2024 (11) TMI 426

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....der. The case law and judgments cited in the order does not apply in this case. The decision of the Apex court in the case of Homefinders Housing Ltd. Vs ITO (2018) 256 Taxman 59(SC) is also applicable since in this case order was already passed against the objections filed by the assessee. 2. Whether on the facts and circumstances of the case, Ld. CIT(A) has erred in law and facts by considering the approval given by the Pr. CIT was in a mechanical manner inspite of the facts that the approval was given by the Pr. CIT after application mind by giving his inference that "Yes, I find this case fit for the issue of notice u/s 148 of the Act, for reasons recorded by the AO and the undisclosed/Unexplained facts of Cash deposit of Rs. 1.00 Cr.". The case law CIT Vs S.Goyanka lime and Chemical Ltd. and other judgments cited in the order does not apply in this case. 3. The appellant craves to add, amend, modify or alter any grounds of appeal at any time or before hearing of the appeal. 3. In this case, there is a Cross Objection, i.e., C.O. No. 13/Chd/2022 filed by the Assessee. Grounds taken by the Assessee in his Cross Objection are as under:- 1. That the L....

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....ided the case on technical issue relating to issuance of Notice u/s 148 of the Income Tax Act, 1961 (in short 'the Act'). The relevant part of the findings given by the ld. CIT(A) in his order are as under: - "5.9 I find force in the various legal issues raised by the appellant. As per the records, notice u/s 148 of the Act has been issued without material on record, without investigation and on wrong information. The appellant also has quoted various judgments in support of his contention. The case was reopened u/s 148 with a reason that the assessee has given a sum of Rs. 1.00 Cr. to M/s M.S Continental Pvt. Ltd., the source of which is unexplained - why the same may not be treated as - income of the assessee. The information was received from investigation wing. And the approval was given by the Pr CIT that the amount of Rs. 2,08 Cr is unexplained. This shows complete non application of mind by the AO. .... Also, the AO has not passed a speaking order on the objections. The AO has summarily rejected the objections of the appellant which is against the legal proposition. Further on the merits, the appellant has brought material on recor....

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....hat application also, it has been stated, that the assessee is 'Non Resident' and permanently settled in USA and is having American Passport which is also a matter of record. 3. That the assessee had filed the original return for A.Y 2012-2013 on 18.01.2014, at nil income, in which, inadvertently the status had been mentioned as 'Resident'. 4. The assessee had filed return for A.Y 2011-12 on 28.11.2018 mentioning the status as 'Non-Resident Indian' (NRI). 5. Notices u/s 148 of the Act dated 28.2.2019 was issued by the ITO, Ward 3(4), Ludhiana though, it was well in the knowledge of the Department that the assessee is Non-Resident Indian as per the documents available in the record of the Assessing Officer, as stated above. 11. The ld. Counsel of the assessee argued that the Assessing Officer Ward-3(4) had wrongly assumed the jurisdiction by issuing notice u/s 148 and relied upon the judgment of the Chandigarh Bench of ITAT in the case of 'Sh. Manjit Singh vs. DCIT' reported in 81 ITR (Trib.) 454 and that judgment was also followed by the ITAT Delhi Bench in the case of Tarlok Singh in ITA No. 3955/Del/2018, vide order dated 08.12.2021, ....

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....d by the other Assessing Officer is squarely covered by the above order. He relied upon the following case laws: a) Mukesh Kumar Vs ITO, ITA No.2358/Del/2012 2015(6) TMI 1142, ITAT Delhi. "Validity of notice after case being transferred - Reopening of assessment - file transferred by ITO Ward-26(4) to ITO Ward -26(3) noticing jurisdiction over the appellant - Held that:- ITO Ward-26(3), New Delhi had proceeded with the framing assessment without issuing fresh notice u/s 148. It means that ITO Ward- 26(4), New Delhi had no valid jurisdiction over the appellant, at the time of issuing notice u/s 148 of the Act. In such circumstances, it was held by the Hon'ble Allahabad High Court in the case of CIT Vs. M/s MT Builders Pvt. Ltd., (2012) 349ITR 271 (All.) that the notice issued by an Officer who had no valid jurisdiction over the assessee is invalid. The notice under Section 148 of the Act issued by the Income Tax Officer, Ward-26(4) is non-est in the eyes of law since he had no valid jurisdiction over the appellant either territorial as notified under Section 124 of the Act or by transferring the case under the provisions of Section 127 of the Act. Now,....

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....urisdiction, but he issued notice because information and PAN of assessee were transferred to his charge at fag end of limitation period-Whether therefore, impugned notice issued under section 148A(b) was to be set aside-Held, yes [Paras 8 and 17] [In favour of assessee]" c) Saroj Sangwan Vs Income Tax Officer, ITAT Delhi Bench as reported in [2024] 162 taxmann.com 704 (Del.Trib.) "Section 148 of the Income-tax Act, 1961 - Income escaping assessment - Issue of notice for (Jurisdiction) - Assessment year 2011-12 - Assessee was resident of Gurgaon - Assessing Officer, Ward 69(1), New Delhi issued reopening notice in name of assessee - Subsequently, case of assessee was transferred to Assessing Officer, Ward 4(1), Gurgaon who completed reassessment - Assessee contended that since Assessing Officer, Ward 69(1), Delhi who issued reopening notice did not have jurisdiction to issue reopening notice, reassessment completed by Assessing Officer, Ward 4(1), Gurgaon was bad in law- Whether since Assessing Officer, Ward 69(1), Delhi who issued reopening notice had no jurisdiction over assessee, assumption of jurisdiction by him for reopening assessment by issue of notice unde....

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....t; therefore, the assessment made pursuant to such notice is bad in law. In support of this proposition we rely upon the cases of Hon'ble Apex Court- in the cases of Y. Narayana Chetty Vs. ITO, 35 ITR 388, 392 (SC); CIT Vs. Maharaja Pratap Singh Bahadur, 41 ITR 421 (SC); and CIT Vs. Robert, 48 ITR 177 (SC). In the light of the above . titled principle of law, we have no hesitation to quash the re-assessment it proceedings since there was no valid notice pursuant to which the reassessment proceeding was made in the present case. Accordingly, the appeal filed by the appellant is allowed." 16. Thus, considering the above facts and in case laws, we have no hesitation in holding that since the assessment has been framed by the AO of International Tax on the basis of notice u/s 148 issued by the non-jurisdictional AO, Ward-3(4), Ludhiana, the assessment as framed by the AO of International Tax is quashed. 17. Both the Department and the Assessee in their appeals have raised certain other grounds but since, we have quashed the assessment as framed by the Assessing Officer, International Tax, on the legal issue, the other grounds of appeal are not being adjudicated being academic....