M/s. KIE Infrastructures & Projects Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 23/DEL/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90943 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 3 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-04-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 24-02-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 03-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GAURAV DUDEJA
• Assessee Lawyers: VED JAIN RANO JAIN
• Keywords: Opportunity of being heard; Question of law; Competent authority
• Section: 147; 148; 6; 12; 154; 139; 143(3); 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, NEW DELHI BEFORE SHRI P. K. BANSAL, HONBLE ACCOUNTANT MEMBER AND SMT. DIVA SINGH , HONBLE JUDICIAL MEMBER ITA NO. 23/DEL/2012 : (A.Y 2008 - 09) M/S. KIE INFRASTRUCTURES & PROJECTS PVT. LTD., C - 208, ESTEEM COMPLEX, SAVITRI NAGAR, NR. SHEIKH SARAI, PHASE - I, NEW DELHI 110 017. PAN : AACCK7961R ( APPELLANT) VS. INCOME TAX OFFICER, WARD - 5(3), NEW DELHI (RESPONDENT) ASSESSEE BY : VED JAIN &RANO JAIN, CA REVENUE BY : GAURAVDUDEJA, SR. DR DATE OF HEARING : 25/02/2015 DATE OF ORDER : 17 / 04 /2015 O R D E R PER P.K. BANSAL : 1. THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - VIII, NEW DELHI DT. 20.10.2011 FOR A.Y 2008 - 09 BY TAKING THE FOLLOWING EFFECTIVE GROUNDS OF APPEAL : 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (A) ERRED IN DISMISSING THE APPEAL OF THE APPLICANT BY HOLDING THAT NOTICE U/S 143(2) OF THE ACT WAS DULY SERVED ON THE APPELLANT COMPANY WHILE NO SUCH NOTICE WAS SERVED ON THE APPELLANT / RECEIVED BY THE APPELLANT COMPANY AND AS SUCH NO ASSESSMENT U/S 143 OF THE ACT COULD BE FRAMED AND THE ASSESSMENT FRAMED IS BAD IN THE EYES OF LAW, ILLEGAL AND UNJUSTIFIED, AND DESERVES TO BE ANNULLED. 2. THAT NO NOTICE U/S 143 (2) OF THE ACT WAS EVER SERVED ON AN Y OF THE DIRECTORS OF THE COMPANY INCLUDING SHRI SHRIMOHAN KHANDELWAL, ON WHOM THE NOTICE U/S 143 (2) OF THE ACT IS ALLEGED TO HAVE BEEN SERVED. 3. THAT THE APPELLANT IS A REGULAR ASSESSEE AT WARD - 5(3) NEW DELHI AND HAS NEVER FILED ITS RETURN OF INCOME AT AGRA AND THE SAME WAS FILED WITH THE ASSESSING OFFICER WARD 5 (3), NEW DELHI AND ITS REGISTERED OFFICE IS ALSO SITUATED IN DELHI SINCE INCEPTION OF THE COMPANY. 2 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) THE COMPANY HAD ALSO RECEIVED 143(1) INTIMATION FOR THE ASSESSMENT YEAR 2006 -- 2007 IN MARCH 2008 FROM, ITO WARD 5 (3), NEW DELHI. AND AS SUCH JURISDICTION OVER THE APPELLANT VESTED IN THE ASSESSING OFFICER, DELHI AND ITO AGRA HAS HAD NO JURISDICTION OVER THE APPELLANT. 4. THAT BEFORE COMPLETION OF THE ASSESSMENT U/S 143 (3) OF THE ACT THE APPELL ANT RAISED OBJECTION THAT NO PROCEEDINGS U/S 143 (2) OF THE ACT CAN BE INITIATED ON THE APPELLANT IN THE ABSENCE OF SERVICE OF NOTICE U/S 143 (2) OF THE ACT AFTER THE STATUTORY PERIOD HAD EXPIRED AND THUS PROVISO TO SEC 292 BB OF THE ACT WILL APPLY. THE CO MPLETION OF ASSESSMENT U/S 143 (2) OF THE ACT IS THUS VOID ABINITIO AND LIABLE TO BE ANNULLED. 5. THAT THE LEARNED ASSESSING OFFICER ERRED IN COMPUTING THE INCOME OF THE APPELLANT AT RS. 28 , 13,834/ - AS AGAINST THE RETURNED INCOME OF RS.4,53 , 512/ - , MAKING AN ADDITION OF RS 23,60,322/ - FOLLOWING REVENUE RECEIPT BASIS WHILE THE COMPANY FOLLOWED 'REVENUE RECOGNITION' ACCOUNTING POLICY CONSISTENTLY AS PER WHICH PROFIT ON ITS ACTIVITIES COULD BE RECOGNISED ON COMPLETION OR ON SUBSTANTIAL COMPLETION OF PROJECT. T HE DECISION OF HON'BLE HIGH COURT OF DELHI IN THE CASE OF CIT V/S TRIVENIENGG& INDUSTRIES LTD (2011) 196 TAXMAN 94 IS FULLY APPLICABLE IN THE CASE OF THE APPELLANT. THE ADDITION IS ILLEGAL, UNJUSTIFIED AND CONTRARY TO ACCOUNTING POLICIES AND LIABLE TO BE DELETED. 6. THAT THE LEARNED AO FAILED TO APPRECIATE THE THAT THE INCOME FROM BUSINESS HAS BEEN DECLARED BY THE ASSESSEE IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2009 - 2010 ON THE BASIS OF REVENUE RECOGNITION ACCOUNTING POLICY AND TAXING THE SAME IN THE ASSESSMENT YEAR UNDER APPEAL TANTAMOUNT TO DOUBLE TAXATION OF THE SAME INCOME WHICH IS NOT PERMISSIBLE UNDER T HE ACT. 7. THAT THE LEARNED CIT APPEALS / ASSESSING OFFICER ERRED IN TAKING THE INTEREST INCOME FROM BANK AT RS. 14,45,252/ - WITHOUT ALLOWING FOR INTEREST EXPENDITURES AND OTHER GENUINE EXPENDITURES AS CLAIMED BY THE ASSESSEE IN ITS RETURNS OF INCOME. 8. THAT THE ASSESSMENT ORDER IS BASED ON THE ALLEGED EVENTS WHICH WERE BASED ON THE INTERNAL SYSTEMS AND PROCEDURES OF THE DEPARTMENT AND THE SAME WERE NEVER CONFRONTED TO THE APPELLANT DURING THE ASSESSMENT PROCEEDINGS. THE FACT THAT NO NOTICE U/S 143 (2) O F THE ACT HAS BEEN SERVED ON THE APPELLANT WAS BROUGHT TO THE KNOWLEDGE OF THE ASSESSING OFFICER WITH PRAYER THAT ISSUE OF SERVICE OF NOTICE BE FIRST SETTLED / DECIDED BUT THE LEARNED ASSESSING OFFICER CHOOSE TO FRAME THE ASSESSMENT TOTALLY IGNORING THE LA W AND AS SUCH ASSESSMENT FRAMED IS BAD IN THE EYES OF LAW AND IS LIABLE TO BE QUASHED / CANCELLED / ANNULLED. 9. THAT THE HON'BLE CIT (A) ERRED IN THE MATTER OF ISSUANCE OF PAN FROM AGRA OF THE APPELLANT COMPANY AND COMPLETELY IGNORED THE FACT THAT THE AP PLICATION FOR ALLOTMENT OF PAN WAS MADE BY COMPANY HAVING ITS REGISTERED OFFICE AT NEW DELHI AND ALSO SHOWING THE CORRESPONDING ADDRESS AT NEW DELHI AND NOT AT AGRA. 3 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) 2. GROUND NOS. 1 TO 4 RELATE TO THE COMMON ISSUE RELATING TO SERVICE OF NOTICE U/S 143(2 ) OF THE INCOME TAX ACT AS WELL AS JURISDICTION OF THE ASSESSING OFFICER . THE BRIEF FACTS OF THE CASE AS GATHERED FROM THE ASSESSMENT ARE THAT THE ASSESSEE COMPANY IS ENGAGED IN CONSTRUCTION AND OTHER INFRASTRUCTURE AND PROJECT DEVELOPMENT BUSINESS. RETURN FOR THE IMPUGNED ASSESSMENT YEAR WAS FILED ON 30.9.2008 WITH THE ITO, WARD - 4(2), AGRA THROUGH E - FILING. NOTICE U/S 143(2) WAS ISSUED BY THE ITO, WARD - 4(2 ), AGRA ON 13.8.2009 WHICH WAS SENT AS PER THE ADDRESS GIVEN IN THE RETURN OF INCOME I.E. C - 208, A/6, SAVITRA NAGAR, NR. SHEKH SARAI, PHASE - I, NEW DELHI 110 077. SIMULTANEOUSLY, NOTICE U/S 143(2) WAS ALSO SENT AND SERVED UPON ONE OF THE DIRECTORS, SHRI MO HAN KHANDELWAL AT 30 - A, MUNRO ROAD, AGRA CANTT. AGRA ON 23.9.2009. T HE ASSESSEE ON 15.12.2010 FOR THE FIRST TIME THROUGH WRITTEN OBJECTION CHALLENG ED THE SERVICE OF THE NOTICE ISSUED U/S 143(2) BY THE ITO, WARD - 4(2), AGRA NAMELY ON THE GROUND THAT THE ASSES SEE COMPANY IS A REGULAR ASSESSEE AND ASSESSED AT DELHI AND IS FILING ITS RETURN OF INCOME FROM A.Y 2006 - 07 TILL DATE WITH THE ITO, WARD - 5(3), NEW DELHI. THE COMPANY WAS INCORPORATED ON 2.6.2005. ITO, WARD - 5(3), NEW DELHI DID NOT ISSUE ANY NOTICE U/S 143 (2) WITHIN THE PRESCRIBED TIME U/S 143(2) I.E. ONE YEAR FROM THE DATE OF FILING OF THE RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION I.E. 30.9.2009. ALTERNATELY, EVEN IF THE AO AT AGRA HAS THE JURISDICTION, THERE IS NO VALID TRANSFER OF JURI SDICTION FROM AGRA TO DELHI. THE AO DISPOSED OFF THE OBJECTION IN THE FOLLOWING MANNER : - RETURN FOR THE A. Y. 2008 - 09 WAS E - FILED VIDEACK NO, 44775850300908 ON30.09.2008 WITH ITO, 4(2), AGRA. THE CASE WAS SELECTED UNDER SCRUTINY THROUGH CASS AND THE NOTICE U/S 143(2) WAS ISSUED BY THE INCOME TAX OFFICER, 4(2) ON 13.08.2009, WHICH WAS SENT AT THE ADDRESSES GIVEN IN THE RETURN OF INCOME I.E. C - 208A/6, SAVITRI NAGAR, NEAR SHEIKH SARAI, PHASE - I, NEW DELHI - 110077 WHICH WAS FILED BY THE ASSESSEE ITSELF. NOT ICE U/S 4 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) 143(2) WAS ALSO RECEIVED BY ONE OF THE DIRECTORS OF THE COMPANY ON 23.09.2009, WHICH IS EVIDENT FROM RECORD. - THE ASSESSEE HAS NOT FILED ANY OBJECTION REGARDING THE JURISDICTION/SERVICE OF THE NOTICE TILL 06.12.2010. AS PER SECTION 124 OF THE I T ACT IN WHICH JURISDICTION OF THE ASSESSING OFFICER IS DEFINED, THE ASSESSEE CAN CALL IN QUESTION JURISDICTION OF AN ASSESSING OFFICER. HE CAN DO BY MAKING A REPRESENTATION TO THE ASSESSING OFFICER. HOWEVER, THE CHALLENGE TO TH E JURISDICTION SHOULD BE DONE BEFORE THE EXPIRY OF THE TIME GIVEN IN THE NOTICE, WHERE THE ASSESSEE HAS NOT FURNISHED A RETURN OF FRINGE BENEFITS UNDER SECTION L1 5WD(L) OR A RETURN OF INCOME UNDER SECTION 139(1) . WHERE THE RETURN HAS BEEN FURNISHED BY TH E ASSESSEE, SUCH A CHALLENGE CAN BE MADE WITHIN ONE MONTH OF DATE OF SERVICE OF NOTICE UNDER SECTION 11SWE(2), 142(1) OR 143(2), BUT BEFORE THE COMPLETION OF ASSESSMENT. - THE DECISIONS QUOTED BY THE AR OF ASSESSEE COMPANY ARE CLEARLY DISTINGUISHABL E SINCE IN THE INSTANT CASE THE ASSESSEE COMPANY HAS FILED ITS RETURN OF THE INCOME FOR THE A.Y. 2006 - 07(PAPER RETURN AT AGRA), FOR A.YS.2007 - 08 AND 2008 - 09 WERE E - FILED RETURNS. THE PRINT OUT TAKEN FROM THE E - FILE RETURN OF INCOME SHOWS THAT THE ASSESSEE HAS ITSELF MENTIONED THE JURISDICTION OF THE COMPANY ITO 4(2), AGRA. THE PAN ALLOTTED ON THE BASIS OF THE INFORMATION SUBMITTED BY THE ASSESSEE WHICH INCLUDES THE EVIDENCE OF PLACE AND ADDRESS OF THE BUSINESS. THE JURISDICTION OF THE A.O. IS DECIDED ON THE BASIS INFORMATION FILLED BY THE ASSESSEE. THE PAN OF THE ASSESSEE COMPANY WAS MIGRATED ON 23.03.2010 TO ITO WARD - 5(3), NEW DELHI FROM ITO. 4(2). AGRA AS THE REFUND FOR THE A. Y. 2008 - 09 WAS TO BE ISSUED ON THE BASIS PAPER RETURN FILED BY THE ASSESSEE W ITH UNDERSIGNED. IN VIEW OF THE ABOVE, THE NOTICE ISSUED U/S 143(2) BY THE ITO 4(2), AGRA FOR THE A.Y. 2008 - 09, ISSUED AS PER THE PROVISIONS OF IT ACT'. 5 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) SUBSEQUENTLY, ASSESSMENT WAS COMPLETED ON THE BASIS OF THE RE CEIPT SHOWN IN THE TDS CERTIFICATE FILED BY THE ASSESSEE COMPANY ALONGWITH THE RETURN OF INCOME DUE TO WHICH THE ADDITION OF RS. 13,68,582/ - WAS MADE ON ACCOUNT OF NET PROFIT ESTIMATED @ 5% ON GROSS CONTRACTUAL RECEIPT AMOUNTING TO RS.2,73,71,630/ - AND INT EREST INCOME OF RS.14,45,252/ - BEING INTEREST PAID BY THE BANK OF BARODA, HAR DWAR AS PER TDS CERTIFICATE FILED BY THE ASSESSEE COMPANY. THE AO REJECTED THE PLEA OF THE AS SESS EE. THE ASSESSEE WENT IN APPEAL AGAINST THE JURISDICTION AS WELL AS SERVICE OF TH E NOTICE U/S 143(2). CIT(A) TOOK THE VIEW THAT THE NOTICE U/S 143(2) HAS BEEN DULY ISSUED AND SERVED UPON THE ASSESSEE WITHIN THE TIME LIMIT STIPULATED U/S 143(2). IN RESPECT OF THE JURISDICTION, THE CIT(A) NOTED THAT THE ASSESSEE HAS GIVEN ADDRESS IN FO RM 49A FOR ALLOTMENT OF PAN AS INTEGRATED REGISTRY SERVICE LTD., 103, PUNEET VRINDAWAN, SANJAY PLACE, AGRA (U.P) 282005 AND ACCORDINGLY, THE JURISDICTION MENTIONED BY THE ASSESSEE IS KNP/W/80/2. THE RESIDENTIAL ADDRESS OF THE ASSESSEE IS SHOWN AS 72 - 80, I NDUSTRIAL ESTATE, NUNIHAI, AGRA (U.P) 208206. THE ASSESSEE HAS ENCLOSED COPY OF PASSPORT AS A PROOF WITH FORM 49A. ULTIMATELY, CIT(A) TOOK THE VIEW THAT THE JURISDICTION LIES WITH THE INCOME TAX OFFICER, WARD - 4(2), AGRA. THE ITO, AGRA TRANSFERRED THE C ASE TO NEW DELHI WHEN THE REQUEST WAS MADE TO MIGRATE THE PAN NUMBER AS PER THE ADDRESS OF REGISTERED OFFICE GIVEN IN THE RETURN. CIT(A) ULTIMATELY DISMISSED THE PLEA OF THE ASSESSEE BY TAKING THE VIEW THAT THE CORRECT JURISDICTION OVER THE ASSESSEE WAS W ITH ITO, WARD - 4(2), AGRA AT THE TIME WHEN THE CASE WAS SELECTED FOR SCRUTINY AND HE WAS ONLY COMPETENT TO ISSUE NOTICE U/S 143(2) OF THE INCOME TAX ACT WHICH WAS DULY ISSUED BY HIM ON 13.8.2009 WELL WITHIN THE TIME LIMIT PRESCRIBED UNDER THE SAID SECTION. 3. THE LD. AR BEFORE US CONTENDED THAT T HE ASSESSEE IS A COMP ANY INCORPORATED ON 2 ND JUNE,2005 HAVING ITS RE GISTE RED OFFICE SINCE THEN AT C - 208, ESTEEM COMPLEX, SRI NAGAR, NEAR SHEIKH SARAI,NEW DELHI. S INCE ASSESSEE WA S 6 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) HAVING ITS REGISTERED OFFIC E IN DELHI AND ITS JURISDI CTI ON LIES WITH CIT - I I , DELHI, IT FILED ITS RETURN OF INCOME AT DELHI WITH ITO WARD 5(3). THE FIRST RETURN FOR THE ASSESSMENT YEAR 2006 - 07 WAS FILED WITH ITO, WARD 5(3), NEW DELHI (PAPER BOOK PAGE36). THIS WAS PROCESSED BY ITO, WARD 5( 3), NEW DELHI ON 2 9 TH MARCH, 2008 (PAPER BOOK PAGE 37). RETURN FOR ASSESSMENT YEAR 2007 - 08 WAS ALSO FILED WITH ITO, WARD 5(3), NEW DELHI (PAPER BOOK PAGE 38), PROCESSED BY WARD 5(3) ON 30 TH MARCH, 2009(PAPER BOOK PAGE 39). RETURN FOR THE ASSESSMENT YEAR UNDE R CONSIDERATION I.E.2008 - 09 WAS ALSO FILE D WITH ITO WARD 5(3), NEW DELHI BY WHICH A REFUND OF RS.20,30,968 WAS CLAIMED FOR THE YEAR 2008 - 09. THE R ETUR N WAS FILED ONLINE. AS PER THE REQUIREMENT OF THE LAW AFTER FILING RETURN ONLINE, ITR - V, I.E. SIGNED VERIF ICATION WAS FILED WITH AO WARD 5(3), DELHI (PAPER BOOK PAGE 40). AS THE ASSES SEE DID NOT RECEIVE THE REFUND DUE AS PER THE RETURN , THEREFORE, IT FILED A LETTER DATED 3 R D JULY, 2010 (PAPER BOOK PAGE 18) WITH THE ITO WARD 5(3), NEW DELHI. THE A O , CONSEQUENT T O FOLLOW UP OF REFUND DUE TO IT, INFORMED THAT HE DOES NOT HAVE THE ACCESS TO THE PAN OF THE APPELLANT COMPANY AS PAN NUMBER OF THE APPELLANT COMPANY IS WITH THE I T O W A RD 4 ( 2 ) , A G RA. THE APPELLANT COMPANY IMMEDIATELY THEREAFTER CONTACTED ITO WARD 4(2), AGRA AND IT WAS INFORMED TO IT THAT A NOTICE UNDER SECTION 143(2) WAS ISSUED BY ITO WARD 4(2), AGRA ON 13 TH AUGUST, 2009. IT WAS AT THIS STAGE THAT THE APPELL ANT COMPANY CAME TO KNOW THAT A NOTICE UNDER SECTION 143(2) HAS BEEN ISSUED. THE ASSESSEE CONTENDED BEFORE ITO WARD 4(2), AGRA THAT THIS NOTICE HAS NOT BEEN RECEIVED. FURTHER, IN ANY CASE, ITO WARD 4(2) , DID NOT HAVE THE JURISDICTION AND AS SUCH THE NO TIC E ISSUED IS BAD IN LAW. THE FACTS WERE ALSO BOUGHT TO THE NOTICE OF THE ITO WARD 5(3) NEW DEL H I. THE ITO WARD 5(3) NEW DELHI REALIZING THE MISTAKE ASKED THE ITO WARD 4(2) AGRA TO SEND THE NOTICES ISSUED TO HIM AND THEREAFTER TOOK UP THE ASSESSMENT PRO CE EDINGS AND ISSUED A QUESTIONNAIRE WHICH HAS BEEN REPLIED TO BY THE ASSESSEE. 7 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) THESE FACTS RAISE TWO ISS UES. ( I ) THE FIRST ISSUE IS THAT OF THE JURISDICTION ON THE ASSESSEE COMPANY. AS PER THE ASSESSMENT ORDER AND THE ORDER OF THE CIT(A), THE ALLEGATION IS THAT THE JURISDICTION OF THE ASSESSEE COMPANY WAS WITH THE ITO WARD 4(2), AGRA AND HENCE THE ISSUE OF NOTICE UNDER SECTION 143(2) ON 13 TH AUGUST, 2009 IS WELL WITHIN TIME. (II) THE SECOND ISSUE IS THAT IN CASE ITO WARD 4(2), AGRA WAS HAVING JURISDICTION, WHETHER THE ASSESSMENT FRAMED BY THE ITO WARD 5(3), NEW DELHI WILL BE A VALID ASSESSMENT IN THE ABSENCE OF ANY ORDER PASSED UNDER SECTION 127 OF THE ACT BY THE COMMISSIONER OF INCOME TAX TRANSFERRING THE JURISDICTION FR OM ITO WARD 4(2), AGRA TO ITO WARD 5(3), N EW DELHI. 4. AS REGARDS THE FIR ST ISSUE IT WAS VEHEMENTLY SUBMITTED THAT IT IS AN ADMITTED FACT THAT THE APPELLANT COMPANY IS REGISTERED IN DELHI AND ITS REGISTERED OFFICE IS IN DELHI ONLY. IT IS ALSO A FACT THAT IT HAS BEEN FILING ITS RE TURN IN DELHI AND THOSE RETURNS HAVE BEEN PROCESS ED IN DELHI AS IS EVIDENT FROM PAPER BOOK PAGE 36 TO 39. THE JURISDICTION OF A COMPANY IS DETERMINED ON THE BASIS OF ITS REGISTERED OFFICE IN TERMS OF NOTIFICATION SO 732(E) DATED 31 ST JULY, 2001. AS PER THIS NOTIFICATION THE JURISDICTION OF THE COMPANY IS WHERE THE REGISTERED OFFICE IS SITUATED. IT WAS POINTED OUT THAT T HE CENTRAL BOARD OF DIRECT TAXES, AFTER RESTRUCTURING CARRIED OUT IN THE YEAR 2001, HAS ISSUED A NOTIFICATION NO. 255 DATED 31 ST JULY, 2001 [(SO - 732(E)]. AS PER THIS NOTIFICATION, IN EXERCISE OF THE POWER CONFERRED UNDER SECTION 120(1) & (2) AND IN SUPERSESSION OF THE EARLIER NOTIFICATION, IT HAS NOTIFIED THAT THE JURISDICTION OF THE PERSONS BEING COMPANIES REGISTERED UNDER THE COMPANIES ACT, 1956 AND HAVING REGISTERED OFFICE IN THE AREA MENTI ONED IN COLUMN 4(4) I.E. STATE SHALL BE WITH THE COMMISSIONER OF 8 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) IN COME TAX OF THAT STATE. SINCE ALPHABET OF THE COMPANY START WITH K, IN TERMS OF THIS NOTIFICATION, THE JURISDICTION OF THE COMPANY SHALL LIE WITH COMMISSIONER OF INCOME TAX - I I (ENTRY NO. 22 OF THE N O TIFI CAT ION). S ECONDLY, THE AO AND THE CIT( A) HAVE DRAWN AN ADVERSE INFERENCE ON THE BASIS OF AN APPLICATION FOR PAN. FIRSTLY IN VIEW OF THE NOTIFICATION ISSUED BY THE CBDT THE JURISDICTION OF A COMPANY HAS TO BE AS PER ITS REGISTERED OFFICE AND THERE IS NO OPTION OR CHOICE. FURTHER PAN CANNOT BE T HE BASIS OF JURISDICTION. PAN IS UNIVERSAL AND IT DOES NOT CHANGE WITH CHANGE OF PLACE, CITY, STATE OF THE ASSESSEE. IN THIS REGARD IT MAY ALSO BE IMPORTANT THAT CIT(A) HAS REFERRED TO THE RESIDENTIAL ADDRESS RATHER THAN THE OFFICE ADDRESS STATED IN THE PA N APPLICATION. THERE IS A COMMON APPLICATION FORM NO. 49A FOR ALLOTMENT OF PAN APP LICABLE TO ALL INDIAN CITIZENS/I NDIAN COMPANIES AS WELL .I TEM NO. 7 IN THIS FORM IS ADDRESS AND THE FIRST ADDRESS ASKED FOR IS THE RESIDENCE ADDRESS AND THE SECOND ADDRESS ASK ED FOR IS THE OFFICE ADDRESS. ITEM NO. 8 IS ADDRESS FOR COMMUNICATION WHERE TWO OPTIONS HAVE BEEN GIVEN I.E. RESIDENCE OR OFFICE. ITEM NO. 9 IS THE TELEPHONE NUMBER AND ITEM NO.10 IS THE STAT US. THE AO AND CIT(A) HAVE REFERRED TO THE RESIDE NCE ADDRESS WIT HOUT EVEN NOTICING AND REFERRING TO THE OFFICE ADDRESS GIVEN IN THE PAN APPLICATION AND ALSO THE TICK MARKED BY THE ASSESSEE COMPANY IN THE ADDRESS FOR COMMUNICATION AS OFFICE ADDRESS. THE APPLICATION FORM FOR PAN CANNOT BE A BASIS FOR JURISDICTION AND IN ANY CASE THE ASSESSEE HAS BEEN RIGHTLY FILING THE RETURN WITH ITO WARD 5(3), NEW DELHI AND THERE IS NO DENIAL TO THE FACT THAT THESE RETURNS HAVE BEEN PROCESSED BY ITO WARD 5(3), NEW DELHI. THUS IT WAS VEHEMENTLY CONTENDED THAT THE NOTICE ISSUED BY THE ITO WARD 4(2), AGRA WAS WITHOUT JURISDICTION. 5. IN THE ALTERNATIVE IT WAS SUBMITTED THAT EVEN IF IT IS ASSUMED THAT ITO WARD 4(2) AGRA HAS THE JURISDICTION AND HE HAS RIGHTLY ISSUED THE NOTICE UNDER SECTION143(2) OF THE ACT, THEN THE ASSESSMENT NEED TO B E FRAMED BY THE ITO WARD 4(2), AGRA ONLY AND THE ASSESSMENT ORDER P ASSED BY ITO WARD 5(3), NEW 9 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) DELHI WILL BE NULLITY HAVING BEEN PASSED WITHOUT JURISDICTION. FURTHER IN CASE THE I TO WARD 4(2) AGRA WAS HAVING VALID JURISDICTION OVER THE ASSESSEE, THERE WAS NO NEED ON HIS PART TO TRANSFER THE F IL E TO ITO WARD 5(3), DELHI WITHOUT HAVING ANY ORDER OF TR ANS FER OF THE JURISDICTION PASSED BY ANY COMPETENT AUTHO RITY IN PURSUANCE WITH THE PROVISIONS OF SECTION 127 . THE ACTION OF THE ITO WARD 4(2) AGRA TRANSFERRING T HE NOTICES TO ITO WARD 5(3) MAKES IT CLEAR THAT ITO WARD 4(2) AGRA HAD ACTUALLY NO JURISDICTION OVER THE ASSESSEE AND THUS THE NOTICES ISSUED BY HIM UNDER SECTION 143(2) WAS BEYOND HIS JURISDICTION. THE JURISDICTION OF AN ASSESSE E HAVING BEEN ACQUIRED BY ONE AO CAN BE TRANSFERRED TO ANOTHER A O BY A PROCESS KNOWN TO LAW I.E. AFTER AN ORDER HAS BEEN PASSED BY CIT UNDER SECTION 127(1) OF THE INCOME TAX ACT. THIS IS AN ADMITTED FACT THAT NO SUCH ORDER HAS BEEN PASSED BY THE COMMISSIONER OF INCOME TAX. ACCORDIN GLY, IN CASE THE ITO WARD 4(2), AGRA WAS HAVING JURISDICTION ON THE DATE WHEN NOTICE UNDER SECTION 143(2) WAS ISSUED, THE ORDER PASS ED UNDER SECTION 143(3) BY THE I TO WARD 5(3), NEW DELHI SHALL BE WITHOUT JURISDICTION. IN THIS REGARD RELIANCE IS BEING PLAC ED ON THE FOLLOWING JUDGMENTS: (I) ITO VS. KRISHAN KU MAR GUPTA 16 DTR (DEL)(TRIB ) 1 IN THIS CASE THE COURT HAS OBSERVED AS UNDER: 12. WE HAVE HEARD BOTH THE PARTIES AND HAVE GONE THROUGH THE ORDERS OF THE AUTHORITIES BELO W. IT IS NOT IN DISPUTE THAT THE NOTICE UNDER S. 147 ISSUED BY THE ITO, WARD 25(4) ON THE BASIS OF THE ADDRESS MENTIONED IN THE BANK ACCOUNT OF THE ASSESSEE WITH THE SB I , ROHTAK ROAD, DSIDC, DELHI. HAVING RECEIVED THE NOTICE UNDER S. 148 ISSUED BY THE ITO, WARD 25(4) THE ASSESSEE RAISED OBJECTION CH ALLENGING THE JURISDICTION OF THE ITO, WARD 25(4) VIDE LETTER D T .30 TH APRIL, 2002. THE ASSESSEE MENTIONED THAT THE ASSESE HAD ADDRESSED AT 1821/50, NAIWALA, KAROL BAGH, NEW DELHI. THE ITO, WARD 25(4) THEREAFTER TR ANSFERRED THE FILE TO THE ITO, WARD 33(2), NEW DELHI, WHO ULTIMATELY COMPLETED THE ASSESSMENT UNDER S. 143(3)/ 148 OF THE ACT ON 24 TH MARCH, 2003. THE ITO, WARD 33(2) 10 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) DID NOT ISSUE ANY FRESH NOTICE UNDER S. 148 OF THE ACT TO THE ASSESSEE. HE HAD TAKEN UP T HE CASE FROM THE STAGE OF ISSUING THE NOTICE OF HEARING UNDER S. 142(1) OR 143(2) OF THE ACT. 13. FROM THE AFORESAID FACTS DISCUSSED ABOVE, IT IS CLEAR THAT THE ITO, WARD 25(4) HAD ACCEPTED THE ASSESSEES OBJECTION AND THEN TRANSFERRED THE FILE TO THE ITO, WARD 33(2), NEW DELHI. HAD THE ITO, WARD 25(4) HAD VALID JURISDICTION OVER THE ASSESSEE AND VALIDLY ISSUED THE NOTICE UNDER S. 147 OF THE ACT, THERE WAS NO NEED ON HIS PART TO TRANSFER THE FILE TO ITO, WARD 33(2), NEW DELHI WITHOUT HA VING ANY ORD ER OF TRANSFER OF THE JURISDICTION PASSED BY ANY C OM PETENT AUTHORITY. THE ACTION OF THE ITO, WARD 25(4) IN TRAN SFERRING THE FILE TO I TO, WARD 33(2), NEW DELHI WITHOUT ANY ORDER OF JURISDICTION TRANSFERRING THE FILE FROM HIS WARD TO I TO, WARD 23(2) BY THE C OMPETENT AUTHORITY, MAKES IT CLEAR THAT THE ITO, WARD 25(4) HAD ACTUALLY NO JURISDICTION OVER THE ASSESSEE AND THUS THE NOTICE ISSUED BY HIM UNDER S. 147 OF THE ACT WAS BEYOND HIS JURISDICTION. IT IS FURTHER CLEAR THAT THE ITO, WARD 33(2) DID NOT ISSUE ANY FRESH NOTICE UNDER S. 148 OF THE ACT TO THE ASSESSEE, BUT COMPLETED THE ASSESSMENT ON THE BASIS OF THE NOTICE ISSUED UNDER S. 148 BY THE ITO, WARD 25(4) WHICH IS NOT VALID AND WITHIN THE JURISDICTION INASMUCH AS NO VALID PROCEEDINGS UNDER S. 147 WERE INIT IATED BY THE AO, WARD 25(4), HAVING VALID JURISDICTION OVER THE PRESENT ASSESSEE. THE FACT THAT THE PRESENT ASSESSEE FILED HIS RETURN OF INCOME FOR THE ASST. YR. 1995 - 96 BEFORE THE ITO, WARD 24(1) IS NOT IN DISPUTE. IN THE ASSESSMENT FOR THE ASST. YR. 1995 - 96, THE AO CHARGED INTEREST UNDER S. 234AAGAINST WHICH THE ASSESSEE FILED AN APPLICATION UNDER S. 154 ON 5TH MAY, 2003 BEFORE THE ITO, WARD 24(1), WHO COMPLETED THE ASSESSMENT FOR THE ASST. Y R. 1995 - 96. THE ITO, WARD 24(1) THEN PASSED AN ORDER UN DER S. 154 ON 9 TH MAY, 2003 AND REDUCED THE INTEREST UNDER S. 234A TO RS. 17,040. IT IS THUS CLEAR THAT THE ITO, WARD 24(1) EXERCISED JURISDICTION OVER THE ASSESSEE ON 9 TH MAY, 2003 WHEN HE PASSED THE ORDER UNDER S. 154 ON AN APPLICATION FILED BY THE ASSESSEE UNDER S. 154 ON 5 TH MAY, 2003 WITH REFERENCE TO THE RETURN OF INCOME FOR THE ASST. YR. 1995 - 96. THE PRESENT NOTICE HAS BEEN ISSUED UNDER S. 147 BY THE ITO, WARD 25(4) ON 28 TH MARCH, 2002, WHEN THE JURISDICTION OVER THE ASSESSEES CASE 11 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) WAS WITH ITO, WARD 24(1), NEW DELHI. THUS, F ROM THIS ASPECT OF THE MATTER ALSO, THE NOTICE UNDER S. 147 ISSUED BY ITO, WARD 25(4) WAS WITHOUT JURISDICTION. 14. MOREOVER, THE ITO, WARD 33(2) WHO PASSED THE PRESENT ASSESSMENT ORDER WITHOUT ISSUING ANY FRESH NOTICE UNDER S. 148 OF THE ACT CANNOT BE SAID TO HAVE A VALID JURISDICTION OVER THE ASSESSEE UNLESS AND UNTIL THE CASE HAS BEEN TRANSFERRED TO HIM FROM ITO, WAR D 25(4), BY AN ORDER PASSED UNDER S. 127 OF THE ACT BY ANY COMPETENT AUTHORITY. IN THE PRESENT CASE, THE ITO WARD 33(2) HAD EXERCISED THE JURISDICTION MERELY ON THE BASISOF INTIMATION GIVEN BY THE ITO, WARD 25(4), AND MERELY ON FILE BEING TRANSFERRED BY TH E ITO, WARD 25(4) OF HIS OWN TO THE ITO, WARD 33(2). (II) RANJEET SIN G H VS. A C IT (2008) 10 DTR 181 WHEREIN THE TRIBUNAL HELD THAT NOTICE UNDER S. 148 ISSUED BY THE ITO AT GHAZIABAD TO THE ASSESSEE WHO WAS ASSESSED TO TAX IN DELHI WAS WITHOUT JURISDICTION AND, THEREFORE, ASSESSMENT FRAMED ON THE BASIS OF SAID NOTICE IS BAD IN LAW; IMPUGNED NOTICE WAS NOT IN SUBSTANCE AND EFFECT IN CONFORMITY WITH THE PROVISIONS OF S. 120 R/ W S. 147 AND THUS, THE PROVISIONS OF S. 292B ARE NOT APPLICABLE. (III) CIT VS. SMT. ANJAL I DUA (2008) 11 DTR (DEL) 93 WHEREIN THEIR LORDSHIPS OF DELHI HIGH COURT DISMISSING THE APPEAL OF THE REVENUE HELD AS UNDER: THE TRIBUNAL NOTED THAT THE REQUEST OF THE ASSESSEE TO TRANSFER THE JURISDICTION WAS NOTED IN THE LETTER DT.25 TH MARCH, 1998 , WHEREBY THE NO - OBJECTION OF CIT, NEW DELHI, WAS CONVEYED TO THE CIT, LUDHIANA. IT IS ALSO NOTED THAT THEREAFTER THE ASSESSEE SUBMITTED RETURNS FOR THE ASST. YRS. 1997 - 98 ONWARDS AT NEW DELHI. IT IS IN THESE FACTS AND CIRCUMSTANCES THAT THE TRIBUNAL CAME TO THE CONCLUSION THAT INSOFAR AS, THE ASSESSEE WAS CONCERNED, AFTER THE SAID TRANSFER, IT IS ONLY REVENUE AUTHORITIES AT NEW DELHI WHO HAD JURISDICTION OVER THE ASSESSEES CASES AND WHO WERE COMPETENT TO ISSUE A NOTICE IN TERMS OF S. 148. IT MAY ALSO BE P OINTED THAT PURSUANT TO THE ISSUANCE OF IMPUGNED NOTICE UNDER S. 148 ON 12 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) 28 TH MARCH, 2003, WHEN THE NOTICE UNDER S. 142(1) WAS ISSUED TO THE ASSESSEE IN DECEMBER, 2003, THE ASSESSEE BY HER REPLY DT. 21 ST JAN., 2004 INDICATED THAT HER AO WAS NOT LOCATED IN LUDHIANA, BUT WAS AT NEW DELHI. THE TRIBUNAL HAS COME TO THE CONCLUSION ON THE BASIS OF THE FACTS AVAILABLE ON THE REC OR D AND, NO SUBSTANTIAL QUESTION OF LAW ARISES IN THE PRESENT CA SE. NO INTERFERENCE WITH THE IMPUGNED ORDER IS CALLED FOR . THE APPEAL IS DI SMISSED. (IV) DR. (MRS.) K.B. KUMARVS. ITO (2010)41 DTR 423 (DEL) IN THIS CASE THE COURT HAS OBSERVED AS UNDER: 7. IN THIS VIEW OF THE MATTER AND RESPECTFULLY FOLLOWING THE DECISIONS (SUPRA), IT IS HELD THAT NOTICE UNDER S. 148 ISSUED B Y ITO, GHAZIABA D WAS WITHOUT JURISDICTION AND CONSEQUENT UPON THE SAME REASSESSMENT FRAMED BY THE AO, DELHI IS INVALID AND THE SAME IS ACCORDINGLY QUASHED. CONSEQUENTLY, THE ORDER OF THE LEARNED CIT(A) IS SET ASIDE ON THE LEGAL ISSUE RAISED BY THE ASSESSEE IN HER APPEAL. 6 . THE LD. DR ON THE OTHER HAND VEHEMENTLY CONTENDED THAT THE CONTROVERSY TO BE RESOLVED IN THESE GROUNDS ARE (A) WHETHER NOTICE U/S 143(2) ISSUED BY THE ITO, WARD - 4(2), AGRA WAS SERVED UPON THE ASSESSEE BEFORE THE LAST DATE PRESCRIBED FOR ISSUING THE NOTICE UNDER THE INCOME TAX ACT AND (B) WHETHER ITO, WARD - 4(2), AGRA HAD VALID JURISDICTION OVER THE ASSESSEE AT THE TIME OF ISSUE OF NOTICE U/S 143(2) OF THE INCOME TAX ACT. ACCORDING TO HIM, THE ASSESSEE FILED E - RETURN ON 30.9 .2008 FOR THE IMPUGNED ASSESSMENT YEAR WITH ITO, WARD - 4(2), AGRA. SUBSEQUENTLY, THE CASE WAS SELECTED FOR SCRUTINY AND NOTICE U/S 143(2) WAS ISSUED BY ITO, WARD - 4(2), AGRA ON 13.8.2009. THE NOTICE WAS SENT TO THE ADDRESS GIVEN IN THE RETURN I.E. C - 208, A /6, SAVITRA NAGAR, NR. SHEKHSARAI, PHASE - I, NEW DELHI 110 077. SIMULTANEOUSLY, NOTICE U/S 143(2) WAS ALSO SENT AND SERVED UPON ONE OF THE DIRECTORS, NAMELY SHRI MOHAN KHANDELWAL RESIDING AT 30 - A, MUNRO ROAD, AGRA CANTT. AGRA ON 23.9.2009. IN THE MEANTIME , PAN OF THE ASSESSEE COMPANY WAS MIGRATED FROM ITO, WARD - 4(2), AGRA TO ITO, 13 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) WARD - 5(3), DELHI ON 23. 3.2010 AND THEREAFTER THE ASSESSMENT PROCEEDINGS CONTINUED BEFORE ITO, WARD - 5(3), NEW DELHI. AS REGARD THE SUBMISSION OF THE ASSESSEE THAT THERE WAS NO VAL ID SERVICE OF THE NOTICE U/S 143(2) BEFORE THE TIME LIMIT PRESCRIBED I.E. BEFORE 30.9.2009, IT WAS SUBMITTED THAT THERE IS ENOUGH EVIDENCE DISCUSSED IN THE ORDER OF THE LOWER AUTHORITIES AND IT IS AN ADMITTED POSITION THAT NOTICE U/S 143(2) WAS ISSUED BY I TO, WARD - 4(2), AGRA ON 13.8.2009 AND WAS SENT THROUGH SPEED POST AT THE ADDRESS GIVEN BY THE ASSESSEE IN THE RETURN OF INCOME I.E. C - 208, A/6, SAVITRA NAGAR, NR. SHEKH SARAI, PHASE - I, NEW DELHI 110 077. IN ADDITION TO THIS, ANOTHER COPY OF THE NOTICE WAS SERVED UPON SHRI MOHAN KHANDELWAL, ONE OF THE DIRECTORS RESIDING AT 30 - A, MUNRO ROAD, AGRA CANTT. AGRA. THE VALIDITY OF THE ASSESSMENT PROCEEDINGS CONTINUED BY ITO, WARD - 5(3), NEW DELHI DEPENDS UPON THE VALIDATION OF THE INITIATION OF THE PROCEEDINGS FOR ASSESSMENT BY NOTICE ISSUED U/S 143(2) ON 13.8.2009 BY ITO, WARD - 4(2), AGRA. IF THE ISSUANCE OF NOTICE U/S 143(2) ON 13.8.2009 IS VALID, THE ORDER DT. 29.12.2010 PASSED BY ITO, WARD - 5(3), NEW DELHI WOULD NOT GET VITIATED AND THEREFORE WOULD REMAIN VALID. OUR ATTENTION WAS DRAWN TO AST INSTRUCTION NO. 108 DT. 18.7.2012 ISSUED BY DIT(SYSTEMS) - III, NEW DELHI. AS PER PARA 6 OF THE SAID INSTRUCTIONS, IT WAS ARGUED THAT IN ALL CASES UNDER COMPULSORY SCRUTINY, NOTICE U/S 143(2) WILL BE GENERATED FROM THE SYSTEM ONLY BY THE OFFICER HAVING PAN IN HIS/HER JURISDICTION. SINCE T HE ASSESSEE COMPANY IN HIS APPLICATION IN FORM 49A FOR ISSUANCE OF PAN NUMBER HAD FILLED IN THE PARTICULARS IN THE MANNER AS DETAILED IN THE CIT(A) ORDER , THE JURISDICTION VESTED WITH ITO, WA RD - 4(2), AGRA. THIS IS ALSO AN ADMITTED FACT THAT THE APPLICATION FOR PAN WAS FILED IN AGRA THROUGH NSDL. THE AO CALLED FOR THE RESPONSE FROM NSDL AND STATED IN THE REMAND REPORT DT. 20.9.2011 THAT NSDL MENTIONED THAT THE RESIDENTIAL ADDRESS OF THE ASSES SEE SHOWN IN FORM 49A IS 72 - 80, INDUSTRIAL ESTATE, NOONIHAI, AGRA, U.P. CIT(A) ALSO HAS GIVEN A CATEGORICAL FINDING THAT THE ASSESSEE COMPANY MADE REQUEST FOR ALLOTMENT OF PAN THROUGH THE OFFICE OF ITO, WARD - 4(2), AGRA. ON THE BASIS OF THE ADDRESS 14 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) GIVEN IN FORM 49A THE JURISDICTION OF THE ASSESSEE GOT ASSIGNED TO AGRA. IN CASE OF E - FILING OF THE RETURN, THE RETURN WILL AUTOMATICALLY GO TO THE AO WHO EXERCISES JURISDICTION IN CONNECTION WITH THE PAN ALLOTTED TO THE ASSESSEE. THUS, THE JURISDICTION TO ISS UE NOTICE U/S 143(2) WAS VESTED WITH ITO, WARD - 4(2), AGRA. RELIANCE WAS PLACED ON THE DECISION OF HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF AMARJIT SINGH TUT VS. UNION OF INDIA, 347 ITR 585 . IN THIS CASE IT WAS CONTENDED THAT THE ASSESSEE CHALLENGED THE VALIDITY OF THE NOTICE DT. 17.9.2008 ISSUED BY THE ACIT, JALANDHAR U/S 143(2) CONTENDING THAT VIDE NOTIFICATION DT. 28.9.2007 ISSUED U/S 120 THE JURISDICTION LIES WITH THE REVENUE AUTHORITIES AT CHANDIGARH. THE CONTENTION OF THE ASSESSEE I N THIS CASE WAS REJECTED BY THE HON'BLE HIGH COURT . ONE OF THE GROUNDS FOR REJECTION WAS THAT THE OBJECTION REGARDING TERRITORIAL JURISDICTION HAS TO BE RAISED AT THE EARLIEST OTHERWISE IT WOULD BE DEEMED TO HAVE BEEN WAIVED. ON THE SAME ANALOGY, NOTICE U/S 143(2) CANNOT BE HELD TO BE VOID FOR WANT OF JURISDICTION. THE ASSESSEE WAS UNABLE TO SHOW THE QUESTION OF TERRITORIAL JURISDICTION HAVING BEEN RAISED AT THAT TIME PRIOR TO 2.12.2009 WHEN SUCH OBJECTION WAS FORWARDED FOR THE FIRST TIME. ON THE QUESTIO N OF ORDER PASSED U/S 127 FOR TRANSFERRING THE JURISDICTION FROM AGRA TO NEW DELHI, LD. D R WAS FAIR ENOUGH THAT THE ASSESSING OFFICER AT AGRA TRANSFERRED THE FILE TO AO NEW DELHI ON THE BASIS OF THE PAN MIGRATED FROM AGRA TO NEW DELHI. 7. WE HEARD THE RI VAL SUBMISSIONS ALONG WITH THE ORDER OF THE TAX AUTHORITIES BELOW AND PURSUED THE DOCUMENTS AND EVIDENCES REFERRED TO US DURING THE COURSE OF HEARING FILED IN THE PAPER BOOK. WE HAVE ALSO GONE THROUGH THE CASE LAWS AS RELIED ON AND CITED BEFORE US. IT IS A N ADMITTED FACT THAT IN THIS CASE THE ASSESSEE HAS FILED RETURN THROUGH E FILING. ON THE BASIS OF THE PAN NO. ALLOTTED TO THE ASSESSEE, THE ASSESSING OFFICER WARD 4 ,AGRA ASSUMED JURISDICTION AND ISSUED NOTICE U/S 143(2) SENT TO THE ADDRESS GIVEN IN THE F ORM NO. 49A. WE NOTED AND PURSUED THE COPY OF THE FORM NO.49A AND NOTED THAT IN THE FORM 49A, 15 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) THE ASSESSEE HAS GIVEN THE RESIDENTIAL ADDRESS AT AGRA WHERE THE NOTICE U/S 143(2) WAS SENT BY THE REVENUE AS CONTE N DED BY THE LD. DR BUT IN THE SAME FORM 49A, T HE ASSESSEE HAS FILLED UP OFFICE ADDRESS AT NEW DELHI WHERE THE REGISTERED OFFICE OF THE ASSESSEE IS SITUATED. THIS IS ALSO AN UNDISPUTED FACT THAT FOR ALLOTMENT OF PAN, COMMON FORM 49A HAS BEEN PRESCRIBED WHETHER THE ASSESSEE IS AN INDIVIDUAL OR HUF OR F IRM OR AOP OR AN INCORPORATED COMPANY. THE COMPANY BEING ARTIFICIAL JUDICIAL PERSON CANNOT HAVE RESIDENCE. IT IS NOT A HUMAN BEING. IT QUITE NATURAL THAT A PERSON WHO IS NOT AWARE OF TECHNICALITIES MAY PRESUME THAT ALL THE COLUMNS GIVEN IN FORM 49A HAVE TO BE FILLED UP AND ACCORDINGLY, HE MIGHT HAVE FILLED THAT RESIDENTIAL ADDRESS OF THE DIRECTOR TO BE THE RESIDENTIAL ADDRESS OF THE COMPANY INSTEAD OF WRITING N.A. BUT SUBSEQUENT TO THIS, THE PERSON WHO FILLED UP FORM 49A HAS GIVEN OFFICE ADDRESS AS C - 208, ESTEEM COMPLEX, SAVITRI NAGAR, NR. SHEIKH SARAI, PHASE - I, NEW DELHI. THE REVENUE WHICH IS SUPPOSED TO KNOW THE INCOME TAX AS THEY HAVE TO DEAL WITH THE INCOME TAX, COULD ALSO NOT BE ABLE TO FILL UP THE OFFICE ADDRESS AND IGNORED IT AND GENERATED TH E PA N NUMBER ON THE BASIS OF RESIDENTIAL ADDRESS WHEN A COMPANY CANNOT HAVE RESIDENTIAL ADDRESS AND UNDER THE INCOME TAX ACT IN THE CASE OF THE COMPANY, THE JURISDICTION OF THE ASSESSING OFFICER DEPENDS ON THE PRINCIPAL OFFICE/REGISTERED OFFICE OF THE COMP ANY AS PER SEC. 120 VIS - - VIS SEC. 124 . THE ASSESSEE ONCE HAS SUBMITTED THE INFORMATION; THE CORRECT LEGAL INFERENCE HAS TO BE DRAWN BY THE REVENUE AUTHORITIES. IN THE CASE OF THE COMPANY, JURISDICTION CANNOT BE DETERMINED ON THE BASIS OF THE RESIDENTIAL ADDRESS. WE THEREFORE REJECT THE PLEA OF THE LD. DR THAT SINCE THE ASSESSEE HAS SHOWN RESIDENTIAL ADDRESS AT AGRA, THEREFORE, THE ASSESSING OFFICER AT AGRA HAS THE VALID JURISDICTION OVER THE ASSESSEE. WE ALSO NOTED THAT GENERALLY WHENEVER THERE IS DEFIC IENCY IN FORM 49A, THE REVENUE DOES NOT ALLOT PAN BUT ISSUED DEFICIENCY LETTER. ALLOTTING PAN ON THE BASIS OF RESIDENTIAL ADDRESS IN THE CASE OF THE COMPANY DENOTES NON APPLICATION OF MIND BY THE REVENUE AUTHORITIES AND ALLOTTING PAN IN A MECHANICAL MANNE R. WE HAVE ALSO PERUSED THE RELEVANT 16 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) PROVISIONS OF SECTION 120, 124 AND 127 RELATING TO THE JURISDICTION BUT WE DID NOT FIND ANY PROVISIONS WHICH STATES THAT JURISDICTION WILL BE ON THE BASIS OF THE ADDRESS GENERATED IN PAN OR RESIDENTIAL ADDRESS OF THE C OMPANY . WE, THEREFORE REJECT THIS PLEA OF LD. DR. 8. IT IS NOT DENIED BY THE LD. AR THAT THE DIRECTOR OF THE COMPANY SHRI MOHAN KHANDELWAL WAS PUTTING UP AGRA AT THE RESIDENTIAL ADDRESS GIVEN IN FORM 49A. EVEN NO AFFIDAVIT IN THIS REGARD WAS FILED EITHE R BEFORE US OR BEFORE THE AUTHORITIES BELOW. IN THE IMPUGNED CASE AO AGRA HAS ISSUED NOTICE ON 13.8.2009 I.E. PRIOR THE SUBSTITUTION OF NEW PROVISIONS OF SECTION 282 DEALING WITH THE SERVICE OF NOTICE. U/S 282 (1) A NOTICE OR REQUISITION UNDER THE INCOME TAX ACT MAY BE SERVED ON THE PERSON NAMED THEREIN EITHER BY POST OR AS IF IT WERE A SUMMONS ISSUED BY A COURT UNDER THE CODE OF CIVIL PROCEDURE,1908. SUBSECTION 2 SECTION 282 STATES IN THE CASE OF THE COMPANY, THAT SUCH NOTICE OR REQUISITION MAY BE ADDRES SED TO THE PRINCIPAL OFFICER THEREOF. A DIRECTOR IN VIEW OF DEFINITION OF PRINCIPAL OFFICER GIVEN U/S 2(35) CANNOT BE REGARDED TO BE A PRINCIPAL OFFICER IN THE CASE OF THE COMPANY UNTIL AND UNLESS THE CASE FALLS U/S 2(35)(B) AND FOR WHICH THE ASSESSING OF FICER SHOULD HAVE SERVED A NOTICE OF HIS INTENTION TO TREAT HIM AS THE PRINCIPAL OFFICER IN ORDER THAT HE MAY BE BROUGHT UNDER SUB CLAUSE (B) OF SECTION 2(35). THE NOTICE ISSUED U/S 143(2) DT. 13.8.2009 HAS NOT BEEN PRODUCED BEFORE US. SUBSEQUENT NOTICE U/S 143(2) DT. 14.9.2010 WAS ISSUED BY THE AO, WARD - 5(3) AT NEW DELHI ADDRESS BUT IT IS BARRED BY LIMITATION. THIS IS A THRESHOLD REQUIREMENT FOR A VALID ASSESSMENT. THIS NOTICE IS ADDRESSED TO THE COMPANY. THE LD. DR VEHEMENTLY CONTENDED THAT THE NOTICE ISSUED U/S 143(2) DT. 13.8.2009 WAS IN THE NAME OF THE COMPANY. THIS FACT HAS NOT BEEN DENIED BY THE ASSESSEE. THIS IS ALSO A FACT THAT THE NOTICE WAS SENT THROUGH SPEED POST AT THE RESIDEN TIAL ADDRESS OF THE COMPANY. THE ASSESSEE DID NOT FILE ANY AFFIDAVIT IN THIS REGARD TO DENY SERVICE OF THE SAID NOTICE AT THE RESIDENTIAL ADDRESS OF THE DIRECTOR EVEN THOUGH THE LD. AR CONTENDED THAT NO 17 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) SUCH NOTICE WAS RECEIVED ISSUED BY THE AO, AGRA. WH ERE THE ASSESSEE CLAIMS THAT HE HAS NOT RECEIVED THE NOTICE, IT IS FOR REVENUE TO PROVE SUCH SERVICE. MERE FACT, THAT NOTICE WAS SENT BY REGISTERED POST, IS NOT SUFFICIENT, WHEN THERE WAS NO ACKNOWLEDGEMENT OF SUCH SERVICE, SO THAT THE TRIBUNALS ORDER SE TTING ASIDE THE ASSESSMENT ON THE BASIS OF AN AFFIDAVIT FROM THE ASSESSEE, THAT HE HAS NOT RECEIVED THE SAME WITHIN THE PRESCRIBED TIME LIMIT WAS UPHELD BY THE DELHI HIGH COURT IN CIT VS. LUNAR DIAMONDS LTD., 281 ITR 1 (DEL.) . THIS DECISION WILL NOT ASSIS T THE ASSESSEE AS THE ASSESSEE DID NOT FILE ANY AFFIDAVIT. 9. WE NOTED THAT T HE SUPREME COURT IN L.N. HOTA AND COMPANY VS. CIT, 301 ITR 184 (SC) HAS HELD THAT A NOTICE UNDER SECTION 142(1) IS NOT A SUBSTITUTE FOR SECTION 143(2), SO THAT NON - ISSUE OF NOTICE UNDER SECTION 143(2) WOULD INVALIDATE THE ASSESSMENT REVERSING THE DECISION OF THE HIGH COURT ON THIS POINT. 10. THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. YAMU INDUSTRIES LTD., 306 ITR 309 (DELHI) HAS TAKEN THE VIEW THAT IF NOTICE SENT BY REGISTERED POST AND SUCH NOTICE WAS NOT RETURNED, THERE IS A PRESUMPTION OF SERVICE OF THE NOTICE. SIMILAR VIEW HAS BEEN TAKEN BY THE HON'BLE DELHI HIGH COURT IN T HE CASE OF CIT VS. MADHSY FILMS P. LTD., 301 ITR 69 (DELHI) IN WHICH THE HON'BLE HIGH COURT TOOK THE VIEW THAT WHERE A NOTICE WAS SENT BY SPEED POST BUT WAS NOT RETURNED UNDELIVERED, THERE IS A PRESUMPTION OF SERVICE WITHIN THE REASONABLE TIME OF THREE DAYS, SO AS TO BE VALID IN THE CONTEXT OF ASSESSEE NOT HAVING FILED ANY AFFIDAVIT OF NON - RECEIPT OF NOTICE. WE NOTED THAT THE NOTICE ISSUED BY THE ITO, WARD - 4(2), AGRA DT. 13.8.2008 WAS SENT BY SPEED POST AT THE ADDRESS GIVEN BY THE ASSESSEE COMPANY IN THE RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION I.E. C - 208, ESTEEM COMPLEX, SAVITRI NAGAR, NR. SHEIKH SARAI, PHASE - I, NEW DELHI . ANOTHER COPY OF THE NOTICE WAS SERVED UPON THROUGH SHRI MOHAN KHANDELWAL, ONE OF THE DIRECTORS OF THE ASSESSEE COMPANY RESIDING AT 30 - A, MUNRO ROAD, AGRA CANTT. AGRA . IN VIEW OF THIS FACT, THE CIT(A) TOOK THE 18 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) VIEW THAT NOTICE U/S 143(2) HAS BEEN DULY ISSUED AND S ERVED UPON THE ASSESSEE COMPANY WITHIN THE TIME PRESCRIBED U/S 143(2). THE LD. AR BEFORE US NO DOUBT VEHEMENTLY CONTENDED BUT HAS NOT FILED ANY AFFIDAVIT THAT THIS NOTICE HAS NOT BEEN RECEIVED BY THE ASSESSEE COMPANY OR ANY OF ITS DIRECTORS. IT IS ALSO D ENIED THAT THE NOTICE WAS NOT ADDRESSED TO THE COMPANY. IN VIEW OF THESE FACTS, WE ARE OF THE VIEW THAT THE CASE OF THE ASSESSEE IS DULY COVERED BY THE DECISION OF THE JURISDICTION HIGH COURT IN THE CASE OF CIT VS. MADHSY FILMS P. LTD., 301 ITR 69 ( SUPRA ) . WE ACCORDINGLY CONFIRM THE FINDING OF THE CIT(A) IN THIS REGARD. 11. NOW THE QUESTION BEFORE US ARISES WHETHER THE AO, AGRA HAD THE VALID JURISDICTION TO ISSUE THE NOTICE U/S 143(2). U/S 120 OF THE INCOME TAX ACT THE BOARD MAY ISSUE DIRECTIONS OR ORDERS DETERMINING THE JURISDICTION OF THE INCOME TAX AUTHORITIES ON THE BASI S OF ONE OR MORE OF THE FOLLOWING CRITERIA VIZ. (A) TERRITORIAL AREA, (B) PERSONS OR CLASS OF PERSONS, (C) INCOME OR CLASSES OF INCOME, (D) CASES OR CLASS OF CASES. U/S 124(1) THE AO HAS BEEN VESTED WITH JURISDICTION OVER ANY AREA. WITHIN THE LIMITS OF S AID AREA, HE SHALL HAVE JURISDICTION (A) IN RESPECT OF ANY PERSON CARRYING ON A BUSINESS OR PROFESSION IF THE PLACE AT WHICH HE CARRIES ON HIS BUSINESS OR PROFESSION IS SITUATE WITHIN THE AREA OR WHERE HIS BUSINESS OR PROFESSION IS CARRIED OUT IN MORE PLAC ES THAN ONE, IF THE PRINCIPAL PLACE OF HIS BUSINESS OR PROFESSION IS SITUATE WITHIN THE AREA AND (B) IN RESPECT OF ANY SUCH PERSON RESIDING WITHIN THE AREA. IN THE CASE OF THE ASSESSEE, IT IS NOT DENIED THAT THE PRINCIPAL PLACE OF THE BUSINESS OF THE ASSE SSEE WAS SITUATED AT SHEIKH SARAI, NEW DELHI. THE PRINCIPAL PLACE OF BUSINESS OF THE ASSESSEE WAS NOT SITUATED AT AGRA. IT IS ALSO NOT DENIED THAT THE ASSESSEE COMPANY WAS ENGAGED IN CARRYING ON BUSINESS. IT WAS NOT RESIDENT OF AGRA AS IT IS NOT A HUMAN BEING. SEC. 124(3) STOPS THE ASSESSEE FROM RAISING OBJECTION ABOUT JURISDICTION OF AN AO WHERE THE ASSESSEE HAS FILED THE RETURN U/S 139 AFTER THE EXPIRY OF ONE MONTH FROM THE DATE ON WHICH HE WAS SERVED WITH NOTICE U/S 142(1) OR U/S 143(2) OR AFTER THE COMPLETION OF THE ASSESSMENT, WHICHEVER IS 19 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) EARLIER. IT IS NOT DENIED THAT IN THE CASE OF THE ASSESSEE THE RETURN FOR THE IMPUGNED ASSESSMENT YEAR WAS FILED ON 30.9.2008 . T HEREFORE, THE EARLIEST THE ASSESSEE CAN OBJECT THE JURISDICTION IS BY 30.10.2008. NOTICE IN THE CASE OF THE ASSESSEE HAS BEEN ISSUED ON 13.8.2009 U/S 143(2) BY THE AO, AGRA. SEC. 124(3) USES THE WORD SERVICE OF THE NOTICE, NOT ISSUING OF THE NOTICE BUT SINCE THE ASSESSEE HAS NOT REBUTTED THIS FACT BY FILING AFFIDAVIT, THEREFORE, WE H AVE HELD IN THE PRECEDING PARAGRAPHS THAT THIS IS A CASE WHERE IT WOULD BE DEEMED THAT THE NOTICE HAS BEEN DULY SERVED ON THE ASSESSEE. IN VIEW OF THIS FACT, AFTER THE EXPIRY OF 3 DAYS THE ASSESSEE SHOULD HAVE FILED THE OBJECTION ABOUT THE JURISDICTION WI THIN 30 DAYS I.E. UPTO 15.9.2009 BUT THE ASSESSEE HAS NOT FILED ANY SUCH OBJECTION. THEREFORE, WE DO NOT FIND ANY ILLEGALITY OR INFIRMITY IN THE ORDER OF CIT(A) IN THIS REGARD BUT THE REMOTE QUESTION BEFORE IS IF THE AO, AGRA WAS HAVING JURISDICTION ON TH E ASSESSEE HOW CAN HE HIMSELF TRANSFER THE FILE TO THE AO, WARD 5(3), NEW DELHI MERELY ON THE BASIS OF CHANGE OF ADDRESS IN THE PAN. THERE IS A SEPARATE PROVISION MADE U/S 127 IN THIS REGARD. ON PERUSAL OF THIS SECTION IT IS APPARENT THAT U/S 127(2) IF T HE AO FROM WHOM THE CASE IS TO BE TRANSFERRED AND THE AO TO WHOM THE CASE IS TO BE TRANSFERRED ARE NOT UNDER THE JURISDICTION OF SAME CHIEF COMMISSIONER OR COMMISSIONER, THE CHIEF COMMISSIONER OR COMMISSIONER TO WHOM SUCH AO ARE SUBORDINATE ARE IN AGREEMEN T, THEN, THE CHIEF COMMISSIONER OR COMMISSIONER FROM WHOSE JURISDICTION THE CASE IS TO BE TRANSFERRED HAS TO GIVE A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE PASSING THE ORDER FOR TRANSFER. IT IS NOT DENIED IN THE CASE OF THE ASSESSEE T HAT THE AO AT AGRA AND THE AO AT NEW DELHI WERE UNDER THE JURISDICTION OF DIFFERENT CCIT AS WELL AS DIFFERENT COMMISSIONERS. THEREFORE, THE AO, AGRA DOES NOT HAVE ANY JURISDICTION TO TRANSFER THE FILE TO AO AT NEW DELHI. THE FILED COULD HAVE BEEN TRANSFE RRED ONLY BY THE CHIEF COMMISSIONER OR THE COMMISSIONER OF THE AO, AGRA AFTER GIVING HEARING TO THE ASSESSEE. IN THIS CASE, WE NOTED THAT THE AO, AGRA HAS NOT COMPLIED WITH THE MANDATORY REQUIREMENT OF SEC. 127 BUT SUO MOTO TRANSFERRED 20 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) THE FILE FROM AGRA TO AO, NEW DELHI AS IF HE HAS ENTERED INTO THE SHOES OF THE CHIEF COMMISSIONER OR COMMISSIONER OF INCOME TAX. WE NOTED THAT THE HON'BLE DELHI HIGH COURT IN THE CASE OF ATS PROMOTERS AND BUILDERS PVT. LTD. VS. CHIEF CIT, 308 ITR 65 (DELHI) HAS SET ASIDE TH E TRANSFER BY TAKING THE VIEW THAT THE TRANSFER OF ASSESSEES CASE FROM DELHI TO MEERUT WAS WITHOUT DISCLOSING THE PROPER APPLICATION OF MIND TO THE OBJECTIONS RAISED BY THE ASSESSEE . 12. IN POWER CONTROLS VS. CIT, 241 ITR 807 (DELHI), THE COMMISSIONER TR ANSFERRED A FILE AFTER A SHOW CAUSE NOTICE BUT SINCE SUCH SHOW - CAUSE NOTICE DID NOT GIVE REASONS FOR THE PROPOSED TRANSFER, THE SUBSEQUENT ORDER OF TRANSFER WAS HELD TO BE VITIATED AND WAS QUASHED. 13. A TRANSFER CAN BE MADE BY THE COMMISSIONER FROM ONE OFFICER TO ANOTHER UNDER SECTION 127 OF THE INCOME TAX ACT, 1961. BUT IT SHOULD BE FOR GOOD REASON AFTER A SHOW - CAUSE NOTICE TO THE ASSESSEE, WHERE TRANSFER IS FROM ONE STATION TO ANOTHER. WHERE NO REAS ONS WERE ASSIGNED FOR THE TRANSFER AND A WRIT PETITION WAS FILED AGAINST THE SAME BEFORE THE HIGH COURT, IT WAS EXPLAINED THAT THE COMMISSIONER HAD RECORDED HIS REASONS, THOUGH HE DID NOT COMMUNICATE THE SAME. THE HIGH COURT IN DEEP MALHOTRA VS. CHIEF CIT , 334 ITR 232 (P&H) POINTED OUT THAT THERE ARE A NUMBER OF DECISIONS OF THE HIGH COURT AND THAT OF THE SUPREME COURT IN AJANTHA INDUSTRIES VS. CBDT, 102 ITR 281 (SC) AS TO THE NEED FOR A SPEAKING ORDER. SINCE THE ALLEGED REASONS RECORDED WERE NOT PART OF T HE ORDER, THE ORDERS WERE HELD TO BE INVALID, WHILE LEAVING IT OPEN TO THE COMMISSIONER TO PASS A FRESH ORDER. 14. IN THE IMPUGNED CASE THERE IS A VIOLATION OF THE PROVISIONS OF SEC. 127 AND IN VIEW OF THERE BEING NO TRANSFER ORDER BEING PASSED BY THE CHI EF COMMISSIONER OR COMMISSIONER, WE HOLD THAT THE ORDER PASSED BY THE AO, WARD - 5(3), NEW DELHI FOR THE IMPUGNED ASSESSMENT YEAR IS INVALID AND VOID AB 21 ITA NO. 23/DEL/2012 (A.Y : 2008 - 09) INITIO . WE ACCORDINGLY QUASH THE SAME. SO FAR AS THE OTHER GROUNDS TAKEN BY THE ASSESSEE ARE CONCERNED, SINCE WE HAVE ALREADY QUASHED THE ASSESSMENT ORDER, THEREFORE, ADJUDICATION OF THE OTHER GROUNDS ARE NOT REQUIRED. 15. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. 16. ORDER PRONOUNCED IN PURSUANCE OF RULE 34(4) OF ITAT RULES, 1963 BY PUT TING ON NOTICE BOARD OF THE BENCH AT DELHI ON 1 7 / 0 4 /2015. S D / - ( SMT. DIVA SINGH ) JUDICIAL MEMBER S D / - (P.K. BANSAL) ACCOUNTANT MEMBER DATED : 1 7 / 0 4 / 201 5 *SSL* COPY TO : (1) APPELLANT (2) RESPONDENT (3) CIT(A) CONCERNED (4) CIT CONCERNED (5) D.R (6) GUARD FILE TRUE COPY, BY ORDER ,