ITAT authorised to consider question of jurisdiction raised first time and not raised earlier as it goes to the root of the matter and substantially affects the rights of assessee
ABCAUS Case Law Citation:
ABCAUS 3111 (2019) (08) ITAT
Important case law relied upon by the parties:
National Thermal Power – 229 ITR 383
The instant appeal had been filed at the instance of the assessee against the order of the Commissioner of Income Tax (Appeals) arising in the assessment order passed by the Assessing Officer (AO) under s. 143(3) r.w.s. 147 of the Income Tax Act, 1961 (the Act).
The assessee had also filed additional ground challenging the jurisdiction assumed u/s 147 of the Act. It was stated that through oversight, the assessee could not raise the question in the original appeal memo.
It was stated that being a legal ground, it could be raised before ITAT as per decision of Hon’ble Supreme Court.
The assessee requested for admission of additional ground concerning jurisdiction issue raised with reference to Section 147 of the Act. It was admitted that the issue challenging the jurisdiction was not raised before the lower authorities. The assessee insisted that the legality of jurisdiction can be raised before the Tribunal for the first time as the relevant facts were available on record.
The Department, on the other hand, submitted that the issue raised in the additional ground towards legality of jurisdiction had not been examined by the lower authorities and therefore it will not be proper for the Tribunal to examine the issue for the first time without taking cognizance of the observations of the lower authorities on this score.
ITAT authorised to consider question of jurisdiction raised first time
The Tribunal observed that the issue was neither raised before the AO nor before the CIT(A). The Tribunal stated that it is well settled that the provision which confers the jurisdiction for assessment and re-assessment could never be waived for the simple reason that the jurisdiction could neither be waived nor created by consent. The Tribunal is not prevented from considering the question of law towards jurisdiction although not raised earlier.
The Tribunal opined that the question of inherent lack of jurisdiction to re-open a case goes to the root of the matter and substantially affects the rights of the assessee if the illegal proceeding on the basis of wrongful usurpation of jurisdiction is allowed to continue.
The Tribunal opined that the assessee was entitled to plead lack of jurisdiction for the first time before the Tribunal. However the Tribunal also observed that the pros and cons of the objections of the assessee with regard to jurisdiction required to be examined by the Revenue authorities to enable us to take an informed view on the issue.
Accordingly, the Tribunal restored the issue towards lack of jurisdiction to the file of the CIT(A) and directed the assessee to raise the objections in connection with the assumption of jurisdiction under section 147/148 of the Act.
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