GAYA PRASAD BAJAJ V. INCOME TAX OFFICER AND ANOTHER

IAPLD/15/2022

AI Insights

The case involves Gaya Prasad Bajaj, the appellant, contesting an assessment order passed by the Income Tax Officer, which he claimed was beyond the jurisdiction of the assessing authority. Initially, this issue was not raised during the assessment or the first appeal but was brought up at the tribunal level under Rule 11 of the Income Tax Appellate Tribunal Rules, 1963. The tribunal did not decide on the merits of the jurisdictional issue but remanded the matter back to the first appellate authority for a fresh decision on this legal issue, along with all other grounds raised by the appellant. The High Court's decision clarified that the first appellate authority must re-examine all issues, including jurisdiction, without being influenced by the previous order.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 762724 (HC-ALLAHABAD)
• Appeal Type: Others
• Pronouncement Date: 22-08-2022
• Assessment Year: misc
• Laws Referred To: Income Tax Appellate Tribunal Rules' 1963
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: GAURAV MAHAJAN
• Assessee Lawyers: ABHINAV MEHROTRA; SATYA VRATA MEHROTRA
• Keywords: Assessment Order; First Appellate Authority; Jurisdiction; Legal Issue; Remand
• Section: 143(3)

Judgement Text

"Court No. - 39 Case :- INCOME TAX APPEAL DEFECTIVE No. - 15 of 2022 Appellant :- Gaya Prasad Bajaj Respondent :- Income Tax Officer And Another Counsel for Appellant :- Abhinav Mehrotra,Satya Vrata Mehrotra Counsel for Respondent :- Gaurav Mahajan Hon'ble Mrs. Sunita Agarwal,J. Hon'ble Mrs. Jyotsna Sharma,J. Learned counsel for the appellant states that the defect in filing the appeal has been removed. Having perused the report of the Stamp Reporter, we direct the office to allot regular number to the appeal. Heard Sri Abhinav Mehrotra learned counsel for the appellant and Sri Guarav Mahajan learned Advocate for the respondent department. Having perused the order impugned dated 04.08.2021 passed by the tribunal, we find that on the issue raised by the assessee, about the lack of jurisdiction of the assessing authority to pass the assessment order, for the first time before the tribunal by moving an application under Rule 11 of the Income Tax Appellate Tribunal Rules' 1963, the tribunal had relegated the matter to the first appellate authority with the findings as follows:- \"7. I have considered the rival submissions as well as relevant record. Both the parties have argued at length on the legal issue raised by the assessee challenging jurisdiction of the Assessing Officer to complete the assessment under section 143(3). It is pertinent to note that the issue regarding the jurisdiction of the Assessing Officer was undisputedly not raised by the assessee either before the Assessing Officer before the completion of the assessment or even before the CIT(A). It is also a matter of record that the assessee has not raised this issue in the Form No. 36 or even as an additional ground in writing. However, since the issue is purely legal in nature and goes to the root of the matter, therefore, the legal issue raised by the assessee first time before the Tribunal cannot be rejected on technical ground. Since the assessee has raised this issue first time before the Tribunal and that too in course of argument without prior leave of the Bench in writing therefore, having regard to the facts and circumstances and in the interest of justice, the assessee is allowed to raise this issue before the CIT(A) so that a view of the first appellate authority would be available based on the relevant facts on record. Accordingly, without expressing any view on the merits of the issue, the same is set aside to the record of the CIT(A) for adjudication after considering various legal points raised by both the parties and after giving an opportunity of hearing to the assessee. Since the legal issue raised by the assessee goes to the root of the matter therefore, the other grounds raised by the assessee on the merits of the addition are kept open which were otherwise not argued by the ld. AR.\" The contention of the learned counsel for the appellant is that since the tribunal has not returned any definite finding on the order passed by the first appellate authority dated 19.09.2018, the appellant has an apprehension that the said order passed by the first appellant authority would come in his way even on a fresh decision being made by the first appellate authority after remand. The contention is that the occasion for filing the present appeal arose on account of this error committed by the tribunal where while relegating the matter to the first appellate authority to deal with the issue on jurisdiction keeping all issues open for fresh consideration, no definite opinion was expressed by the tribunal about the validity of the order dated 19.09.2008. Having considered the submissions made by the learned counsel for the appellant and perused the finding as extracted above, this much is clear that the tribunal on the jurisdictional issue raised by the assessee, did not enter into the merits of the order dated 19.09.2008 and relegated the matter to the first appellate authority for decision on appreciation of the question of law of jurisdiction on the facts of the case itself. It was further observed by the tribunal that since the issue of jurisdiction, the legal issue raised by the assessee, goes to the merits of the matter, all other grounds raised by the assessee on merits are kept open, though not argued. Having considered the observations made by the tribunal in the order impugned, we only clarify that once the matter is relegated to the first appellate authority on the jurisdictional issue and the tribunal has not expressed any opinion on the merits of the order dated 19.09.2018 passed by the first appellate authority, all the issues raised by the assessee before the first appellate authority at the first instance, including the issue of jurisdiction raised before the tribunal by way of additional grounds are required to be considered by the first appellate authority afresh and an order strictly in accordance with law shall be passed on merits dealing with all issues raised before the first appellate authority after remand. With these observations and directions, the present appeal is disposed of at the admission stage itself. Order Date :- 22.8.2022 Himanshu Digitally signed by HIMANSHU YADAV Date: 2022.08.24 10:48:18 IST Reason: Location: High Court of Judicature at Allahabad "