Suman Garg, New Delhi vs Assessee

PER CHANDRAMOHAN GARG, J.M.

The above captioned appeal has been filed by the revenue against the

order of the CIT(A)-XXIV, New Delhi dated 17.09.2012 in Appeal No.

1 ITA No.5950/Del/2012 Asstt.Year: 2004-05

259/10-11 for AY 2004-05. The assessee has also filed Cross Objection to

the impugned order of the CIT(A).

ITA NO. 5950/D/2012

2. The revenue has raised following sole ground in this appeal:-

"On the facts and circumstances of the case, ld. CIT(A) has erred in-

(i) Quashing the order on technical ground of AO by not appreciating the fact that the assessee had neither during the assessment proceedings with the ITO Gobindgarh nor before the AO concerned had challenged the proceedings u/s 147/148 of the I.T. Act, 1961."

3. Apropos aforementioned ground, we have heard arguments of both

the sides. Ld. DR submitted that the CIT(A) has erred in quashing the

assessment order dated 27.12.2010 passed u/s 144/147 of the Income Tax

Act. Ld. DR further contended that the CIT(A) was not justified in ignoring

the fact that the assessee, neither during the assessment proceedings with

the ITO, Mandi Gobindgarh nor before the AO concerned, had challenged

the proceedings u/s 147/148 of the Act. Ld. DR finally prayed that the

impugned order of the CIT(A) may be set aside by restoring that of the AO.

4. Ld. AR replied that the first assessment u/s 144/147 was framed by

ITO Ward 26(1), New Delhi dated 30.11.2009 for AY 2004-05, making an

addition of Rs.2,50,000/- being accommodation entry received by the

appellant. The AR further submitted that the reasons for issue of notice u/s

2 ITA No.5950/Del/2012 Asstt.Year: 2004-05

148 were recorded by the ITO, Mandi Gobindgarh who issued notice on

23.4.2010 after due approval. The AR further pointed out that the assessee

wrote a letter to ITO, Mandhi Gobindgarh dated 14.5.2010 pointing out to

him that she was a regular assessee of ITO Ward 26(1), New Delhi and

requested to shift the case to ITO Ward 26(1), New Delhi who had

jurisdiction over the appellant. Ld. AR has further drawn our attention

towards operative part of the impugned order and submitted that no new

notice u/s 144(8) of the Act was issued by ITO Ward 26(1), New Delhi and

no reasons were recorded u/s 147 of the Act and the AO straightway issued

notices u/s 142(1) and 143(2) of the Act and proceeded with the

assessment which was finalised on 27.12.2010. Ld. AR submitted that the

assessment was framed by ITO without acquiring jurisdiction by issuance

of notice u/s 148 of the Act which was an incurable defect and, therefore,

the CIT(A) was quite justified in quashing the notice u/s 148 of the Act.

5. On careful perusal of above submissions of both the sides and from

careful perusal of the impugned order, we note that the CIT(A) has allowed

appeal of the assessee quashing notice u/s 148 of the Act with following

conclusion:-

"4.2 In the present case, the first assessment u/s. 144/147 was framed by ITO Ward 26(1), New Delhi on 30.11.2009 for A.Y. 2004-05, making an addition of Rs.2,50,000/- being accommodation entry received by the appellant. Thereafter, the reasons for issue of notice u/s.

3 ITA No.5950/Del/2012 Asstt.Year: 2004-05 148 were recorded by ITO, Mandi Gobindgarh who issued the notice on 23.04.2010 after approval issued by Addl. ClT, Range Mandi -Gobindgarh. Thereafter, the assessee wrote a letter to ITO, Mandi Gobindgarh dated 14.05.2010, pointing out to him that she was a regular assessee of ITO, Ward 26(1), New Delhi and requested him to shift the above case to ITO, Ward 26(1), New Delhi who had jurisdiction over the appellant. Accordingly, the case was transferred by ITO, Mandi Gobindgarh to ITO Ward 26(1), New Delhi vide letter No. ITO/Ward I/MGG/2010-11/13 dated 13.08.2010. I have carefully perused the assessment records of the case and found that no new notice u/s. 148 was issued by ITO Ward 26(1), New Delhi. He also did not record any reasons of his own. The AO straight-away issued notice u/s 142(1) and u/s. 143(2) of the Act and proceeded with the assessment. The assessment was finalized on 27.12.2010 for A.Y. 2004-05 by ITO Ward 26(1), New Delhi.

4.3 Thus, it is seen that the facts of the instant case are exactly similar to those of Rajender Prasad Gupta (supra)"

and Naseman Farms Pvt. Ltd. (supra). Notice u/s. 148 was issued by ITO, Mandi Gobindgarh, who did not have jurisdiction over the case. No notice u/s 148 was issued by the jurisdictional ITO, Ward 26(1), New Delhi, who had already completed the assessment once u/s. 144/147 of the Act for A.Y. 2004-05 on 30.11.2009. Thus, the assessment was framed by the jurisdictional ITO without acquiring jurisdiction by issue of notice u/s. 148. This is an incurable defect and therefore, the assessment framed by the AO without issue of proper notice u/s. 148 is void ab-initio and is therefore, quashed."

6. In view of above observations, findings and conclusion of the CIT(A),

we observe that the CIT(A) quashed notice u/s 148 of the Act issued by

ITO, Mandi Gobindgarh by holding that the assessment was framed by

jurisdictional ITO, Ward 26(1), New Delhi without acquiring jurisdiction by

issuance of notice u/s 148 of the Act which is an incurable defect. Ld. AR

could not place any material or fact before us to hold that the assessment 4 ITA No.5950/Del/2012 Asstt.Year: 2004-05

was framed by the jurisdictional ITO after acquiring valid jurisdiction by

issuance of notice u/s 148, thus, we are unable to see any ambiguity,

perversity or any other valid reason to interfere with the impugned order

and we uphold the same. Accordingly, sole ground of the revenue being

devoid of merits is dismissed.

C.O. 162/Del/2013 of the assessee

7. Since by the earlier part of this order, we have dismissed the appeal

of the revenue against the order of the CIT(A) which quashed notice u/s

148 of the Act, therefore, C.O. of the assessee does not survive for detailed

adjudication on merits and we dismiss the same as infructuous in view of

above conclusion, as recorded above, dismissing the appeal of the revenue.

Accordingly, CO of the assessee is also dismissed as infructuous.

8. In the result, the appeal of the revenue as well as CO of the assessee

are dismissed.

Order pronounced in the open court on 27.1.2015.

Sd/- Sd/- (G.D. AGRAWAL) (CHANDRAMOHAN GARG) VICE PRESIDENT JUDICIAL MEMBER

DT. 27th JANUARY 2015 'GS'

5 ITA No.5950/Del/2012 Asstt.Year: 2004-05

Copy forwarded to:-

1. Appellant 2. Respondent 3. C.I.T.(A) 4. C.I.T. 5. DR By Order

Asstt. Registrar

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