BULLIONLINE LLP,NEW DELHI V. ACIT CIRCLE 43(1), DELHI, DELHI

ITA 4874/DEL/2025

AI Insights

The case involves Bullionine LLP, which appealed against three separate orders related to the assessment year 2017-18. The primary contention was the jurisdictional validity of the notice issued under section 143(2) of the Income Tax Act, 1961, by the Income Tax Officer (ITO) Ward 6[1], Chandigarh. The assessee argued that the ITO did not have jurisdiction over their case as their registered office was in Delhi, not Chandigarh. The Tribunal found that the notice was issued without proper jurisdiction, leading to the quashing of the assessment order and related proceedings.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 833995 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2017-2018
• Appeal Filed On: 08-08-2025
• Other Referred Cases: Sunworld Infrastructure P Ltd (2015) 64 taxmann.com 471(Delhi), Nirmal Gupta vs PCIT [ITA No. 108/DEL/2018] [Dt. 22/06/2021], WSP Consultants India (P.) Ltd. vs PCIT [2024] 161 taxmann.com 559 (Delhi - Trib.)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: OM PRAKASH
• Assessee Lawyers: SATYAJIT GOEL
• Keywords: Condonation of delay; Set aside; Period of limitation; Assessment record; Revision of order
• Section: 143(3); 263

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘C’ BENCH, NEW DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER, AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA No. 4873/DEL/2025 [A.Y 2017-18] ITA No. 4874/DEL/2025 [A.Y 2017-18] ITA No. 4875/DEL/2025 [A.Y 2017-18] Bullionline LLP Vs. The P.C.I.T. B/3, C-1-2-3, PP Tower The ACIT, Circle-43[1] Netaji Subhash Place Delhi PiItampura, Delhi PAN – AAPFB 5596 F (Assessee) (Respondent) Assessee By : Shri Satyajit Goel, Adv Shri Rajat Garg, CA Department By : Shri Om Prakash, Sr. DR Date of Hearing : 25.11.2025 Date of Pronouncement : 04.02.2026 PER BENCH :- The above captioned three separate appeals by the same assessee are preferred against separate orders of the NFAC, Delhi dated 26.03.2022, 12.06.2025 and 07.06.2025 each pertaining to A.Y 2017-18, respectively. Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 2 of 13 2. Since the above three appeals pertain to same assessee and involve common issues, they were heard together and are disposed of by this common order for the sake of convenience and brevity. The bone of dispute in ITA No. 4875/DEL/2025 is the assessment order u/s 143(3) dated 27.12.2019 for AY 2017-18; in ITA No. 4873/DEL/2025 it is against the order of PCIT u/s 263 of the Act dated 26.03.2022 for AY 2017-18 and in ITA No. 4874/DEL/2025, it is the order of the AO u/s 143(3) r.w. 263 dated 28.03.2023 which gave effect to the PCIT order u/s 263 dated 26.03.2022. Since the decision on the original assessment made u/s 143(3) in the case for AY 2017-18 would impact the outcome in the other two appeals, we decided to take up the appeal in ITA No. 4875/DEL/2025 first. 3. The ld. counsel for the assessee has filed an application for condonation of delay in all the 3 appeals. 4. There is a delay of 1,172 days. Having perused the condonation petition and the affidavit, we find that the reason for delay in filing the appeals is that proper professional advice was not obtained. We find that the assessee has sufficient cause for not filing the appeal in time. Accordingly, we condone the delay and admit the appeals. 5. Briefly stated, the facts of the case are that Bullionline LLP, the assessee in the present case, is a limited liability partnership firm Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 3 of 13 incorporated on 07.10.2014 and is engaged in manufacturing/trading /export of gold jewelry and gold bars. The assessee firm is registered at the Registrar of Companies, Delhi. The assessee filed its return of income for the AY 2017-18 declaring total income at Rs. 3,02,69,970/- The return of income was subjected to scrutiny and an order u/s 143(3) of the Income-tax Act, 1961 [the Act, for short] was passed on 27.12.2019 determining the total income at Rs.6,32,96,552/- making addition of Rs. 3,30,26,582/ on account of various heads. ITA 4875/D/25 for AY 2017-18 6. At the very outset, the ld. counsel for the assessee took up the ITA 4875/D/25 for AY 2017-18, being the appeal against original assessment u/s 143(3) which was subsequently subjected to revisionary proceedings u/s 263. The ld pointed out to Ground No. 2 of appeal and contended that the initiation of assessment proceedings by way of issuance of notice u/s 143(2) is illegal and without jurisdiction. The assessee's main contention is that the initiation of assessment proceedings by the then ITO 6[1] Chandigarh, assuming jurisdiction for issuance of notice dated 08.08.2018 u/s 143(2) of the Act, was not valid as he was not having jurisdiction over this case. It was further stated that the company was incorporated on 07.02.2014 and registered the same at Delhi address. Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 4 of 13 The assessee also filed return of income for AY 2017-18 declaring income of Rs. 3,02,69,972/-, with the Delhi address. 7. The ld AR submitted that subsequently the case was selected for scrutiny through CASS and accordingly notice u/s 143(2) of the Act dated 08.08.2018 was issued by the office of the ITO, Ward 6(1), Chandigarh. As per PAN jurisdiction history from ITBA Portal, the PAN was allotted on 12.10.2015. Further, in response of notice u/s 143(2) of the Act, assessee filed his reply through e-filling portal on 24.08.2018 objecting to the assumption of jurisdiction by ITO, Ward 6(1), Chandigarh. The assessee stated that its jurisdiction must fall in the state of Delhi as their registered office is situated in Delhi and that they do not have any business in Chandigarh nor any branch office is situated in Chandigarh. 8. The ld AR stated that after considering the request of the assessee, ITO, Ward 6(1), Mohali transferred the case to ITO, Ward 40(3), New Delhi vide letter dated 26.07.2019 as per jurisdiction over the case. After receiving the scrutiny folder of the assessee on 01.08.2019, ITO, Ward 40(3), Delhi vide letter dated 01.08.2019, informed the ITO, Ward 6(1), Mohali that the jurisdiction over the case of the assessee lies with the ACIT, Circle 40(1), New Delhi as the income of the assessee exceeded Rs. 20 lacs and therefore, the PAN of the assessee be migrated to the concerned charge. Further, after transferring the PAN to ACIT, Circle Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 5 of 13 40(1), New Delhi, the ITO, Ward 40, New Delhi transferred the scrutiny folder of the assessee to ACIT, Circle 40(1), New Delhi. 9. The ld. counsel for the assessee finally argued that the notice u/s 143(2) of the Act dated 08.08.2018 issued by the ITO, Ward 6(1), Chandigarh is therefore without jurisdiction. The ld AR forcefully submitted that the assessment made by the ACIT, Circle 40(1), Delhi is without assumption of proper jurisdiction and therefore, the same may be quashed as void ab initio. The ld AR relied on the decision of Delhi High Court in the case of Sunworld Infrastructure P Ltd (2015) 64 taxmann.com 471(Delhi). 10. Per contra, the ld. DR strongly contended that that PAN of the assessee company was got allotted on 12.10.2015 which lied under the jurisdiction of ITO Ward 6[1], Chandigarh. This fact was duly in the knowledge of the assessee company. It is also apparent from the copy of ITR for this assessment year 2017-18, placed at page 2 of the assessee's own paper book; thus jurisdiction remained with same Assessing Officer. Even at the time of selection of this case for scrutiny under CASS the jurisdiction over this case was with same ITO Ward 6[1] Chandigarh, who very rightly issued the first statutory notice u/s 143[2] of the Act on 08.08.2018. Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 6 of 13 11. The ld. DR continued by saying that when a PAN shows the wrong jurisdiction, it is the concerned taxpayer's primary responsibility to initiate a correction process with the Income Tax Department to migrate it to the correct Assessing Officer. This is essential for smooth communication, assessment, and resolution of any tax-related issues. This is necessary because an incorrect jurisdiction can lead to notices and communications being sent to the wrong office, causing delays or missed deadlines and also difficulty in resolving issues such as outstanding demands, refund inquiries, or scrutiny, as the local Assessing Officer cannot assist until the jurisdiction is correctly transferred. Potential penalties or legal issues due to non-compliance with the correct jurisdictional Assessing Officer's requests can also emerge. However, still the Assessee Company did not discharge that responsibility for the reasons best known to them. In view of the above the ld. DR submitted that the assessment was very much initiated with correct jurisdiction and it needs to be confirmed. 12. Finally, the ld. DR concluded that at time of completion of assessment proceedings, the territorial jurisdiction of the case lies with ACIT, Circle 43(1), New Delhi. Therefore, proceedings u/s 263 of the Act and further 263/143(3) of the Act are valid. Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 7 of 13 19. We have heard the rival submissions and have perused the relevant material on record. We find from the report of the Assessing Officer that the assessee challenged the jurisdiction of the ITO, Ward-6(1), Chandigarh vide its communication dated 24.08.2018 i.e., within a month of the issuance of notice u/s 143(2) dated 08.08.2018. Thereafter, the ITO, Ward 6(1), Mohali transferred the case to ITO, Ward 40(3), New Delhi through vide letter dated 26.07.2019 as per jurisdiction over the case. Since the pecuniary jurisdiction belonged to the ACIT, Circle 40(1), New Delhi, the ITO, requested Ward 6(1), Mohali to migrate PAN of the assessee to ACIT, Circle 40(1), New Delhi. Thereafter, the scrutiny folder was transferred to ACIT, Circle 40(1), New Delhi through transfer Memo dated 06.08.2019. 20. These being the admitted facts, the issue for adjudication is whether issuance of notice u/s 143(2) of the Act was made by the correct Assessing Officer having jurisdiction over the assessee. 21. We find that for A.Y 2017-18, the time limit for issuing notice u/s 143(2) was 30.09.2018. ITO Ward 6[1], Chandigarh issued notice u/s 143(2) within the time limit on 08.08.208. However, it is to be seen as to whether the ITO Ward 6[1], Chandigarh had jurisdiction over the assessee’s case. We find that immediately after receipt of notice u/s 143(2) of the Act from the ITO Ward 6[1], Chandigarh, the assessee Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 8 of 13 raised objection regarding assumption of jurisdiction on 24.08.2018. The department still had time till 30.09.2018 to issue notice u/s 143(3) of the Act by the jurisdictional office being ACIT, Circle 40(1), New Delhi. We find that the record/scrutiny folder was handed over to the correct office having jurisdiction over the assessee only on 06.08.2019. 22. Here also, we note that it was merely the records which were transferred from ITO Ward 6[1], Chandigarh to ACIT, Circle 40(1), New Delhi. We do not find any transfer order u/s 127 of the Act which indicates that all throughout, the jurisdiction over the assessee lied with the ACIT, Circle 40(1), New Delhi. We also note that since the case records were handed over to the ACIT, Circle 40(1), New Delhi on 06.08.2019, he had no occasion to issue fresh notice u/s 143(2) of the Act as the date of issuance of valid notice u/s 143(2) expired on 30.09.2018. 23. In that view of the matter, we have no hesitation to hold that the purported notice u/s 143(2) issued on 08.08.2018 was without jurisdiction and cannot be held as a valid notice. ACIT, Circle 40(1), New Delhi having jurisdiction over the assessee never issued any notice u/s 143(2) of the Act and in any case, he could not have issued notice within time u/s 143(2) of the Act as he himself received the records on 06.08.2019. Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 9 of 13 24. We are fortified in our decision by the decision of the Hon'ble Delhi High Court in the case of Sunworld Infrastructure [P] Ltd (supra) wherein in identical facts, the Hon'ble High Court held that the issuance of notice u/s 143(2) was not from jurisdictional AO and hence quashed the notice/assessment as under: “The learned counsel for the respondent submitted that the impugned notice was not time-barred inasmuch as it was in continuation of an earlier notice under Section 143(2) issued by the Income Tax Officer, Ward-12(2), Bangalore on 10.09.2013. But, in our view, this does not save the impugned notice under Section 143(2). The reason for this is that the purported notice dated 10.09.2013 issued under Section 143(2) by the Assessing Officer at Bangalore was without jurisdiction inasmuch as the Assessing Officer at New Delhi had jurisdiction over the case. This fact was immediately pointed out by the assessee/petitioner by virtue of its letter dated 17.09.2013 where it had clearly indicated that it was regularly filing returns in Delhi and that the jurisdiction of the case was in Delhi. On this basis, it was requested that the said notice issued by the Bangalore office be withdrawn. Thereafter, the Income Tax Officer, Ward-6(1) (1), Bangalore wrote to the Income Tax Officer, Ward-24(3), New Delhi on the subject of transfer of scrutiny assessment records in the case of the petitioner. The said letter reads as under:- ****** 4. It is evident from the aforesaid letter that it is only the records of the case which were transferred and if the case itself had been transferred, the same would have to be directed under Section 127 of the said Act. No such order of transfer has been made and the above letter dated 16.12.2014 is indicative of the fact that the Bangalore Office of the Income Tax Department did not have jurisdiction in this case. 5. That being the position, the purported notice under Section 143(2) issued on 10.09.2013 was one without jurisdiction and cannot be regarded as a valid notice. The first notice, therefore, which was issued by an Officer having jurisdiction was on 24.12.2014. This was Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 10 of 13 issued clearly beyond the period of limitation which has been prescribed, i.e., beyond 30.09.2013 in this case. As such, the impugned notice dated 24.12.2014 issued under Section 143(2) of the said Act is barred by time. The same is quashed. 25. In view of the above discussion and judicial precedence, we are of the considered view that the impugned notice dated 08.08.2018 has been issued by the Assessing Officer having no jurisdiction over the assessee and therefore, the same is invalid rendering the resultant assessment order u/s 143(3) as bad in law. Accordingly, the assessment order dated 27.12.2019 is hereby quashed. Since we have quashed the assessment order on legal grounds, we do not find it necessary to dwell into the merits of the case. 26. In the result the appeal of the assessee in ITA No. 4875/DEL/2025 is allowed. ITA No. 4873/DEL/2025 [A.Y 2017-18] 27. The grounds raised by the assessee in this appeal is in respect of assumption of jurisdiction u/s 263 of the Act over a case whose assessment order passed u/s 143(3) has been held as invalid, as being unsustainable and bad in law. The assessee has relied upon decision of Delhi ITAT in the case of Nirmal Gupta vs PCIT [ITA No. 108/DEL/2018] [Dt. 22/06/2021] and WSP Consultants India (P.) Ltd. vs PCIT [2024] Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 11 of 13 161 taxmann.com 559 (Delhi - Trib.) which has held that non-est notice u/s 143(2) nullifies the 263 proceedings. 28. We have discussed and decided the issue herein above while dealing with ITA No. 4875/DEL/2025 that the assessment order u/s 143(3) dated 27.12.2019 has been quashed being result of wrong assumption of jurisdiction for issuance of notice u/s 143(2) of the Act. We are of the considered view that once the assessment order for AY 2017-18 has been quashed herein above, the same has become non-est and void order which cannot become subject matter for revisionary proceedings u/s 263 of the Act. The cases relied upon in the case of Nirmal Gupta vs PCIT and WSP Consultants India (P.) Ltd. vs PCIT (supra) fortifies the view taken by us. Accordingly, the impugned order u/s 263 of the Act is quashed. The appeal of the assessee is hereby allowed. ITA No. 4874/DEL/2025(AY 2017-18) 29. In this appeal, the impugned order contested is the order giving effect to the direction given by the PCIT u/s 263 of the Act wherein he has set aside the order u/s 143(3) of the Act dated 27.12.2019. We have discussed and decided the issue herein above while dealing with ITA No. 4873/DEL/2025 that the order of the PCIT u/s 263 has become a nullity as there was no valid assessment order in the eyes of law. Since the Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 12 of 13 proceedings under section 263 has been quashed, the order u/s 143(3) r.w. 263 giving effect to the said order u/s 263, cannot survive. Accordingly, the said order is quashed and appeal of the assessee is allowed. 30. In the result, the appeal of the assessee is allowed. 31. In the result, appeal of assessee in ITA No. 4873, 4874 and 4875/DEL/2025 are allowed. Order pronounced in open court on 04.02.2026. Sd/- Sd/- [ANUBHAV SHARMA] [NAVEEN CHANDRA] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 4th February, 2026. VL/ Copy forwarded to: 1. Assessee 2. Respondent 3. CIT 4. CIT(A) Asst. Registrar, 5. DR ITAT, New Delhi Sl No. PARTICULARS DATES 1. Date of dictation of Tribunal Order 2. Date on which the typed draft order is placed before the Dictating Member 3. Date on which the typed draft order is placed before the other Member [in case of DB] 4. Date on which the approved draft order comes to the Sr. P.S./P.S. Printed from counselvise.com ITA Nos. 4873, 4874 and 4875/DEL/2025 Bullionline LLP Vs. ACIT [A.Y 2017-18] Page 13 of 13 5. Date on which the fair Order is placed before the Dictating Member for sign 6. Date on which the fair order is placed before the other Member for sign [in case of DB] 7. Date on which the Order comes back to the Sr. P.S./P.S for uploading on ITAT website 8. Date of uploading, inf not, reason for not uploading 9. Date on which the file goes to the Bench Clerk 10. Date on which the file goes for Xerox 11. Date on which the file goes for endorsement 12. The date on which the file goes to the Superintendent for checking 13. Date on which the file goes to the Assistant Registrar for signature on the order 14. Date on which the file goes to the dispatch section for dispatch the Tribunal order 15. Date of Dispatch of the Order 16. Date on which the file goes to the Record Room after dispatch the order Printed from counselvise.com "