TaxTMI 
TaxTMI 
2022 (6) TMI 1458
X X X X Extracts X X X X
X X X X Extracts X X X X
....s and conjectures. 3. For that on the facts and in circumstances of the case the order passed by the ld. Assessing Officer and the confirmation of the same by CIT (A) - 1, Patna is also unsustainable in law being violative of the settled principles of natural justice as no reasonable opportunity was allowed to furnish defence in course of assessment proceedings. 4. For that on the fact and in circumstances of the case the ld. Assessing Officer has assessed the income under section 143 (3) of the Act without issuing the statutory notice under the provisions of section 143(2) of the Act and the confirmation of the same by the CIT (A)-1, Patna is bad, unjustified, surmises and conjectures. 5. For that on the fact and in circumstances of the case the assessment order passed by the ld. Assessing Officer is bad in law as the ld. Assessing Officer completed the assessment while the statutory notice under the provisions of section 143 (2) of the Act was issued by the Income Tax Officer, Ward - 3(3) Aurangabad. 6. For that on the fact and in circumstances of the case the issuance of notice under the provisions of section 143 (2) of the Act is mandatory pr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....fficer has erred in adding the entire contractual receipt amounting to Rs. 39,50,451/- in total income of assessee on the ground that the assessee has not provided any documentary proof relating to works done by the M/s Puja Construction Bhagalpur. 14. For that on the fact and in circumstances of the case the ld. Assessing Officer has erred in initiating the penalty proceeding under the provisions of section 271(1)(c) of the Act on the ground that the appellant concealed the particulars of income. 15. For that on the facts and in circumstances of the case initiation of penalty proceeding under the provisions of section 271 (1) (c) for the concealment of income is wholly arbitrary, unwarranted, wrong and illegal. 16. For that on the fact and in circumstances of the case the ld. Assessing Officer has erred in charging interest under the provisions of section 234 B & 234 D without making any provision in the order of assessment there on. 17. For that on the facts and in circumstances of the case charging of interest under the provisions of section 234 B & 234 D are wholly arbitrary, unwarranted, wrong and illegal. 18. For that the observati....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... been fixed by the CBDT and that if the returned income is less than Rs. 20 lacs in case of non-corporate assessee in mofussil area, the jurisdiction to frame the assessment lies to the Income Tax Officer whereas if the returned income is more than Rs. 20 lacs, the jurisdiction lies with the concerned ACIT/JCIT. The ld. counsel has submitted that the jurisdiction to pass the assessment order in this case laid with the ACIT/DCIT as the income declared by the assessee was more than Rs. 20 lacs. The ld. counsel has further invited our attention to the impugned assessment order to show that the assessment order in this case has been passed by ACIT, Circle3(1), Gaya. He has further submitted that notice u/s 143(2) dated 20.09.2016 was issued by the Office of the Income Tax Officer (ITO), Ward-3(3), Aurangabad. The ld. counsel in this respect has submitted that in this case, the jurisdiction to issue notice u/s 143(2) of the Act vested with the ACIT and not with the ITO on account of pecuniary jurisdiction, the returned income being more than Rs. 20 lacs of the assessee. He has further submitted as per the settled proposition of law, the issue of notice u/s 143(2) by the concerned Ass....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... authorities who are subordinate to it. (3) In issuing the directions or orders referred to in sub- sections (1) and (2), the Board or other income- tax authority authorised by it may have regard to any one or more of the following criteria, namely:- (a) territorial area; (b) persons or classes of persons; (c) incomes or classes of income; and (d) cases or classes of cases ...... 6. A perusal of the aforesaid statutory provisions would reveal that the jurisdiction of Income Tax Authorities may be fixed not only in respect of territorial area but also having regard to a person or classes of persons and income or classes of income also. Therefore, the CBDT having regard to the income as per return has fixed the jurisdiction of the Assessing Officers. The ld. Counsel in this respect has relied upon the CBDT Instruction No.1/2011 [F.No.187/12/2010-IT(A-I), for the sake of convenience is reproduced as under: "Instruction No.1/2011 [F.No.187/12/2010-IT(A-I), 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....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sessee and held that when the notice u/s 143(2) was issued by an officer who did not have jurisdiction to proceed with the assessment and the assessment was framed by the other officer who did not issue the notice u/s 143(2) before proceeding to frame the assessment, then such an assessment order was bad in law. The relevant part of the order passed in Bhagyalaxmi Conclave (P) Ltd. (supra) is reproduced as under: "5.2. The assessee relied on the recent decision of this Tribunal in the case of Hillman Hosiery Mills Pvt. Ltd. vs. DCIT, in ITA No. 2634/Kol/2019, order dated 12.01.2021. We find that the issues that arise in this appeal are clearly covered in favour of the assessee. This order followed the principles of law laid down in a number of other decisions of the ITAT, Kolkata Bench on this issue. 5.3. Kolkata "B" Bench of the Tribunal in the case of Hillman Hosiery Mills Pvt. Ltd.(supra) held as follows: "10. In this case, the ITO Ward-3(3), Kolkata, issued notice u/s 143(2) of the Act on 04/09/2014. In reply, on 22/09/2014, the assessee wrote to the ITO, Ward-3(3), Kolkata, stating that he has no jurisdiction over the assessee. Thereafter on 31/07/20....
X X X X Extracts X X X X
X X X X Extracts X X X X
....and circumstances of the case, perusal of the papers on record, orders of the authorities below as well as case law cited, I hold as follows:- 8. I find that there is no dispute in the fact that the notice u/s 143(2) of the Act dt. 29/09/2016 has been issued by the ITO, Wd-1(1), Durgapur. Later, the case was transferred to the jurisdiction of the ACIT on 11/08/2017. Thereafter, no notice u/s 143(2) of the Act was issued by the Assessing Officer having jurisdiction of this case and who had completed the assessment on 26/12/2017 i.e., ACIT, Circle-1(1), Durgapur. Under these circumstances, the question is whether the assessment is bad in law for want of issual of notice u/s 143(2) of the Act. 9. This Bench of the Tribunal in the case of Shri Sukumar Ch. Sahoo vs. ACIT in ITA No. 2073/Kol/2016 order dt. 27.09.2017, held as follows:- "5. From a perusal of the above Instruction of the CBDT it is evident that the pecuniary jurisdiction conferred by the CBDT on ITOs is in respect to the 'non corporate returns' filed where income declared is only upto Rs. 15 lacs ; and the ITO doesn't have the jurisdiction to conduct assessment if it is above Rs 15 la....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the pecuniary jurisdiction to issue notice he duly transferred the file to the ACIT, Circle-27, Haldia on 24.09. 2014 when the ACIT issued statutory notice which was beyond the time limit prescribed for issuance of notice u/s. 143(2) of the Act. We note that the ACIT by assuming the jurisdiction after the time prescribed for issuance of notice u/s. 143(2) of the Act notice became qoarum non judice after the limitation prescribed by the statute was crossed by him. Therefore, the issuance of notice by the ACIT, Circle-27, Haldia after the limitation period for issuance of statutory notice u/s. 143(2) of the Act has set in, goes to the root of the case and makes the notice bad in the eyes of law and consequential assessment order passed u/s. 143(3) of the Act is not valid in the eyes of law and, therefore, is null and void in the eyes of law. Therefore, the legal issue raised by the assessee is allowed. Since we have quashed the assessment and the appeal of assessee is allowed on the legal issue, the other grounds raised by the assessee need not to be adjudicated because it is only academic. Therefore, the additional ground raised by the assessee is allowed. 7. In the result,....
X X X X Extracts X X X X
X X X X Extracts X X X X
....92BB would be a complete answer. On the other hand, Mr. Ankit Vijaywargia, learned Advocate, appearing for the Respondent submitted that the notice under Section 143(2) of the Act was never issued which was evident from the orders passed on record as well as the stand taken by the Appellant in the memo of appeal. It was further submitted that issuance of notice under Section 143(2) of the Act being prerequisite, in the absence of such notice, the entire proceedings would be invalid. 8. The law on the point as regards applicability of the requirement of notice under Section 143(2) of the Act is quite clear from the decision in Hotel Blue Moon's case (supra). The issue that however needs to be considered is the impact of Section 292BB of the Act. 9. According to Section 292BB of the Act, if the assessee had participated in the proceedings, by way of legal fiction, notice would be deemed to be valid even if there be infractions as detailed in said Section. The scope of the provision is to make service of notice having certain infirmities to be proper and valid if there was requisite participation on part of the assessee. It is, however, to be noted that the Secti....