INCOME TAX OFFICER, WARD-29(1) DELHI, DELHI V. SNEH SHARMA , DELHI

ITA 2137/DEL/2025

AI Insights

The case involves appeals by the Income Tax Officer (ITO), Ward 29(1), New Delhi against Sneh Sharma concerning several assessment years. The appeals were primarily based on the orders of the CIT(A), NFAC, Delhi, which had quashed the assessments made by the ITO. The Tribunal examined whether the appeals were maintainable based on the tax effect and whether the procedural requirements under section 144C of the Income-tax Act were followed. The Tribunal found that for some years, the appeals were not maintainable due to the low tax effect, and for others, the non-issuance of a draft assessment order was a significant procedural error.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 793326 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2013-2014
• Appeal Filed On: 31-03-2025
• Other Referred Cases: Abhishek Jain vs. ITO, Ward 55(1), New Delhi (2018) 94 taxmann.com 355 (Delhi), CIT vs. Shri Shyam Sunder Infrastructure (P) Ltd. in ITA 236/2014, order dated 04.02.2015 of the Hon'ble Delhi High Court
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH GUPTA
• Assessee Lawyers: ANIL BAJAJ
• Keywords: Transfer pricing; Tax effect; TDS
• Section: 147; 144; 2

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : G : NEW DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER AND SHRI MANISH AGARWAL, ACCOUNTANT MEMBER ITA Nos.2136 to 2141/Del/2025 Assessment Years: 2012-13 to 2017-18 ITO, Ward 29(1), New Delhi. Vs. Sneh Sharma, A-3/I, Second Floor, Paschim Vihar, Delhi – 110 063. PAN: ANZPS2241M (Appellant) (Respondent) Assessee by : Shri Anil Bajaj, CA Revenue by : Shri Manish Gupta, Sr. DR Date of Hearing : 16.09.2025 Date of Pronouncement : 24.09.2025 ORDER PER ANUBHAV SHARMA, JM: These are appeals preferred by the Assessees against the orders dated 28.01.2025 (in respect of ITA No.2136/Del/2025) and 11.01.2025 (in respect of other appeals) of the Ld. Commissioner of Income-tax (Appeals), NFAC, Delhi (hereinafter referred to as the First Appellate Authority or ‘the ld. FAA’ for short) in appeals filed before him against the orders dated 04.12.2019 (in respect of ITA No.2136/Del/2025) and 31.03.2022 (in respect of other appeals) of the ITO, Ward 29(1), Delhi (hereinafter referred to as the Ld. AO, for short) passed Printed from counselvise.com ITA Nos.2136 to 2141/Del/2025 2 u/s 147 r.w.s. 144 of the Income-tax Act, 1961 (hereafter referred to as ‘the Act’). Further details of the orders of the lower authorities are as under:- ITA No. & Assessment Year Appeal No. of the CIT(A), NFAC 2136/Del/2025 NFAC/2011-12/10154326 2137/Del/2025 NFAC/2012-13/10135736 2138/Del/2025 NFAC/2013-14/10135736 2139/Del/2025 NFAC/2014-15/10135737 2140/Del/2025 NFAC/2015-16/10135739 2141/Del/2025 NFAC/2016-17/10135741 2. At the outset, the ld. AR has pointed out in regard to the appeals that the same are barred by limitation and we find that the Registry has also marked the defect that the appeals are barred by limitation. As there was no resistance from ld. AR to hear appeals on merits delay was condoned and appeals were heard on merits. 3. At the same time, in regard to the appeals for AYs 2012-13, 2013-14, 2014-15 and 2016-17, it was also pointed out that these appeals are not maintainable as the tax effect is less than Rs.60 lakhs. A report is filed by the ld. DR that they fall in the category of exceptions 3.1(a) of the CBDT Circular No.05/2024 dated 15.03.2024. However, we are of considered view that no question of constitutionality or legality of any provision of law is involved to be decided here in the Tribunal. There is no substance in invoking the exception by the AO. Thus, these appeals in ITAs No.2136, 2137, 2138 & 2140/Del/2025 for Printed from counselvise.com ITA Nos.2136 to 2141/Del/2025 3 Assessment Years AYs 2012-13, 2013-14, 2014-15 and 2016-17 are dismissed being of low tax effect appeals filed by the Revenue. 4. As with regard to the appeals for 2015-16 and 2017-18, the ld. AR has pointed out that the assessee is a non-resident individual residing in the United Kingdom and this fact is not disputed by the Revenue. The assessee’s return for AY 2020-21 and 2021-22 were filed declaring her status as non-resident. Later, the return was processed u/s 143(1) of the Act vide intimation dated 16.03.2022. The AO was fully conscious of this aspect and, accordingly in the show cause notice as well as the impugned assessment order specifically notes that TDS has been deducted u/s 195 of the Act which is a provision applicable only to non- resident. Thus, being an ‘eligible assessee’ for the purpose of section 144C(15) of the Act, the AO was supposed to first issue a draft assessment order u/s 144C(1) of the Act, but, instead the AO has proceeded to pass a final assessment order directly and this jurisdictional infirmity has been adjudicated by the ld.CIT(A) by the impugned order by quashing the assessment proceedings and holding that there was violation of mandatory provisions and procedure as enshrined u/s 144C of the Act. 5. The ld. DR, on the contrary, has submitted that non-issuance of draft assessment order does not vitiate the final assessment and is not a jurisdictional defect and reliance was placed on the decisions in the cases Abhishek Jain vs. ITO, Ward 55(1), New Delhi (2018) 94 taxmann.com 355 (Delhi) and CIT vs. Printed from counselvise.com ITA Nos.2136 to 2141/Del/2025 4 Shri Shyam Sunder Infrastructure (P) Ltd. in ITA 236/2014, order dated 04.02.2015 of the Hon’ble Delhi High Court. 6. On going through these decisions, we find that these two cases involved dispute over territorial jurisdiction between the two AOs wherein by virtue of section 124(3) of the Act, the Hon’ble High Court has held that such objections should be raised at the threshold. However, the assessment in the case of eligible assessee by virtue of provisions of section 144C of the Act is an assessment wherein both the subject i.e assessee and the subject matter of the assessment are vested exclusively with the International Taxation Circle. Section 144C is a complete code in itself which has set out a separate assessment mechanism for eligible assessee’s whose income are subject to transfer pricing variation or who are non-residents or foreign companies. This code entitles these eligible assessee’s to first receive a draft assessment order from the AO, and gives them the option to decide the forum to prefer objection against the draft assessment order or the choice to accept the draft assessment order and retain the liberty to prefer regular appeal route before the Ld. CIT(A). Therefore, the assessee’s challenge was not circumscribed by the restriction under Section 124(3) of the Act. The ld.CIT(A) has accordingly taken the same into consideration and the findings, thus, require no interference. Printed from counselvise.com ITA Nos.2136 to 2141/Del/2025 5 7. In the light of the aforesaid, ITAs No.2139 & 2141/Del/2025 for AYs 2015-16 and 2017-18 also deserves to be dismissed. Order pronounced in the open court on 24.09.2025. Sd/- Sd/- (MANISH AGARWAL) (ANUBHAV SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 24th September, 2025. dk Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asstt. Registrar, ITAT, New Delhi Printed from counselvise.com "