TaxTMI 
TaxTMI 
2025 (6) TMI 2044
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....alued at Rs. 39,62,714/-, time deposit of Rs. 30,36,720/-, TDS statement interest other than interest on securities of Rs. 3,56,823/- and TDS statement, payment made to non-resident u/s 195 of Rs. 2,28,760/-. From the e-filing portal of the department it was noticed that the Assessee had filed return of income for the year under consideration which caused escapement of income from assessment to the tune of Rs. 75,85,076/-. The case of the Assessee was reopened within the provision of section 147 of the Act by issuing notice u/s 148 of the Act dated 20.04.2022. The Assessee filed return of income in response to notice issued u/s 148 of the Act on 11.05.2022 declaring income of Rs. 5,85,620/-. Further, statutory notices u/s 142(1) of the Act dated 21.04.2024, 11.03.2023 and notice u/s 133(6) of the Act dated 08.04.2023 and 30.10.2023 were issued and served upon the Assessee. The Assessee has filed part reply to these statutory notices and therefore show cause notice dated 15.03.2024 was issued and served upon the Assessee wherein the Assessee failed to avail the opportunity of filing submissions/explanation. The Assessee failed to comply with any of the statutory notices issued durin....
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....stment to the extent of Rs. 36,12,173/- with proper documentary evidence. Therefore, the addition to the extent of Rs. 36,12,173/- u/s 69 of the Act in respect of investment in property is sustained. The objections are accordingly partly allowed." 5. In view of the directions issued by the Ld. DRP the final assessment order was passed and the total income of the Assessee was assessed to Rs. 41,97,790/- wherein the addition u/s 69 of the Act was made to the tune of Rs. 36,12,173/-. 6. Aggrieved by the impugned order, the Assessee is in appeal before this Tribunal by raising following grounds of appeal: "1. On the facts and circumstances of the case and in law, the ITO, Ward 34(3)(5), Mumbai was not having the jurisdiction over the appellant as he was a non-resident during the year and, therefore, he has erred in passing the order u/s. 148A(d) and also issuing the notice u/s. 148. 2. On the facts and circumstances of the case and in law, the ITO, Ward 34(3)(5), Mumbai has erred in passing the order u/s. 148A(d) and also issuing the notice u/s. 148 without appreciating that he was not having the jurisdiction for the same in view of Section 151A and the notifica....
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.... impugned show cause notice u/s 148A(b) of the Act and notice u/s 148 of the Act are liable to be set aside. In support of his argument, the Ld. A.R. has relied on the case of Jurisdictional High Court of Mumbai in Nimir Kishore Mehta vs. Assist. Commissioner of Income Tax reported as (2024) 161 taxmann.com 553 (Bom.) order dated 28.03.2024. 10. The Ld. D.R., while opposing the argument of the Ld. A.R., has submitted that the issuance of notice u/s 148 of the Act is not an illegality but a mere irregularity having no impact on the assessment and has referred and relied on the section 292BB of the Act in support of his argument stating that in the facts and circumstances of the case, the notice issued by the AO in this case shall be deemed to be valid notice by virtue of section 292BB of the Act. It is therefore argued that since the Assessee has appeared in the proceedings/enquiry relating to the assessment therefore it shall be deemed that the notice u/s 148 of the Act has been duly served upon him in accordance with the provision of the Act and he is precluded from taking any objection in that regard. 11. The Ld. A.R., in rebuttal to the argument of the Ld. D.R., has submit....
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....tion 2(7A) of the Act, viz. such authority who was vested with the relevant jurisdiction by virtue of any directions or orders issued under subsection (1) or sub-section (2) of Section 120 of the Act or any other provision of the Act; or any such authority who was directed under clause (b) of subsection (4) of Section 120 to exercise or perform all or any of the powers and functions conferred on, or assigned to, an Assessing Officer under the Act; therefore, no obligation was cast upon the assessee to call in question his jurisdiction on receipt of notice u/s. 148, dated 09.03.2018 from him. My aforesaid conviction that where an assessee is in receipt of notice from an officer who was not vested with the jurisdiction over the case of the assessee either u/s. 124(1) or u/s. 127 or by notification or circular or instruction of CBDT, then, no obligation would be cast upon the assessee to call in question his jurisdiction as per the mandate of sub-section (3) of Section 124 of the Act is supported by the orders of the co-ordinate benches of the Tribunal, i.e, ITAT, Gauhati in the case of Balaji Enterprise Vs. ACIT (2021) 187 ITD 111 (Gau.) and the ITAT, Kolkata Bench in the case of OSL....
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....ssessing Officer has jurisdiction to assess any person, such question shall be determined by the authority prescribed under the said subsection. Sub-section (3) of section 124 provides time limits for a person to call in question jurisdiction of an Assessing Officer. Clause (c) of sub- section (3) of section 124 provides that no person shall be entitled to call in question jurisdiction of an Assessing Officer where an action has been taken under Section 132 or section 132A, after the expiry of one months from the date on which he was served with a notice under sub- section (1) of Section 153A or sub-section (2) of Section 153C of the Act or after the completion of the assessment, whichever is earlier. In clear terms, the time limit for raising objection to the jurisdiction of the Assessing Officer prescribed under sub-section (3) of section 124 has a relation to the Assessing Officer's territorial jurisdiction. The time limit prescribed would not apply to a case where the assessee contends that the action of the Assessing Officer is without authority of law and, therefore, wholly without jurisdiction." On the basis of our aforesaid deliberations, I am of the considered....
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.....355/405 ITR 1/2018 SCC Online Delhi 9435 submitted that the objections as to the jurisdiction of AO cannot be equated with lack of subject matter jurisdiction and therefore, the fact that Respondent No. I has issued a notice under Section 148A(b) of the Act, cannot be fatal. In our view, this judgment does not help in the case of Respondents-Revenue because that was a case where the AO had concurrent jurisdiction. That was not a case where per-se there was lack of jurisdiction. 12. This Court in Pavan Morarka v. Asstt. CIT [2022] 136 taxmann.com 2 following M.I. Builders (P.) Ltd. ((supra)) has held that a notice issued by an officer who did not have jurisdiction over Assessee, would be invalid. Paragraph No. 16 of the said judgment reads as under: "16. Respondent's stand that the Assessing Officer at New Delhi had issued a notice under section 148 of the said Act on petitioner on 22nd March 2013 before the limitation period expired and, therefore, the impugned notice issued by the Assessing Officer at Mumbai in continuation of the said proceedings must also be treated as valid and within time is misconceived. This is because we notice that the notic....
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....ing Additional CIT, Range-1, Lucknow and other being ACIT, Range-IV, Lucknow. In these backgrounds, the Tribunal has rightly held that the issuance of notice under Section 148(1) of the Act by the ACIT, Range-IV, Lucknow was without jurisdiction." 14 In the circumstances, the fact that Petitioner has been filing returns as a Non-resident, cannot be disputed. The fact that the Petitioner, cannot be disputed. over 15. The further point is Respondent No. 1 has also in effect admitted that he has no jurisdiction over Assessee, but he issued the notice because the information and PAN of Assessee were transferred to the charge of Respondent No. 1 at the fag end of March 2023 for issuing notice under Section 148A(b) of the Act and it was getting time barred by limitation on 31 March 2023. He also admits that it has come to his knowledge that Assessee is an NRI when the reply to notice under Section 148A(b) of the Act was made. Notwithstanding that Respondent No. 1 did not migrate the PAN also of Assessee to the concerned AD because according to him, the time was short and notice stage only prima-facie reasons are adequate and it is not necessary to give a conclusive find....
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.... purchased during the year. The source of funds was out of the maturity proceeds of fixed deposits. Following documents are attached for your reference: i. Bank statement showing maturity of fixed deposits and payments against purchase of property. ii. Computation of Income for the year. iii. Income tax paid challan. iv. Agreement of property purchased. I request you to consider this as an error of estimation and close the proceedings. Yours faithfully, Sanand Sankardas." 14. Further, we have noticed that in the order u/s 148A clause (d) of the Act dated 20.04.2022 in para No.4, the AO has acknowledged the response to the notice by the Assessee that he was NRI for the relevant year. Therefore, it is not the case of the Revenue that the AO who has issued the impugned notice u/s 148 of the Act was not aware that the Assessee was NRI for the relevant year. Thus, we are of the considered opinion that in the arguments of the Ld. D.R. wherein he has tried to invoke section 292BB of the Act, because of the above discussion and the judicial precedent relied by the Ld. A.R., there is no merit found in the arguments f....