A.E. FASHIONS (P) LTD.,DELHI V. ITO,WARD-1(1), FARIDABAD

ITA 483/DEL/2024

AI Insights

The case involves A.E Fashions (P) Ltd., the appellant, contesting an assessment order made by the Income Tax Officer, Ward 1(1), Faridabad, the respondent. The primary contention was the jurisdictional authority of the ITO in Faridabad to pass the assessment order for the Assessment Year 2011-12, despite the assessee's established presence and assessment in Delhi. The Tribunal examined the legal and factual matrix presented, including the change of address and jurisdiction communicated to various authorities, and found the actions of the ITO in Faridabad to be without legal jurisdiction.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 31045 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJEEV KUMAR JAIN
• Assessee Lawyers: ASHISH TRIPATHI
• Keywords: Set aside
• Section: 143(3); 154; 143(1); 22

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: ‘A’: NEW DELHI) BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER ITA No:-483/Del/2024 (Assessment Year- 2011-12) A.E Fashions (P) Ltd., 331, 1s t Floor, Press Street, Sadar Bazar, Delhi 110006 Vs. Income Tax Officer, Ward 1(1), Faridabad 122001, Haryana PAN No: AAACR7759N APPELLANT RESPONDENT Revenue by : Shri Rajeev Kumar Jain, CA Assessee by : Shri Ashish Tripathi, Sr. DR Date of Hearing : 12.03.2025 Date of Pronouncement : 21.03.2025 ORDER PER AMITABH SHUKLA, AM: This appeal by Assessee is directed against the order of National Faceless Appeal Centre, Delhi, [for short hereinafter referred to as the [“Ld. CIT(A)”] dated 08.12.2023 for Assessment Year 2011-12. 2.0 The assessee has raised altogether 14 grounds of appeal agitating addition of Rs. 1,36,00,000/- made by the Ld. AO in his order u/s 143(3) r.w.s. 147 dated 28.12.2018. Through the impugned grounds of appeal, the Ld. AO has contested the order both on legal grounds as well as merits of the addition made. The legal ground concerns jurisdictional insufficiency of the Ld. AO to pass the order on merits of the case the assessee has contested the addition being inadmissible given peculiar facts of the case. We would take the legal grounds raised by the assessee first, as the same lie at the root of the controversy. 3.0 Grounds of appeal no.l-7are regarding the jurisdictional insufficiency of the Ld. AO to passed the impugned assessment order. Explaining the brief factual Metrix of the case, the Ld. Council for the assessee submitted that it was assessed originally in Faridabad, Haryana, however the assessee has shifted its base to Delhi and had been assessed there by the department since 2009-10. It was submitted that for this year alone, inspite of clear information of the assessee being assessed in Delhi, the Ld. AO at Faridabad assumed illegal jurisdiction and passed the impugned assessment order u/s 143(3) r.w.s. 147 dated 28.12.2018. The Ld. Council as place on record a voluminous paper book to press its point that the Ld. AO at Faridabad did not have any Jurisdiction over him to pass any assessment order. Thus, the assessee has invited attention to page 36 of the paper Page 2 of 6 ITA No.-483/Del/2024 A.E Fashions (P) Ltd. book comprising order u/s 127 dated 22.11.2019 to show that assessee jurisdiction had shifted from ITO ward 1(1), Faridabad to ITO ward 1(4), Delhi. Further, the assessee has submitted evidences being correspondence with the Ministry of Corporate Affairs alluding the change of addressfrom Faridabad to Delhi (page 4 to 6 of paper book), copies of return of income for A.Y. 2010-11 to A.Y. 2017-18 having been filed from Delhi address (page no. 7 to 14 of paper book), correspondence with the Ld. AO dated 05.05.2018 indicating that assessee had objected to notice u/s 148 (page no. 22 of paper book) etc. It is the case of the assessee that inspite of these clear evidences, the objections of the assessee had been summarily overruled by the Ld. AO as well as the First Appellate Authority. The Appellant assessee has invited attention to the order u/s 154 for A.Y 2009-10 dated 05.12.2013 where again the Ld. AO admits that the assessee was operating from its Delhi address. Before us, the Ld. Council for the assessee has also filed an order u/s 143(1) dated 03.02.2015 for A.Y. 2014-15 which shows that the assesses was assessed by the revenue Qua its Delhi address. In view of the above, cogent evidences the assessee has argued that, the Ld. AO of Faridabad, Haryana had no jurisdiction to pass any order its case and that Page 3 of 6 ITA No.-483/Del/2024 A.E Fashions (P) Ltd. consequently the assessment order u/s 143(3) r.w.s. 147 dated 28.12.2018 deserves to be set aside. The Ld. DR would like to place reliance upon the order of lower authorities. 4.0 We have heard rival submission on the matter in the light of material available on records. We have noted that the assessee had shifted its base from Faridabad to Delhi. The fact of change of address was clearly, categorically, and timely communicated to all the authorities including Income Tax Authorities. Thus, jurisdiction over the assessee was shifted from ITO ward 1(1), Faridabad to ITO ward 1(4), Delhi. The assessee had been filing return of income from A.Y. 2010-11, from its Delhi address and the said fact was recognised by the department as evidenced from its orders mentioned supra. In this view of things, the action of the Ld. AO at Faridabad in acquiring jurisdiction over the assessee becomes questionable and rather illegal. To the extent the decision of Ld. CIT (A) in confirming AO’s order also becomes incorrect .Availability of a legally valid jurisdiction over a dispute with a quasi-judicial authority is sina qua non to exercise authority over the litigant. It is the basic principle of every jurisprudence. The same has been legally mandated so as to Page 4 of 6 ITA No.-483/Del/2024 A.E Fashions (P) Ltd. Page 5 of 6 ITA No.-483/Del/2024 A.E Fashions (P) Ltd. prevent unnecessary, adhoc and excessive authority of power by the state. It is settled principle of law that any order passed by an authority without possessing a legally valid jurisdiction cannot survive any judicial scrutiny and is bound to be quashed when reviewed by superior appellate authorities.We are therefore, of the considered view that ITO ward 1(1) Faridabad did not have any jurisdiction to issue notice u/s 148 dated 29.03.2018 and to pass corresponding u/s 143(3) dated 28.12.2018 in assessee case. Accordingly, we set aside the order of lower authorities and quash the order u/s 143(3) r.w.s 147 dated 28.12.2018 as the same has been found to be suffering from incurable jurisdictional insufficiency. The assessee therefore succeeds qua Grounds of appeal no. 1-7 raised by it in respect of legal grounds. 5.0 As the assessee has succeeded qua its legal grounds, the grounds of appeal 8 to 14 have become academic in nature. 6.0 In result the appeal of the assessee is allowed. -Sd/- ( Vikas aw asth y) JUDICIAL MEMBER -Sd/- (AMITABH SHUKLA) ACCOUNTANT MEMBER Dated: 2 1/03/2025. Page 6 of G ITA No.-483/Del/2024 A.E Fashions (P) Ltd. Copy forwarded to: 1 . Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 1. Date of dictation of Tribunal order 13.03.25 2. Date on which the typed draft Tribunal Order is placed before the Dictating Member 3. Date on which the typed draft Tribunal order is placed before the other Member 4. Date on which the approved draft Tribunal order comes to the Sr. PS/PS 5. Date on which the fair Tribunal order is placed before the Dictating Member for pronouncement 6. Date on which the signed order comes back to the Sr.PS/PS 7. Date on which the final Tribunal order is uploaded by the Sr.PS/PS on official website 8. Date on which the file goes to the Bench Clerk alongwith Tribunal order 9 Date of killing off the disposed of files on the judisis Portal of ITAT by the Bench Clerks 10. Date on which the file goes to the Supervisor (Judicial) 11. The date on which the file goes to the Assistant Registrar for endorsement of the order 12. Date of Despatch of the order "