Assessment framed by AO having no territorial jurisdiction based on Postal Pin Code as per CBDT Notification quashed
ABCAUS Case Law Citation:
ABCAUS 3268 (2020) (02) ITAT
Important case law relied upon by the parties:
National Thermal Power Co. Ltd. vs. Commissioner of Income Tax (1998) 29 ITR 383 (SC)
Ramshila Enterprises Pvt. Ltd. vs. Principal Commissioner of Income-tax (20116) 383 ITR 546 (Cal)
Emami Infrastructure Ltd., vs. Commissioner of Income Tax
All Cargo Global Logistic Ltd. vs. DCIT (2012) 137 ITD 24 (Mum)
In the instant case, the assessee had challenged the order passed by the CIT(A) involving proceedings u/s 143(1) of the Income-tax Act, 1961 (the Act).
Before the Tribunal at the very outset, the assessee raised an additional ground challenging Assessing Officer’s territorial jurisdiction as per CBDT’s Notification defining jurisdiction as per the postal PIN Code.
It was pointed out that the assessee’s return was filed at a city in a State different from the City and State of which Assessing Officer (AO) had framed the impugned assessment.
The Revenue’s case on the other hand was that the assessee was stopped from challenging territorial jurisdiction at this belated stage wherein the lower authorities had framed the same as per law.
Assessment without jurisdiction as per Postal Pin Code quashed
The Tribunal noted that the Hon’ble Supreme Court’s landmark decision which was followed by the ITAT holds that an additional ground can very well be allowed to be raised before the tribunal in order to determine correct taxable income provided all the relevant facts are on record.
The Tribunal noted out that the assessee had already filed the necessary details in its return filed in different city. Further the department’s record also suggested that the assessee’s jurisdiction was in the city only where the ITR was filed. These facts made it sufficiently clear that impugned assessment suffered from the lack of territorial jurisdiction.
The Tribunal further noted that the coordinate Bench of the Tribunal had noted that such a lacuna is fatal to the Revenue’s case. In the said case, the Coordinate Bench was dealing with a case involving challenge to the assumption of jurisdiction u/s 263 of the case by the Commissioner of Income Tax (CIT).
When the notice u/s 263 of the Act was issued, the CIT was having jurisdiction over the assessee. However subsequently the CBDT had issued a notification whereby the jurisdiction over the assessee had been transferred to different CIT on the basis of Pin Code where the registered office of the assessee was situated. Accordingly the ITAT had held that the order passed u/s 263 of the Act was without jurisdiction over the assessee.
Accordingly, the Tribunal adopting the abovesaid reasoning quashed the impugned assessment being suffering from lack of territorial jurisdiction.
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