INCOME TAX OFFICER, KALYAN V. IRFAN AHMAD, THANE

WTA 2/MUM/2025

AI Insights

The case involves an appeal by the Income Tax Officer, Ward-1(1), Kalyan against Irfan Ahmad concerning a wealth tax assessment for the assessment year 2010-11. The primary legal issue was the jurisdiction of the assessing officer in Azamgarh, UP, to issue a notice under section 17(1) of the Wealth Tax Act, 1957, which was contested by the assessee. The revenue argued that the notice was valid despite the monetary limit for filing appeals being less than the usual threshold, citing exceptions in the CBDT Circular 5 of 2024. However, it was revealed during the proceedings that the Wealth Tax Act had been abolished by the Finance Act, 2016, prior to the issuance of the notice, rendering it and any subsequent actions based on it invalid.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 783678 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 8 day(s)
• Appeal Type: Wealth Tax Appeal
• Pronouncement Date: 03-11-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 25-07-2025
• Other Referred Cases: Shamim Ahmed vs ACIT
• Laws Referred To: Wealth Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R.A. DHYANI
• Assessee Lawyers: V. K. JINDAL; VIRTUALLY APPEAR
• Keywords: Set aside; Tax effect

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, MUMBAI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER& SMT RENU JAUHRI, ACCOUNTANT MEMBER WTA No. 2/MUM/2025 (AY: 2010-11) (Physical hearing) ITO, Ward-1(1), Kalyan Mohan Plaza, Wayle Nagar, Khadakpada, Kalyan West, Thane, Maharashtra – 421301. Vs Irfan Ahmad 673, Naigaon Part -1, Rizwan Comound, Bhiwandi, Thane, Maharashtra-421302. [PAN: ACKPS5844E] Appellant / Revenue Respondent / Assessee Assessee by Shri V.K. Jindal, CA (virtually appear) Revenue by Shri R.A. Dhyani, CIT-DR Date of Institution 25.07.2025 Date of hearing 03.11.2025 Date of pronouncement 03.11.2025 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by revenue is directed against the order of CWT(A) passed under section 23 of Wealth Tax Act (Act) for A.Y. 2010-11. The revenue has challenged the validity of order passed by learned CWT(A)/ NFAC in holding that assessing officer at Azamgarh, UP have no jurisdiction to issue notice under section 17(1) dated 28.12.2017 of the Act. 2. Rival submissions of both the parties have been heard and record perused. The learned Commissioner of Income Tax – Departmental Representative (CIT-DR) for the revenue submits that though the tax effect in the present appeal is less than the monetary limit for filing appeal before Tribunal, Printed from counselvise.com Irfan Ahmad WTA No. 2/Mum/2025 (AY 2010-11) 2 however, the grounds of appeal raised by revenue are falls within the exceptions clause 3.1.(k) of CBDT Circular 5 of 2024. As per said circular, matter related to wealth tax, fringe benefit tax, acquisition levy falls in exceptions clause. The CIT-DR for revenue submits that assessing officer has validly issued notice under section 17(1) of Wealth Tax Act dated 30.03.2017 which was duly served upon the assessee. No compliance was made by the assessee. The assessment under Wealth Tax Act was completed on the basis of material available on record in the form of information available that five persons including of assessee have purchased property being land bearing Plot No. 2, UPSIDC, Industrial Estate, Amausi, Lucknow admeasuring 21,135 sq. meters. Such information was disclosed in IDS 2016 but such asset was not shown in their returns. The said plot of land does not fall under any of the exception provided in section 2(ea) of Wealth Tax Act. Since the assessee was one of the co-owner being 1/5th share accordingly wealth of assessee was assessed. The ld. CIT(A) allowed relief to the assessee on the basis of decision of Tribunal in one of the co- owners case in Shamim Ahmed vs ACIT in WTA No. 01 & 02/VNS/2020 dated 26.08.2021. The assessee has not responded to the assessing officer despite the service of notice. During the hearing, the ld. CIT-DR for the revenue was confronted with the fact that Wealth Tax Act, 1957 was abolished by Finance Act, 2016. The Printed from counselvise.com Irfan Ahmad WTA No. 2/Mum/2025 (AY 2010-11) 3 notice under section 17(1) was issued after abolition of wealth tax. The ld. CIT-DR fairly accepted such fact. However, he fully supported the order of AO. 3. On the other hand, ld. Authorised Representative (AR) of the assessee supported the order of ld. CIT(A). The ld. AR of the assessee submits that assessing officer at Azamgarh has no jurisdiction. The case of his co-owner was also reopened on similar information, however on further appeal before ITAT, the assessment order passed under section 17(1) of Wealth Tax Act was set aside / quashed by Tribunal by holding that assessing officer Azamgarh has no jurisdiction. The assessee is having PAN in Mumbai. 4. We have considered the rival submissions of both the parties and have gone through the orders of lower authorities carefully. We find that case of assessee was reopened by issuing notice under section 17(1) dated 30.03.2017. Admittedly, when notice under section 17(1) was issued, the Wealth Tax Act, 1957 was already abolished. Thus, the issuance of notice under section 17(1) is illegal and invalid and subsequent action initiated therein is being void ab initio. Considering the fact that we have declared notice as invalid, therefore, adjudication on other objection / grounds of appeal or contention of the parties have become academic. In the result, the ground of appeal raised by the revenue is dismissed. Printed from counselvise.com Irfan Ahmad WTA No. 2/Mum/2025 (AY 2010-11) 4 5. In the result, the appeal of the revenue is dismissed. Order was pronounced in the open Court on 03/11/2025. Sd/- Sd/- RENU JAUHRI ACCOUNTANT MEMBER PAWAN SINGH JUDICIAL MEMBER MUMBAI, Dated: 03/11/2025 Biswajit Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and (5) Guard file. By Order Assistant Registrar ITAT, Mumbai Printed from counselvise.com "