AASHIYANA INFRASTRUCTURE DEVELOPMENT PVT LTD,NEW DELHI V. DCIT CIRCLE-1(1), NEW DELHI

ITA 8472/DEL/2019

AI Insights

The case involves Aashiyana Infrastructure Development P. Ltd., which appealed against the order of the Commissioner of Income Tax (Appeals)-32, New Delhi, for the assessment year 2008-09. The primary contention was the jurisdiction of the officer who passed the assessment order. The appellant argued that the Deputy Commissioner of Income Tax lacked jurisdiction as the monetary limit for such assessments, according to CBDT Instruction No.1/2011, was not met, and the order should have been passed by the Income Tax Officer. The Tribunal found that the necessary jurisdictional transfer order under section 127 of the Act was not present, leading to the conclusion that the assessment was void ab initio.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 705914 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2008-2009
• Other Referred Cases: Ashok Devichand Jain vs. UOI and Others, Vipul Mittal v. DCIT
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHISH TRIPATHI
• Assessee Lawyers: SALIL KAPOOR; ANANYA KAPOOR
• Keywords: Unexplained investment; Validity of assessment
• Section: 147; 148; 143(3)

Judgement Text

"आयकर अपीलीय अिधकरण िदʟी पीठ “ए”, िदʟी ŵी िवकास अव̾थी, Ɋाियक सद˟ एवं ŵी एस įरफौर रहमान, लेखाकार सद˟ क े समƗ IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A”, DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI S RIFAUR RAHMAN, ACCOUNTANT MEMBER आअसं.8472/ िदʟी /2019 (िन.व. 2008-09) ITA No. 8472/Del/2019 (A.Y. 2008-09) Aashiyana Infrastructure Development P. Ltd., 22/2B Tilak Nagar, New Delhi 110018 PAN: AAFCA-2236-A ...... अपीलाथᱮ/Appellant बनाम Vs. Deputy Commissioner of Income Tax, Circle 1(1), R.No 366, Dr. S.P Mukherjee, Civic Centre, Minto Road, New Delhi 110002 ..... ᮧितवादी/Respondent Assessee by : Shri Salil Kapoor, Ms. Ananya Kapoor, S/Shri Shivam Yadav & Tarun Chanana, Advocates Department by: Shri Ashish Tripathi, Sr. DR सुनवाई कᳱ ितिथ/ Date of hearing : 24/04/2025 घोषणा कᳱ ितिथ/ Date of pronouncement : : 04/07/2025 आदेश/ORDER PER VIKAS AWASTHY, JM: This appeal by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-32, New Delhi (hereinafter referred to as 'the CIT(A)') dated 27.08.2019, for assessment year 2008-09. 2. Brief facts of the case as emanating from records are: The assessee filed his return of income for AY 2008-09 declaring loss of Rs.10,97,461/-. The return of income was accepted u/s. 143(1) of the Act. Thereafter, a survey operation was carried out in the case of Shreeji Group of cases, the assessee is one of the group companies. During 2 ITA No. 8472/Del/2019 (A.Y. 2008-09) the course of survey operation it was gathered that Shreeji Group of Companies have received huge share capital/share premium from various entities. During the course of assessment proceedings, the Assessing Officer (AO) had issued notices to various parties to verify identity, creditworthiness and genuineness of the transactions. The assessee allegedly failed to prove identity of the following parties: Name of the Entity Amount (in Rs.) Share Capital Metalcity Construction (Kovai) P. Ltd. 20,00,000 Haculese Builders (Coimbatore) P. Ltd. 10,00,000 Texcity Construction (Kovai) Pvt. Ltd. 20,00,000 Sushil Software Pvt. Ltd. (MAPS Creation Pvt. Ltd.) 20,00,000 Ang. Finvest Pvt. Ltd. 10,00,000 Total 80,00,000/- 3. The AO made addition of Rs.80,00,000/- on account of unexplained investments. Further, the AO made addition of Rs.20,00,000/- on account of investment made from undisclosed sources. Aggrieved by the assessment order dated 15.03.2016 passed u/s. 147 r.w.s. 143(3) of the Act, the assessee filed appeal before the CIT(A), but remained unsuccessful. Hence present appeal by the assessee. 4. Shri Salil Kapoor, appearing on behalf of the assessee at the outset submitted that the assessee has raised an additional ground of appeal vide application dated 06.11.2024 challenging validity of assessment order as no notice u/s. 143(2) of the Act for AY 2008-09 was ever served upon the assessee. The ld. Counsel further submitted 3 ITA No. 8472/Del/2019 (A.Y. 2008-09) that the assessee is challenging validity of the assessment proceedings as the assessment order has been passed by the Assessing Officer without jurisdiction. The ld. Counsel placing reliance on the CBDT Instruction No.1/2011 dated 31.01.2011 submitted that as per aforesaid instructions, the monetary limit for assuming jurisdiction in respect of return of income filed up to Rs.30,00,000/- in the case of a corporate returns is with the Income Tax Officer (ITO). The assessee has filed return of income declaring loss of Rs.10,97,461/-. Therefore, the assessment order should have been passed by the ITO, whereas, in the case of the assessee, the assessment order has been passed by the Deputy Commissioner of Income Tax. Thus, the assessment order has been passed by an Officer who has no jurisdiction over the assessee. He further pointed that notice u/s. 148 of the Act was issued by Assistant Commissioner of Income Tax on 31.03.2015, whereas, as per the monetary limit specified as per the aforesaid instructions the notice should have been issued by the ITO having jurisdiction over the assessee. In support of his aforesaid arguments he placed reliance on the following decisions:- i. Ashok Devichand Jain, vs. UOI and Others in Writ Petition No. 3489 of 2019 decided on 08.03.2022 by Hon’ble Bombay High Court; & ii. Vipual Mittal v. DCIT in ITA No. 2850/Del/2019 for AY 2014-15 decided on 15.01.2025(ITAT Delhi). 5. Per contra, Shri Ashish Tripathi representing the department vehemently defended the assessment order and prayed for dismissing the additional ground raised by the assessee challenging jurisdiction of the Assessing Officer. The ld. DR submitted that since it was a survey operation the assessments of entire group must have been clubbed together, hence, the assessment order was passed by the DCIT. 4 ITA No. 8472/Del/2019 (A.Y. 2008-09) 6. Both sides heard, orders of the authorities below examined. The short issue for consideration before us at this stage is: Whether the Assessing Officer who passed the assessment order dated 15.03.2016 had jurisdiction to pass the assessment order in the case of assessee in light of Instruction No. 1/2011 (supra)? The CBDT vide aforesaid instructions has specified monetary limits for passing the assessment orders in the case of various assessees. The relevant extract of the said instructions is reproduced herein below:- Metro charges for the purpose of above instructions shall be Ahemedabad, Bangalore, Chennai, Delhi, Kolkata, Hyderabad, Mumbai and Pune.” 7. The case of the assessee is that since in the return of income the assessee has declared loss of Rs.10,97,461/-, the ITO had jurisdiction to pass the assessment order in the case of assessee, whereas the assessment order has been passed by the DCIT. When the ld. DR was confronted with the aforesaid instructions he sought time to ascertain the facts and also to place on record a copy of the order passed u/s. 127 of the Act, whereby the jurisdiction of the AO was changed from ITO to DCIT. As prayed for by the ld. DR time was granted to furnish copy of the order passed u/s.127 of the Act, if any. On the next date of hearing the ld. DR expressed his inability to furnish order u/s. 127 of the Act. In the absence of any order u/s. 127 of the Act transferring jurisdiciton from ITO to DCIT, we hold that the assessment order dated 15.03.2016 passed by the DCIT is without jurisdiction. Income Declared (Mofussil areas) Income Declared (Metro Cities) ITOs ACs/DCs ITOs DCs/ACs Corporate returns Upto Rs. 20 lacs Above Rs.20 lacs Upto Rs.30 lacs Above Rs.30 lacs Non-corporate returns Upto Rs.15 lacs Above Rs.15 lacs Upto Rs.20 lacs Above Rs.20 lacs 5 ITA No. 8472/Del/2019 (A.Y. 2008-09) 8. We further observe that the notice u/s. 148 of the Act dated 31.03.2015 (at page 100 of the paper book) was issued by Additional Commissioner of Income Tax. In light of aforesaid CBDT Instructions even the Officer issuing said notice was not having jurisdiction over the assessee. The Hon'ble Bombay High Court in the case of Ashok Devichand Jain vs. UOI (supra) in similar facts after referring to CBDT Instruction No. 1/2011(supra) had held that the notice issued u/s. 148 of the Act was without jurisdiction. If, the notice u/s. 148 of the Act is without jurisdiction, any proceedings arising from defective notice are void ab initio. 9. Similar view has been taken by the Coordinate Bench of the Tribunal in the case of Vipul Mittal vs DCIT (supra). In light of facts of the case and documents on record, we have no hesitation in holding that the assessment order dated 15.03.2016 passed u/s. 147 r.w.s 143(3) of the Act is without jurisdiction, hence, liable to be quashed. We hold and direct accordingly. 10. Since, the appeal of assessee is allowed on jurisdictional issue, the grounds assailing additions on merits have become academic, hence, not deliberated at this stage. 10. In the result, appeal of the assesse is allowed. Order pronounced in the open court on Friday the 04th day of July, 2025. Sd/- Sd/- (S RIFAUR RAHMAN) (VIKAS AWASTHY) लेखाकार सद᭭य/ACCOUNTANT MEMBER ᭠याियक सद᭭य/JUDICIAL MEMBER िदʟी/Delhi, ᳰदनांक/Dated 04/07/2025 NV/- 6 ITA No. 8472/Del/2019 (A.Y. 2008-09) ᮧितिलिप अᮕेिषतCopy of the Order forwarded to : 1. अपीलाथᱮ/The Appellant , 2. ᮧितवादी/ The Respondent. 3. The PCIT/CIT(A) 4. िवभागीय ᮧितिनिध, आय.अपी.अिध., िदʟी /DR, ITAT, िदʟी 5. गाडᭅ फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar) ITAT, DELHI "