AI Drafter 
TaxTMI 
TaxTMI 
2022 (11) TMI 1175
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....MEET PRITAM SINGH ARORA, J (Oral): 1. The present batch of petitions are being taken up together as they give rise to a common issue relating to their maintainability on account of the preliminary objection raised by the revenue that these writ petitions cannot be entertained by this Court as the situs of the jurisdictional assessing officers ["JAO"] are outside the National Capital Territory of Delhi and hence beyond the territorial limits of this Court. 2. For the sake of convenience, WP(C) 5546/2021 is being treated as the lead petition and the facts of that petition alone are being adumbrated hereinafter, which would cover the similar preliminary objections raised by the revenue counsel in the remaining writ petitions as well. WP(C) No.5546/2021 - GPL-RKTCPL JV vs. NATIONAL FACELESS ASSESSMENT CENTRE 3. The petitioner has challenged the impugned assessment order dated 24.04.2021 passed by the Respondent under Section 143(3) read with Section 144B for assessment year 2018-19 and notice of demand of even date issued under section 156 as well as notice for initiation of penalty proceedings under Section 271AAC (1) of the Income tax, Act, 1961. 4. By way of an order ....
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....P. (C) 9951/2021, titled Ashish Kumar Jhunjhunwala vs. National Faceless assessment Centre, Delhi wherein a preliminary objection was taken by the counsel for the revenue as to the maintainability of the that writ petition on the ground of territorial jurisdiction since the PAN AO, was located outside Delhi. The Petitioner in Ashish Kumar Jhunjhunwala (supra) after few hearings sought leave to withdraw the Petition which was allowed and the Petition came to be dismissed as withdrawn vide order dated 28.03.2022. Accordingly, on 28.03.2022, this Court noted that WP(C)9951/2021 had stood dismissed as withdrawn and directed as follows: "The present matter was tagged with W.P.(C) No.9951/2021. However, the said writ petition has been dismissed as withdrawn. Accordingly, list the present writ petition before the Roster Bench on 18th April, 2022. Mr.Zoheb Hossain, learned standing counsel for the Revenue shall continue to assist this Court on behalf of the respondent. Interim order to continue." 7. The preliminary objection raised by Mr. Zoheb Hossain, Senior Standing Counsel, on the admissibility of the present writ petition are to the following effect:- ....
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.... the JAO would be the concerned authority to coordinate with the NaFAC to instruct Counsel to assist the Court. (vi) The doctrine of forum non conveniens was considered in the case of Sterling Agro Industries Ltd. vs Union of India & Ors- 2011 (124) DRJ 633 (FB) [Paras 29 - 32] by a 5 judge full bench of this Court in a writ proceeding, and Article 226(2) was directly under consideration as to whether the order of the Appellate Authority would constitute a part of the cause of action rendering the writ petition maintainable and whether the petitioner being dominus litis could choose his forum and approach the High Court where the appellate authority is located. After examining the entire jurisprudence on this aspect, this Court arrived at the conclusion that even if a small fraction of the "cause of action" accrues within the jurisdiction of the Court, the Court will have jurisdiction. However, the Court may refuse to exercise such jurisdiction and must, in fact, remind themselves of the doctrine of forum non conveniens. (vii) In tax matters, the consistent view has been that the most convenient forum for an Assessee would be where his PAN is located. This is for ....
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....ntertained, when in fact, admittedly his PAN lies with an AO in Chhattisgarh, this would lead to yet another problem of burdening this Court's already overburdened docket and therefore the principles of administration of justice would also be a relevant factor for determining the doctrine of forum non conveniens. (xiii) Yet another factor is that the assessee is admittedly not a resident of Delhi as evident from the memo of parties and therefore, cannot claim any convenience on account of residence. (xiv) The NFAC finalises an assessment, converts it into an order and conveys it to the Assessee. However, as explained earlier, the order is prepared by the FAO with assistance from technical and verification units. Therefore, the NFAC merely communicates the order and it is well settled that mere service of notices or sending messages from a particular place would not constitute an integral part of the cause of action. (See Paras. 13 and 14 of Kusum Ingots and Alloys Ltd. v. Union of India 2004 6 SCC 254.) (xv) Any reliance by the Petitioner on the coordinate bench decision in [RKKR Foundation vs. National Faceless Assessment Centre Delhi & Ors. [2021] 436 I....
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....4B(1)(xvi), (xxi), (xxiii), (xxv), (xxviii), (xxxi)]. (ii) Under the faceless regime, the role of the JAO is limited to receiving the income-tax return of the assessee located within the territorial jurisdiction of the JAO ; thereafter the JAO becomes functus officio. (iii) Presently, even the jurisdiction to levy penalty does not lie with the JAO but with the Respondent- NaFAC itself. Refer CBDT Order F. No.187/4/2021-ITA-I dated 20.01.2021; (iv) Sub-section (3) of section 144B further provides that NaFAC shall be set up by the CBDT to facilitate the conduct of faceless assessment proceedings in a centralized manner, which shall be vested with the jurisdiction to make faceless assessment. Subsection (3) further provides for setting up of Regional Faceless Assessment Centres, assessment units, verification units, technical units and review units for undertaking various tasks as provided for in section 144B of the Act, which are all set up under the umbrella of the NaFAC. (v) Thus, in the faceless regime, the JAO has no locus standi with respect to exercising jurisdiction over an assessee to make assessment. It is, therefore, submitted that the su....
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....om anywhere. The communication/ correspondence between the Petitioner and the NaFAC has been done on the income-tax portal and the same is also accessible from any location. (e) When a part of the cause of action arises within one or the other High Court, it will be for the petitioner to choose his forum and once the Petitioner herein, being dominus litis, has invoked the jurisdiction of this Court, the primacy to the freedom given to the Petitioner needs to be respected. [Refer: Kusum Ingots & Alloys Ltd vs UOI (supra), para 25 & Vishnu Security Services vs Regional Provident Fund Commissioner: LPA No.960 of 2011 (Del HC) dated 17.02.2012, para 10] (f) Further, for ousting jurisdiction of a High Court, case of another High Court being better equipped and convenient Court for all parties concerned has to be made out [Refer: Jan Chetna (supra)]. In the facts of the present case, it will be noticed that: • the headquarters of the sole Respondent are in Delhi; • the issue raised is purely legal; • the issue involved has no local flavour; • there have already been 7 appearances by the Petitioner before this High Cour....
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....enient to approach considering the robust functioning of this Court in virtual mode; thus, for bona fide reasons. (ix) In that view of the matter the present writ petition is maintainable and deserves to be entertained by the Delhi High Court. WP(C) 9307/2022 - RKKR FOUNDATION vs. NATIONAL FACELESS ASSESSMENT CENTRE & ANR. 9. The present petition arises out of the proceedings emanating from the earlier order passed by this Court in the case of RKKR Foundation vs. National Faceless Assessment Centre Delhi & Ors. [2021] 436 ITR 49 (Delhi) passed in WP(C) No.5277/2021. 10. In this case, the Petitioner has, inter alia, challenged the assessment order dated 30.05.2022 for assessment year 2018-19 passed by the JAO located at Chandigarh. 11. Mr. Puneet Rai, Sr. Standing Counsel for the Revenue, raised a preliminary legal objection on the following grounds:- (i) This Court lacks territorial jurisdiction for the reason that the impugned assessment order dated 30.05.2022 has been passed by the JAO located at Chandigarh, which is outside the jurisdiction of this Court; consequently, the more appropriate forum for invoking the writ jurisdiction under Article 226 o....
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....) Further it is also submitted that the assessee once relegated to the CIT Appeals and the order passed by CIT Appeals can only be challenged by Revenue or the Assessee before the ITAT having jurisdiction over the jurisdictional assessing officer. The same has been clarified in Clause 8 of the Notification dated 25.09.2020 notifying the Faceless Appeals Scheme, 2020 under Section 260(6B) of the Act of 1961) as noted above. 12. Disputing the aforesaid, Mr. Rohit Jain, learned counsel appearing for the Petitioner states that the present writ petition is maintainable before this Court and deserves to be entertained on the following grounds: (i) It is not open to either the Revenue or the Court to raise the plea of maintainability of the writ inasmuch as the same is barred by the principle of res judicata since the said issue of maintainability stood finally concluded in the case of the Petitioner vide order dated passed by the Division Bench of this Court in writ petition bearing WP(C) No.5277/2021. In support thereof, Petitioner contends as under: (a) In the case of the Petitioner assessee, assessment under section 143(3) read with section 144B of the Income Tax ....
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....fect being raised by the Respondents, the issue relating to challenge to territorial jurisdiction of this Court stands concluded in favour of the Petitioner, and no objection to that effect can be raised by the Revenue and even by the Court, on the ground of being barred by the principle of res judicata. (ii) It is further submitted that vide the present challenge to the validity of the assessment order dated 30.05.2022, the Petitioner is, in fact, seeking enforcement of the earlier order dated 17.05.2021 passed by this Court, and thus, the primary [and, in any case, part of] 'cause of action' giving rise to the present petition arises within the territorial jurisdiction of this Court in terms of Article 226(2) of the Constitution of India. In support of the said ground, it is contended as under: (a) Vide order dated 17.05.2021, this Court set-aside the assessment framed by the NaFAC and granted liberty to the said authority "to pass a fresh assessment order after giving an opportunity of personal hearing to the authorized representative of the Petitioner"; however, in complete violation of the direction of this Court, instead of the National Faceless Assessment C....
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....e same, would vest with the Court. 4.3 In our view, we are inclined to exercise jurisdiction in the matter, as this would, one way or the other, conclude the matter. It would save time and expense both, for the revenue, as well as the assessee and lend certainty as to how parties are to proceed further in the matter." 14. We find force in the submission of the Revenue to the extent that the view expressed by a co-ordinate bench of this Court in RKKR foundation has not taken into account the entire conspectus of the legal position in assignment proceedings with reference to the hierarchy of appellate authorities under the Act, 1961 and that the matter requires a deeper consideration. We are also of the view that applying the doctrine of forum non-conveniens as laid down by a Full bench of this Court in Sterling Agro (supra), this Court can refuse to entertain the writ petitions where the jurisdictional assessing officer i.e. JAO is based outside the NCT of Delhi. However, it would be appropriate to refer this matter to a larger bench for a conclusive view as this issue will arise repeatedly in many cases. 15. Having heard the rival submissions and given our thoughtful....