputed facts need a mention. The writ petitioner is an individual income tax assessee having Pan: No.AGPPS8124-A. He is aged about 75 Years and is a resident of Mumbai of State of Maharastha. He was regularly filing income tax returns at Mumbai with Assessing Officer Ward 19 (1)(3) at Mumbai. His main source of income is from investments under other income heads and claims to have never ....
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....ning writ petitioner, the proceedings for assessment should be taken up by the Authorities at Mumbai. But in this case Respondent No.1/Authorities at Guntur itself proceeded and that is in violation of Section 153C of the Income Tax Act. That the petitioner has no other efficacious alternative remedy except to seek the redressal before this court. Therefore, the impugned notices and orders can not be allowed to survive. [07. In response to the above contentions, the learned standing counsel for Revenue/respondents contended that the material obtained during search and seizure action was incriminating as it pointed out the writ petitioner avoided disclosure of income and therefore the respondent No.1 initiated scrutiny proceedings under Section 153C and this writ petitioner never questioned the jurisdiction of Assessing Officer and submitted himself to the jurisdiction of Assessing Officer and therefore he cannot now turn around and contend that the Assessing Officer had no jurisdiction to pass the Order of assessment in his case. Order under Section 127 of the Income Tax Act passed by the Principle Income Tax Officer, Vijayawada dated 16.02.2021 granted jurisdiction to DCIT, Centr....
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....ax, Vijayawada transferring the Income Tax jurisdiction of writ petitioner from Mumbai of Maharastha State to Guntur of A.P.State enabling Respondent No.1 to pass the impugned orders is arbitrary and is in violation of Section 127 of Income Tax Act? (2) Whether Respondent No.1 had no jurisdiction against the writ petitioner under Section 153C to initiate scrutiny proceedings against the writ petitioner and pass assessment Orders? (3) Whether transfer of a case under Section 127 of Income Tax Act cannot be questioned after initiation of scrutiny proceedings under Section 153C since writ petitioner did not question the jurisdiction at that time and submitted himself to the jurisdiction of Respondent No.1? (4) As against the Orders of assessment which are impugned only an appeal lies to the Commissioner of Income Tax (Appeals) and this writ petition is not maintainable? POINT Nos.1 to 4:- 12. Respondent No.1 gained input about the alleged un-accounted cash transactions between the writ petitioner and M/s.Polisetty Somasundaram Group on 28.01.2020 during the course of said search and seizure proceedings conducted at Guntur. It was then, Respondent No.1 initiated proceedings und....
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.... is made and for the relevant assessment year or years as referred to in sub-section (1) of section 153A except in cases where any assessment or reassessment has abated. (2) Where books of account or documents or assets seized or requisitioned as referred to in sub-section (1) has or have been received by the Assessing Officer having jurisdiction over such other person after the due date of furnishing the return of income for the assessment year relevant to the previous year in which search is conducted under section 132 or requisition is made under section 132A and in respect of such assessment year- (a) no return of income has been furnished by such other person and no notice under sub-section (1) of section 142 has been issued to him, or (b) a return of income has been furnished by such other person but no notice under sub-section (2) of section 143 has been served and limitation of serving the notice under sub-section (2) of section 143 has expired, or (c) assessment or reassessment, if any, has been made, before the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person, ....
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.... the person to whom the said document "belongs........" Hon'ble Supreme Court of India interpreted and explained Section 153C of Income Tax Act in Super Malls Private Limited v. Principal Commissioner of Income Tax, 8, New Delhi (2020) 4 SCC 581 and laid down the law, which is as below: "7. This Court had an occasion to consider the scheme of Section 153-C of the Act and the conditions precedent to be fulfilled/complied with before issuing notice under Section 153-C of the Act in Calcutta Knitwears (CIT v. Calcutta Knitwears (2014) 6 SCC 444) as well as by the Delhi High Court in Pepsi Food (P) Ltd. ( Pepsi Food (P) Ltd. v. CIT, 2014 SCC Online Del 4029 : (2014) 367 ITR 112). As held, before issuing notice under Section 153-C of the Act, the assessing officer of the searched person must be "satisfied" that, inter alia, any document seized or requisitioned "belongs to" a person other than the searched person. That thereafter, after recording such satisfaction by the assessing officer of the searched person, he may transmit the records/documents/things/papers, etc. to the assessing officer having jurisdiction over such other person. After receipt of the aforesaid satisfaction and ....
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..... (2) Where the Assessing Officer or Assessing Officers from whom the case is to be transferred and the Assessing Officer or Assessing Officers to whom the case is to be transferred are not subordinate to the same Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner- (a) where the Principal Directors General or Directors General or Principal Chief Commissioners or Chief Commissioners or Principal Commissioners or Commissioners to whom such Assessing Officers are subordinate are in agreement, then the Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner from whose jurisdiction the case is to be transferred may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, pass the order; (b) where the Principal Directors General or Directors General or Principal Chief Commissioner or Chief Commissioners or Principal Commissioners or Commissioners aforesaid are not in agreement, the order transferring th....
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.... ever granted an opportunity of hearing to the writ petitioner before they transferred the case. It is to be stated here that the Principal Commissioner of Income Tax at Mumbai served a notice dated 02.03.2021 on this writ petitioner for transfer of the jurisdiction for the purpose of coordinated investigation and assessment from Mumbai to Guntur. The said notice is extracted here: "OFFICE OF THE PRINCIPAL COMMISSIONER OF INCOME TAX -19 2nd Floor, Matru Mandir, Tardeo Road, Mumbai - 400 007 Tel:022-23855951/FAX:022-23821527 Email ID:[email protected] No.Pr.CIT-19Centralisation/Polisettygrp/2020-21 date:02.03.2021 PAN:AGPPS8124A To Shri Vijay Nathulal Sharma, 83-A, Anita Bldg, 8th Floor, Mt.Pleasant Road, Malabar Hill, Mumbai-400006. Sir/Madam, Sub: Centralisation for income tax assessment in your case-Opportunity to make submissions. Ref: Search action u/s.132 of the Income Tax Act, 1961 conducted on 28.01.2020 in case of M/s. Polisetty Somasundaram Group & Others, Guntur. ****** Please refer to the above. 2. A search u/Section132 of the Income Tax Act, 1961 was conducted on 28.01.2020 in case of M/s.Polisetty Somasundaram Group & Others, Guntu....
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....me Tax. Yet, the action of transfer was taken up and achieved by the authorities of respondent No.1 which is not provided under law. This action on the part of the authorities of Respondent No.1 can be called as arbitrary as it was done in violation of the mandate in Section 127 of Income Tax Act. Article 14 of the Constitution of India provides for equal protection of laws and in the case at hand the acts of the authorities of Respondent No.1 which are based on Order dated 16.02.2021 by the learned Principal Commissioner of Income Tax, Vijayawada stand against that constitutional mandate. 15. The upshot of the above discussion would indicate that the Order of transfer of case under Section 127 was without jurisdiction and the proceedings initiated under Section153C on the part of Respondent No.1 are also without jurisdiction. Therefore, the orders of assessment that were passed by Respondent No.1 on the anvil of the above proceedings under Section 127, 153C shall be held as invalid orders passed without jurisdiction. 16. In such scenario, the contention of the standing counsel for Revenue is that the writ petitioner when received notices and summons from Respondent No.1 did not ....