Nand Kishore Gupta, Noida V. ITO Ward 2(3), Noida

ITA 2005/DEL/2019

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 4423 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-04-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Delhi
• Assessment Year: 2012-2013
• Appeal Filed On: 06-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: NEELAM KUMAR JAIN
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Fair market value; Reason to believe; Set aside
• Section: 147; 148; 80C; 50C; 234B; 133(6); 201

Judgement Text

ITA. No. 2005/Del/2019 Page 1 of 8 IN THE INCOME TAX APPELLATE TRIBUNAL [ DELHI BENCH “SMC”: NEW DELHI ] BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AS S.M.C. ITA. No. 2005/Del/2019 (Assessment Year: 2012-13) Shri Nand Kishore Gupta, C – 87A, Sector : 26, Noida – 201 301. PAN: AAIPG8378F Vs. Income Tax Officer, Ward :2 (3), Noida. (Appellant) (Respondent) Assessee by : Shri Neelam Kumar Jain, C. A.; Department by : Shri Om Prakash, Sr.D. R; Date of Hearing : 19/04/2022 Date of pronouncement : 19/04/2022 O R D E R PER AMIT SHUKLA, J. M. : The aforesaid appeal has been filed by the assessee against the impugned order dated 29.10.2018, passed by the ld. Commissioner of Income Tax (Appeals)–1, Noida [hereinafter referred to as CIT (Appeals)] for the quantum of assessment under Section 147/143(3) of the Income Tax Act, 1961 (the Act) for the assessment year2012–13. ITA. No. 2005/Del/2019 Page 2 of 8 2. The assessee has raised the following grounds of appeal:- “1. That the Learned Assessing Officer, Ward-2(3), Noida erred in issuing Notice Under Section 148 of the Act as the Appellant has been regularly assessed with Assessing Officer 3(1), New Delhi for the last several years. The proceedings u/s 147 of the Act and Assessment Order passed by the Assessing Officer not having jurisdiction over the Assessee is totally illegal and liable to be quashed. 2. Without Prejudice to the above Ground, the Learned Assessing Officer, on the facts and circumstances of the case, erred in initiating the proceedings u/s 147 of the Act without recording reasons to believe as per law. The approval u/s 151 of the Act is also mechanical and therefore initiation of proceedings u/s 147 of the Act is totally illegal and without jurisdiction. 3. Without Prejudice to above Grounds of Appeal:- 3.1 On the facts and circumstances of the case, the Learned Assessing Officer erred in Assessing the Income of the Appellant at Rs.27.00,247/- against returned income of Rs. 6,28,670/- and Long Term Capital Loss being carried forward on Sale of Long Term Capital Asset, Agricultural Land. 3.2 That Learned CIT(A) erred in confirming the Order of the Assessing Officer of invoking the provisions of Section 50C of the Act mechanically, inspite of the fact the Appellant objected the substitution of Circle Rate of Land sold against the actual consideration received as per registered Sale Deed. The Appellant submitted before the Assessing Officer that the location of the land is having adverse factors and therefore, the fair market value is less than the Circle Rate. 3.3 That the Learned CIT(A) erred in confirming the Order of the Assessing Officer in adopting the Circle Rate at Rs.72,26,000/- against fair market value of Rs. 40,20,500/- as Sale consideration without following the provision of section 50C of the Act. The Learned Assessing Officer erred in not referring the Valuation of ITA. No. 2005/Del/2019 Page 3 of 8 Land to Valuation Officer as per section 50(2) of the Act. 3.4 Otherwise also, the lower Authorities erred in assessing Long Term Capital Gain of Rs. 19,61,197/- as Short Term Capital Gain and demanding Income Tax at ordinary slab against 20% Rate prescribed u/s 112 of the Act. 3.5 That the lower Authorities erred in not giving claim of deduction u/s 80C amounting to Rs. 95,383/- and under section SOD of Rs. 15,000/-. The Appellant duly submitted the evidence of depositing premium before CIT(A) with submissions dated 08.10.2018. 3.6 That the Learned Assessing Officer erred in charging interest u/s 234A, 234B and 234C of the Act. Otherwise also, interest u/s 234A, 234B & 234C are not computed as per law. 3.7 That entire proceedings conducted by the lower Authorities were not in accordance with law and hence the Assessment Order and Appellate Order are liable to be set aside. “ 3. The facts in brief qua the legal issue raised vide ground No. 1 is that, assessee is an Individual, who is a Director in M/s. Chemitech Engineers Pvt. Ltd. and was regularly assessed to tax and filing was his Income tax returns before Income Tax Officer, Ward 54 (4), New Delhi. For the year under consideration, i.e., assessment year 2012-13, the assessee has filed his return of income with Assessing Officer, Circle 3(1) New Delhi on 23.03.2013 from the address of D-2, 2 nd Floor, Lajpat Nagar, New Delhi. From assessment year 2015-16, the assessee started filing his return of income as per the assigned jurisdiction with Ward 54(4), Delhi. Return of income for the assessment year 2015-16 was up-loaded on 29.09.2015 on the Income Tax Departmental portal with designation of Assessing Officer, Ward / Circle Ward 54(4) Delhi ITA. No. 2005/Del/2019 Page 4 of 8 and similarly for assessment years 2016-17, 2017-18 and 2018-19 the jurisdiction of the Assessing Officer has been mentioned as Ward 54(4) Delhi only. 4. As per the assessment order, there was an AIR information received from the office of the Commissioner of Income Tax, Noida regarding sale of immovable property as on 8.10.2011 for Rs.40,20,500/-, whereas the market value of the property was Rs.72,26,000/-. Based on this information the Income Tax Officer, Ward 2, Noida, has recorded the reasons which are as under:- “ REASONS UNDER SECTION 147 OF THE Act. 1961 Name & address of assessee : Nand Kishor Gupta, C-87A, Sector-26, Noida. 1. PAN : --- 2. Assessment Year : 12-13 3. Date : 20-03-2015. As per AIR information received from the office of the Commissioner of Income Tax, Noida regarding sale of immovable property as on 08-10-2011 for Rs 4020500/- and Market value of property was Rs.7226000/- Notice u/s 133(6) of the I.T. Act 1961 dated 09-01-15 was issued and served upon the assessee. But assessee could not filed reply. It has been found from the information that assessee has sold the property as on 08-10.2011 for Rs.4020500/- whereas the sale consideration as per Sec. 50 C of the property was at Rs.7226000/-. The difference is Rs.3205500/- is taxable u/s 50 C of I. T. Act. The Assessee has not filed his return for A.Y. Considering the above facts, I have reason to believe that assessee has escaped the income to Rs. 3205500/- which is chargeable to tax A, Y. 2012-13 within the meaning of section 147 of the I.T. Act 1961. ITA. No. 2005/Del/2019 Page 5 of 8 Sd/- (Ajay Kumar Gupta) Income Tax Officer Ward-2{3), Noida” 5. Accordingly, notice under Section 148 of the Act was issued by the Income Tax Officer Ward-2{3), Noida on 20.03.2015. In response the assessee filed earlier return in response to notice under Section 148 of the Act. During the course of assessment proceedings the assessee had categorically objected the jurisdiction of the Assessing Officer, Noida treating that now the assessee is being regularly assessed by the Assessing Officer, Ward 54(4), New Delhi, for the last several years and the present Assessing Officer has no jurisdiction. The assessee has also submitted copy of computation of income filed alongwith the original return of income. However, the Assessing Officer did not consider such objections as nothing is borne out from the assessment order. 6. Before the ld. CIT (Appeals) the assessee has raised this specifically additional ground according and which has been placed in the paper book page 31. However, the ld. CIT (Appeals) has not decided this issue. 7. Before me the ld. Counsel drew my attention to copies of Income tax returns filed from assessment year 2008-09 to assessment year 2018-19 and submitted that, all throughout the jurisdiction of Assessing Officer was at New Delhi and at the time of issuance of notice under Section 148 of the Act the jurisdiction of ITA. No. 2005/Del/2019 Page 6 of 8 the Assessing Officer was Ward 54(4) Delhi. Thus, the Income Tax Officer, Ward 2(3), Noida never had jurisdiction either at the time of the issue under Section 148 nor at the time of passing of the assessment order. 8. On the other hand, the ld. DR submitted that some more time should be given to find out whether any transfer order under Section 127 has been passed by the ld. CIT (Appeals) / Pr. CIT transferring the jurisdiction from Delhi to Income Tax Officer Ward 2, Noida. However, I find that on earlier occasion, similar direction was given. Till date, however, no compliance was made. 9. After considering the aforesaid fact and on perusal of the record, I find that all throughout the assessee has been filing his return of income with the Assessing Officer having jurisdiction at New Delhi. From Assessment Year 2015-16 till date, assessee has been electronically filing the return of income and the jurisdiction of the Assessing Officer has been assigned with Ward 54(4) Delhi. Thus, at the time of issuance of notice under Section 147 of the Act Assessing Officer, Ward 54(4) Delhi has the jurisdiction. At no point of time, the jurisdiction was ever transferred to Income Tax Officer, Ward 2(3), Noida. In so far as the contention of the ld. DR that further time should be given to ascertain, whether any order under Section 127 has been passed transferring jurisdiction from Delhi to Noida, I find that already sufficient time was given and moreover, after the notice u/s 148 has been issued in March, 2015 and till this date, the return of income has been accepted in the jurisdiction of Assessing Officer, Ward 54(4) Delhi which means that the ITA. No. 2005/Del/2019 Page 7 of 8 assessee’s jurisdiction was never transferred from Assessing Officer, Ward 54(4) to Income Tax Officer, Ward 2(3) Noida, specifically when Income Tax returns are up-loaded on the portal of the Income Tax Department. Thus, not only the issuance of notice under Section 148 of the Act was invalid as Income Tax Officer, Ward 2(3) Noida did not have jurisdiction to issue notice under Section 148; nor he could have passed the assessment order. If the Assessing Officer had received any information, then he should have forwarded the said information to the jurisdictional Assessing Officer to initiate action under Section 148 of the Act and to proceed with the assessment / reassessment. Simply receiving information about escapement of income to any Assessing Officer does not mean that Assessing Officer can acquire jurisdiction automatically on a assessee. Jurisdiction is acquired in accordance with the statute and as per territorial jurisdiction or jurisdiction which have been assigned by the order of the CBDT. Thus, the entire proceedings initiated under Section 148 of the Act and passing of the assessment order by Income Tax Officer, Ward 2(3) Noida is void ab initio and the same is quashed. 10. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on : 19/04/2022. Sd/- ( AMIT SHUKLA ) JUDICIAL MEMBER Dated : 19/04/2022. ITA. No. 2005/Del/2019 Page 8 of 8 *MEHTA* Copy forwarded to : 1. Appellant; 2. Respondent 3. CIT 4. CIT (Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, New Delhi Date of dictation 19.04.2022 Date on which the typed draft is placed before the dictating member 19.04.2022 Date on which the typed draft is placed before the other member 19.04.2022 Date on which the approved draft comes to the Sr. PS/ PS 19.04.2022 Date on which the fair order is placed before the dictating member for pronouncement 19.04.2022 Date on which the fair order comes back to the Sr. PS/ PS 19.04.2022 Date on which the final order is uploaded on the website of ITAT 19.04.2022 date on which the file goes to the Bench Clerk 19.04.2022 Date on which the file goes to the Head Clerk The date on which the file goes to the Assistant Registrar for signature on the order Date of dispatch of the order