TaxTMI 
TaxTMI 
2026 (2) TMI 1460
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....ated 15.12.2017 without any valid order of transfer u/s. 127 of the Act. That further, it was submitted by the Ld. Counsel that the assessment was completed by the ITO-2(2), Bhilai without issuance of any notice u/s.148 of the Act, therefore, in these set of facts, firstly, there is no mandatory valid order of transfer u/s. 127 of the Act for transferring the case of the assessee from ITO-2(1), Bhilai to ITO-2(2), Bhilai and secondly, the ITO-2(2), Bhilai before completing the assessment has not issued any notice u/s.148 of the Act. 4. The Ld. Sr. DR relied on the orders of the sub-ordinate authorities a/w. judgment of the Hon'ble High Court of Chhattisgarh in the case of Harish Kumar Chhabada Vs. Pr. Commissioner of Income Tax, TAXC No.138 of 2023, dated 08.10.2025. Also, the Ld. Sr. DR submitted a report dated 18.12.2025 which reads as follows: 5. Per contra, the Ld. Counsel for the assessee had filed written submissions submitting that the facts regarding the case of the assessee are substantially distinguishable from the facts of the case referred to by the Ld. Sr. DR. The relevant submission of the Ld. Counsel is extracted as follows: 6. In this regard, I refer to the....
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....ttedly taken by the designation of the A.O as per the address of the assessee to be ITO, Ward-3(1) appearing in the acknowledgment of the ITR filed on 22.02.2017 in the said assessment year, Page 8 9 of APB. Now if that be so, then the initiation of the proceedings of limited scrutiny i.e. with regard to the first notice u/s.143(2) of the Act issued by the ITO, Ward-4(5), Raipur suffers from valid jurisdiction, resultantly then subsequent assessment framed by the ITO, Ward-3(1), Raipur becomes invalid and non-est in the eyes of law. 3. Per contra, the Ld. Sr. Departmental Representative (for short 'DR') vehemently submitted that as per Section 124(3)(a) of the Act, if the assessee had any objection regarding the jurisdiction of the Assessing Officer, then the same could have been raised within one month from the date on which he was served with the notice u/s. 142(1) and 143(2) of the Act. However, in the present case, the assessee had failed to do so. The Ld. Sr. DR relied on the judgment of the Hon'ble Supreme Court in the case of DCIT (Exemption) & Ors. Vs. Kalinga Institute of Industrial Technology (2023) 151 taxmann.com 434 (SC), wherein the Hon'ble Apex Court has rul....
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....not be prevented from raising the same before any other appellate authority. Therefore, taking guidance from the aforesaid judicial pronouncement of the Hon'ble Apex Court, the contention regarding the issue of jurisdiction is held to be valid as had been raised by the assessee first time before the Tribunal. The decision of the Hon'ble Supreme Court in the case of DCIT (Exemption) & Ors. Vs. Kalinga Institute of Industrial Technology (supra) as has been relied on by the Ld. Sr. DR is clearly focused on the parameter of compliance. However, in the present case as demonstrated in the record, it is not that of compliance and rather, it is ambiguity in issuance of notice and denying an opportunity to the assessee as to whether he should respond to the ITO, Ward-4(5), Raipur or ITO, Ward 3(1), Raipur. There are plethora of judicial pronouncements wherein it had been held that the tax payer should be provided opportunity to prepare for his defence in timely and appropriate manner and if there is any ambiguity/confusion arising in the said hearing notice which prevents the assessee to defend himself, then such hearing notices and subsequent proceedings have to be struck down holding them....
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.... decided with reference to each case." 7. Rebutting the facts of the present case, it is noted as per the documents on record that the first notice u/s. 143(2) of the Act, dated 18.09.2017 was issued by the ITO, Ward 4(5), Raipur and thereafter, another notice u/s. 142(1) of the Act, dated 09.06.2018 was issued by the ITO, Ward-3(1), Raipur who had framed the assessment without any order of transfer as required u/s.127 of the Act by the Ld. Pr. CIT. Similarly, if it is to be accepted that the actual jurisdiction is with the ITO, Ward-3(1), Raipur then first notice u/s. 143(2) of the Act, dated 18.09.2017 which had been issued for initiating the scrutiny proceedings by the ITO, Ward-4(5), Raipur is definitely without a valid jurisdiction over the assessee. When the issuance of notice and framing of assessment order suffers from lack of jurisdiction as enshrined in the statute then all subsequent proceedings becomes non-est in the eyes of law. 8. I find that the Hon'ble Supreme Court in its recent order passed in the case of Union of India Vs. Rajeev Bansal (2024) 469 ITR 46 (SC) had, inter alia, observed that the order passed without jurisdiction is nullity. It was....
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..... Thus, the power of assessing officers to reassess is limited and based on the fulfilment of certain preconditions. (CIT Vs. Kelvinator of India Ltd.)" 9. With these observations, the assessment framed by the ITO-3(1) Raipur vide his order passed u/s.143(3) of the Act, dated 26.10.2018 in absence of an order of transfer u/s.127 of the Act having been passed by the Ld. Pr. CIT and without any issuance of notice by him u/s. 143(2) of the Act to the assessee, is held to be without jurisdiction, invalid and bad in law and thus, the same is quashed. 10. Needless to say, once the assessment has been quashed for want of valid assumption of jurisdiction then all the other proceedings subsequent thereto becomes non-est in the eyes of law. As the legal issue has been answered in favour of the assessee then the grounds on merits becomes academic. 11. As per the aforesaid terms the grounds of appeal raised by the assessee stands allowed. 12. In the result, appeal of the assessee is allowed." 9. Respectfully following the aforesaid decision on the same parity of reasoning, I hold that the assessment framed by ITO-2(2), Bhilai vide his order passed u....
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....here was restructuring in the jurisdiction vide Notification dated 15.11.2014 and the ultimate jurisdiction vested with ITO, Ward-2(1), Raipur and hence, in the case of the Harish Kumar Chhabbda Vs. Pr. CIT (supra), the jurisdictional A.O i.e. ITO, Ward-2(1), Raipur had passed the assessment order. However, in the case of the assessee, there is no restructuring. Thirdly, since there is no restructuring, the order u/s.127 of the Act is mandatory for transferring the case of the assessee from ITO, Ward-2(1), Bhilai to ITO, Ward-2(2), Bhilai. Since the judgment of the Hon'ble Jurisdictional High Court in the case of the Harish Kumar Chhabbda Vs. Pr. CIT (supra) is distinguishable on facts, therefore, the decision relied upon by the Ld. Sr. DR will not be of assistance to the Revenue. 10. In the result, appeal of the assessee is allowed. Order pronounced in open court on 04th day of February, 2026. ============= Document 1 -- Government of India, Ministry of Finance, Department of Revenue. OFFICE OF THE INCOMETAX OFFICER -1(1) AAYAKAR BHAWAN, OPPOSITE ATMANAND SCHOOL, KRISHNA TALKIES ROAD, RISALI, BHILAI, DIST: DURG (CHATTISGARH) Dated: 18/12/2025 F.NO. ITO-1(1)/BHI/Re....