BHAGWAN SAHAI, Jaipur V. ITO, Jaipur

ITA 51/JPR/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 8833 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 8 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 13-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEENA JEPH JCIT DHK
• Keywords: Salary income; Valuation report; Reason to believe; Reassessment proceedings
• Section: 54F; 142(1); 133(6); 143(1); 143(2); 147; 131; 68; 148; 144; 139

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH SMC, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; DS LE{K BEFORE: SHRI SHRI VIJAY PAL RAO, JUDICIAL MEMBER VK;DJ VIHY LA-@ ITA NO. 51/JP/2017 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2006-07. SHRI BHAGWAN SAHAI C/O SHRI O.P. AGARWAL, FCA H-8, CHITRANJAN MARG, C-SCHEME, JAIPUR. CUKE VS. INCOME TAX OFFICER, WARD 7(2), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. ABTPJ 9498 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI MANISH AGARWAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SMT. NEENA JEPH (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 16.09.2019. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 17/09/2019. VKNS'K@ ORDER PER VIJAY PAL RAO, JM : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 26.10.2016 OF LD. CIT (A)-3, JAIPUR FOR THE ASSESSMENT YEAR 2006- 07. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LD. CIT (A) HAS GROSSLY ERRED IN UPHOLDING THE IMPUGNED REA SSESSMENT ORDER OF LD. AO BY IGNORING THE FACT THAT THE SAID ORDER HAS BEEN PASSED WITHOUT JURISDICTION AND THEREFORE IS PRIMA FACIE BAD IN LAW AND DESERVES TO BE QUASHED. 1.1. THAT, THE LD. CIT (A) HAS FURTHER ERRED IN FAILING TO APPRECIATE THE FACT THAT THE JURISDICTION OVER THE CASE OF ASS ESSEE LIES WITH INCOME TAX OFFICER, WARD-1, HANUMANGARH, AND NOT WI TH THE INCOME TAX OFFICER, WARD 7(2), WHO HAS PASSED THE I MPUGNED REASSESSMENT ORDER. THUS, THE ORDER OF LD. AO DESER VES TO BE QUASHED. 2 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. 1.2. THAT, THE LD. CIT (A) HAS FURTHER ERRED IN REJECTIN G THE AFORESAID OBJECTION OF ASSESSEE MERELY ON THE GROUND THAT THI S GROUND WAS NOT RAISED BEFORE AO AND THAT THE ASSESSEE HAS PARTICIPATED IN THE ASSESSMENT PROCEEDINGS, BY COMPLETELY IGNORI NG THE WELL ESTABLISHED LAW THAT THE QUESTION OF JURISDICTION C AN BE RAISED AT ANY STAGE AND THAT THE DEFECT OF LACK OF JURISDICTI ON IS A MATERIAL ONE AND NOT ONE WHICH CAN BE CURED U/S 292 OF THE I NCOME TAX ACT, 1961. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT (A) HAS FURTHER ERRED IN UPHOLDING THE ADDITION OF RS. 74,796/- MADE BY LD. AO BY WAY OF DISALLOWANCE OF BROKERAGE EXPENSES PAID BY ASSESSEE ON THE SALE/PURCHASE OF LAND UNDER TAKEN BY ASSESSEE. THUS, THE ADDITION OF RS. 74,796/- DESERV ES TO BE DELETED. 2.1. THAT, THE LD. CIT (A) HAS FURTHER ERRED IN IGN ORING THE EVIDENCES SUBMITTED BY ASSESSEE IN SUPPORT OF THE FACT OF PAY MENT OF BROKERAGE IN THE SHAPE OF CONFIRMATION AND ID OF TH E BROKER, HOWEVER, THE LD. CIT (A) HAS UPHELD THE IMPUGNED AD DITION MERELY ON THE GROUND THAT THE BROKER WAS NOT PRODUC ED BEFORE THE LD. AO, BY COMPLETELY IGNORING THE FACT THAT RE QUEST WAS MADE BEFORE THE LD. AO TO SUMMON THE BROKER U/S 131 / 133(6) AND EXAMINE, SINCE HIS CONFIRMATION AND ID PROOF WA S SUBMITTED BEFORE LD. AO. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) HAS FURTHER ERRED IN UPHOLDING THE DISALLOWANCE OF ASSESSEES CLAIM OF DEDUCTION U/S 54F OF THE ACT, BY WRONGLY OBSERVI NG THAT THE CONSTRUCTION OF RESIDENTIAL PROPERTY HAS NOT BEEN C OMPLETED BY THE STIPULATED DATE. THUS, THE ACTION OF LD. CIT(A) DES ERVES TO BE HELD BAD IN LAW AND THE ADDITION OF RS. 27,41,000/- MADE BY WAY OF SUCH DISALLOWANCE DESERVES TO BE DELETED. 3.1. THAT, THE LD. CIT (A) HAS FURTHER ERRED IN BRUSHING ASIDE THE VALUATION REPORT OF THE REGISTERED VALUER WHEREIN, THE CONSTRUCTION OF RESIDENTIAL PROPERTY HAS CLEARLY BE EN SHOWN TO HAVE COMPLETED IN THE MONTH OF MARCH, 2006. THUS, I N THE PRESENCE OF RELIABLE EVIDENCE TO THIS EFFECT, THE L D. CIT (A) COULD NOT HAVE UPHELD THE IMPUGNED DISALLOWANCE. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) HAS FURTHER ERRED IN CONFIRMING THE ADDITION OF RS. 22,50,161/- MADE BY LD. AO U/S 68 BY HOLDING THE DEPOSITS MADE BY ASSESSEE IN HIS BANK ACCOUNT AS HIS UNDISCLOSED INCOME WITHOUT ANY BASIS. THUS, THE ADDITION OF RS. 22,50,161/- SO SUSTAINED BY THE LD. CIT (A) DESERVES TO BE DELETED. 3 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. 4.1. THAT, THE LD. CIT (A) HAS FURTHER ERRED IN IGNORING THE EVIDENCES AND EXPLANATIONS FURNISHED BY THE ASSESSEE IN SUPPO RT OF THE SOURCE OF DEPOSITS MADE BY ASSESSEE. THUS, THE ADD ITION OF RS. 22,50,161/- DESERVES TO BE DELETED. 5. THAT THE APPELLANT CRAVES THE RIGHT TO ADD, DELETE, AMEND OR ABANDON ANY OF THE GROUNDS OF APPEAL EITHER BEFORE OR AT THE TIME OF HEARING OF APPEAL. GROUND NOS. 1 TO 1.2 ARE REGARDING VALIDITY OF REAS SESSMENT ORDER PASSED BY THE AO FOR WANT OF JURISDICTION. 2. THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOME FROM SALARY AND AGRICULTURE. THE ASSESSEE FILED HIS ORIGINAL RETURN OF INCOME UN DER SECTION 139 ON 14.08.2007 WITH ITO HANUMANGARH DECLARING TOTAL INCOME AT RS.1 ,16,960/-. THE RETURN OF INCOME WAS PROCESSED UNDER SECTION 143(1) ON 20 TH MARCH, 2008 BY THE ITO WARD-1, HANUMANGARH. SUBSEQUENTLY, THE ITO WARD 7(2), JAIPU R ISSUED A NOTICE UNDER SECTION 148 ON 26 TH MARCH, 2013 TO ASSESS THE LONG TERM CAPITAL GAIN A RISING FROM THE SALE OF LAND. THE REASSESSMENT PROCEEDINGS WERE COM PLETED UNDER SECTION 144 READ WITH SECTION 147 OF THE IT ACT AT A TOTAL INCOME OF RS. 44,75,323/- ON 10 TH FEBRUARY, 2014 WHEREBY THE AO MADE ADDITION ON ACCOUNT OF LON G TERM CAPITAL GAIN, DEPOSITS IN THE BANK ACCOUNT AND INTEREST INCOME FROM BANK. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT (A) AND RAISED THE OBJECTION AGAINST THE VALIDITY OF REASSESSMENT ORDER PASSED BY THE AO FOR WANT OF JURISDICTION. HOWEVER, THE LD. CIT (A) REJECTED THE SAID OBJECTION OF THE ASSESSEE AGAINST THE JURISDICTION OF THE AO TO PASS THE REASSESSMENT ORDER. 3. BEFORE US, THE LD. COUNSEL OF THE ASSESSEE HAS S UBMITTED THAT THE AO UNDER THE CHARGE OF WARD 7(2) JAIPUR HAS INITIATED THE PR OCEEDINGS UNDER SECTION 147/148 4 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. WITHOUT HAVING THE JURISDICTION OVER THE ASSESSEE. ONCE THE ASSESSEE HAS FILED THE RETURN OF INCOME WITH THE ITO WARD-1, HANUMANGARH A ND THE RETURN OF INCOME WAS PROCESSED BY THE ITO WARD-1, HANUMANGARH, THEN THE ITO WARD 7(2), JAIPUR HAS NO JURISDICTION TO INITIATE THE PROCEEDINGS UNDER SECT ION 147/148 OF THE IT ACT. THEREFORE, THE REASSESSMENT ORDER PASSED BY THE AO IS INVALID AND LIABLE TO BE QUASHED. IN THE ABSENCE OF ANY ORDER PASSED UNDER SECTION 127/124 OF THE IT ACT TO TRANSFER THE JURISDICTION FROM ITO WARD-1, HANUM ANGARH TO ITO WARD 7(2), JAIPUR, THE PROCEEDINGS INITIATED UNDER SECTION 147 /148 ARE BAD IN LAW AND LIABLE TO BE QUASHED. IN SUPPORT OF HIS CONTENTION, HE HAS R ELIED UPON THE DECISION OF HONBLE BOMBAY HIGH COURT IN CASE OF CIT VS. INCOME TAX SET TLEMENT COMMISSION & OTHERS, 365 ITR 87 (BOM) AS WELL AS THE JUDGMENT DATED 17 TH APRIL, 2015 IN CASE OF M/S. MAVANY BROTHERS VS. CIT IN TAX APPEAL NO. 8/2007 (6 2 TAXMAN.COM 50)(BOM). THE LD. COUNSEL HAS SUBMITTED THAT MERELY BECAUSE THE A SSESSEE APPEARED BEFORE THE AO IN THE REASSESSMENT PROCEEDINGS WOULD NOT BY ITSELF BESTOW JURISDICTION TO THE AO. THUS THE LD. COUNSEL HAS PLEADED THAT THE IMPUGNED REASSESSMENT ORDER IS ILLEGAL AND LIABLE TO BE QUASHED. 4. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED THA T THE ASSESSEE HAS GIVEN HIS ADDRESS OF JAIPUR AND, THEREFORE, THE ITO WARD 7(2) JAIPUR WAS HAVING THE TERRITORIAL JURISDICTION OVER THE ASSESSEE TO ASSESS THE INCOME OF THE ASSESSEE. SHE HAS FURTHER CONTENDED THAT THE ASSESSEE DID NOT RAISE THIS OBJE CTION BEFORE THE AO AND, THEREFORE, AFTER COMPLETION OF THE REASSESSMENT PRO CEEDINGS, THE ASSESSEE IS NOT ALLOWED TO RAISE THIS OBJECTION. SHE HAS REFERRED TO THE PROVISIONS OF SECTION 124 OF THE IT ACT AND SUBMITTED THAT NO PERSON SHALL BE EN TITLED TO CALL IN QUESTION THE JURISDICTION OF AN ASSESSING OFFICER AFTER EXPIRY O F ONE MONTH FROM THE DATE OF NOTICE 5 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. UNDER SECTION 142(1) OF THE IT ACT OR UNDER SECTION 143(2) OF THE ACT OR AFTER THE COMPLETION OF THE ASSESSMENT WHICHEVER IS EARLIER. THE LD. D/R HAS FURTHER CONTENDED THAT THE ASSESSEE HAS NOT DISPUTED THE TE RRITORIAL JURISDICTION OF THE AO WARD 7(2), JAIPUR WHO HAS INITIATED THE PROCEEDINGS AND COMPLETED THE REASSESSMENT UNDER SECTION 147 OF THE IT ACT. SHE HAS RELIED UPON THE FINDINGS OF THE LD. CIT (A) ON THIS ISSUE. 5. THE RIVAL CONTENTIONS AS WELL AS THE RELEVANT MA TERIAL ON RECORD HAVE BEEN CONSIDERED. THERE IS NO DISPUTE AS REGARDS THE ORIG INAL RETURN OF INCOME FILED BY THE ASSESSEE ON 14.08.2007 WITH ITO WARD-1, HANUMANGARH . THE COPY OF THE SAID RETURN IS AVAILABLE AT PAGES 37 & 38 OF THE PAPER B OOK. THE SAID RETURN WAS PROCESSED UNDER SECTION 143(1) ON 20 TH MARCH, 2008 AS PER THE ACKNOWLEDGEMENT AT PAGE 36 OF THE PAPER BOOK. IT IS MANIFEST FROM THE INTIMATION ISSUED UNDER SECTION 143(1) OF THE IT ACT BY THE ITO WARD-1, HANUMANGRH THAT THE PROCESSING IS DONE IN THE COMPUTER SYSTEM OF THE DEPARTMENT. THEREFORE, T HE INFORMATION WAS AVAILABLE IN THE SYSTEM OF THE DEPARTMENT. THE ITO WARD 7(2) JA IPUR ISSUED NOTICE UNDER SECTION 148 ON 26 TH MARCH, 2013 AND HAS SPECIFICALLY STATED IN THE ASS ESSMENT ORDER IN PARA 2 THAT THE ASSESSEE HAS NOT FILED ANY RETUR N OF INCOME IN RESPONSE TO NOTICE UNDER SECTION 148. THEREFORE, MERE APPEARANCE OF T HE A/R OF THE ASSESSEE BEFORE THE AO AND SUBMITTING THE COMPUTATION ALONG WITH TH E REPLY WOULD NOT AMOUNT TO SUBMISSION TO THE JURISDICTION OF THE ITO WARD 7(2) JAIPUR WHEN THE ORIGINAL RETURN OF INCOME WAS ALREADY FILED WITH THE ITO WARD-1 HAN UMANGARH AND WAS ALSO PROCESSED UNDER SECTION 143(1) OF THE IT ACT. THER EFORE, IN THE ABSENCE OF ANY ORDER PASSED UNDER SECTION 127 OF THE IT ACT, THE I TO WARD 7(2) JAIPUR WAS HAVING NO JURISDICTION OVER THE ASSESSEE. THE JURISDICTIO N CANNOT BE ASSUMED BY THE AO 6 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. ONLY ON THE BASIS OF TERRITORIAL AREA BUT THE JURIS DICTION OF THE AO IS CONFERRED ON THE BASIS OF VARIOUS CRITERIA AND ONE OF WHICH IS THE T ERRITORIAL AREA. HOWEVER, THESE CRITERIA AS PROVIDED UNDER SECTION 120 ARE ONLY FOR THE CBDT TO AUTHORIZE ANY INCOME TAX AUTHORITY TO EXERCISE THE POWERS AND PER FORMANCE OF THE FUNCTIONS AS INCOME TAX AUTHORITY. NO INCOME TAX AUTHORITY CAN ASSUME THE JURISDICTION SUO MOTO UNTIL AND UNLESS THE JURISDICTION IS CONFERRED UPON HIM UNDER SECTION 120, 124 AND 127 OF THE IT ACT. THE LD. CIT (A) WHILE REJEC TING THE OBJECTION OF THE ASSESSEE HAS HELD IN PARA 4.3 AS UNDER :- 4.3. I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE, FINDINGS OF THE AO AND SUBMISSION OF THE APPELLANT. THE ASSESSEE CH ALLENGED THE JURISDICTION OF AO. IT IS SEEN FROM RECORDS/REMAND REPORT THAT NO SUCH JURISDICTION WAS MADE DURING THE COURSE OF ASSESSME NT PROCEEDINGS. MOREOVER ASSESSEE PARTICIPATED IN THE ASSESSMENT PR OCEEDINGS WHICH IS FORTIFIED BY FACT THAT ASSESSEE FILED COMPUTATION O F INCOME IN RESPONSE TO NOTICE U/S 148 AND EXPLANATIONS REGARDING THE DE POSITS MADE THEREFORE I FIND NO MERIT IN THE OBJECTION RAISED B Y THE ASSESSEE REGARDING THE OBJECTION TO JURISDICTION OF AO. THUS THE LD. CIT (A) HAS CONSIDERED THE FILING OF C OMPUTATION OF INCOME IN RESPONSE TO NOTICE UNDER SECTION 148 AS SUBMITTING TO THE JU RISDICTION OF THE AO WARD 7(2) JAIPUR IGNORING THE FACT THAT THE AO HIMSELF HAS ST ATED THAT THE ASSESSEE HAS NOT FILED ANY RETURN OF INCOME IN RESPONSE TO NOTICE UN DER SECTION 148 OF THE IT ACT. THEREFORE, THE MERE APPEARANCE BEFORE THE AO IN RES PONSE TO THE NOTICE UNDER SECTION 148 OR 142(1) WOULD NOT AMOUNT TO BESTOWING THE JURISDICTION UPON THE AO WHO WAS OTHERWISE NOT HAVING THE JURISDICTION OVER THE ASSESSEE. THE HONBLE 7 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. BOMBAY HIGH COURT IN CASE OF CIT VS. INCOME TAX SET TLEMENT COMMISSION & OTHERS (SUPRA) HAS HELD IN PARA 11 AND 12 AS UNDER :- 11. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. THE APPLICANTS HAVE STRONGLY CONTENDED BEFORE US THAT IN VIEW OF THE PE TITIONER-REVENUE HAVING PARTICIPATED IN THE PROCEEDINGS BEFORE THE C OMMISSION POST THE IMPUGNED ORDER DATED APRIL 8, 2013, IT AMOUNTS TO WAIVER OF HER RIGHTS TO THE QUESTION THE JURISDICTION OF THE COMM ISSION. WE FIND, IN VIEW OF SECTION 245C(1) OF THE ACT, THE COMMISSI ON CAN EXERCISE JURISDICTION UNDER CHAPTER XIX-A OF THE ACT ONLY WH EN THERE HAS BEEN A TRUE AND FULL DISCLOSURE OF INCOME AND ALSO THE MANNER IN WHICH THE INCOME HAS BEEN DERIVED, BY THE APPLICANT S. THIS IS A CONDITION PRECEDENT FOR THE PURPOSE OF AN APPLICANT INVOKING THE JURISDICTION OF THE COMMISSION AND ALSO FOR THE COM MISSION TO ACT FURTHER ON THE APPLICATION FOR SETTLEMENT. IT IS TH E CASE OF THE PETITIONER THAT THE AFORESAID JURISDICTIONAL REQUIREMENT OF TR UE AND FAIR DISCLOSURE BY THE APPLICANTS HAS NOT BEEN CONSIDERED IN THE IM PUGNED ORDER DATED APRIL 8, 2013, UNDER SECTION 245D(2C) OF THE ACT BU T THE COMMISSION HAS MERELY POSTPONED ITS DECISION ON THE SAME. ONCE IT IS HELD THAT THE ISSUE OF TRUE AND FULL DIS CLOSURE IN THE APPLICATION FOR SETTLEMENT IS A JURISDICTIONAL ISSU E AND IN THE ABSENCE OF ITS SATIS FACTION JURISDICTION CANNOT BE EXERCISED BY THE COMMISSION, IT FOLLOWS THAT MERE PARTICIPATI ON IN THE PROCEEDING BY THE PARTIES CANNOT BY ITSELF BESTOW T HE JURISDICTION ON THE COMMISSION. THE EXERCISE OF JUR ISDICTION BY AN AUTHORITY WHEN NOT SO VESTED IN IT IS OPEN TO CHALLENGE AND PARTICIPATION IN THE PROCEEDING WILL NOT CONFER ANY JURISDICTION AS HELD BY THE APEX COURT IN CARONA LT D. V. PARVATHY SWAMINATHAN AND SONS [2007] 8 SCC 559 AND KANWAR SINGH SAINY V. HIGH COURT OF DELHI [2012] 4 SCC 360. 12. THE NEXT PRELIMINARY CONTENTION URGED ON BEHALF OF THE APPLICANTS IS THAT THE CONDUCT OF THE PETITIONER IN PARTICIPATING IN THE PROCEEDING BEFORE THE COMMISSION AND THE DELAY OF OVER FOUR 8 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. MONTHS IN FILING THIS PETITION AFTER THE PASSING OF THE IMPUGNED ORDER DISENTITLED THE PETITIONER FROM BEING GRANTED ANY RELIEF. A DELAY OF ABOUT FOUR MONTHS IN FILING THE PETITION A FTER THE IMPUGNED ORDER DATED APRIL 8, 2013, IS CERTAINLY NOT FATAL T O ENTERTAINING THE PETITION WHICH IS BASED ON A JURISDICTIONAL CHALLEN GE. THIS IS PARTICULARLY SO AS NO RIGHTS HAVE BEEN ACQUIRED IN THE MEANTIME BY ANY THIRD PARTY. HOWEVER, THE SUBMISSION OF THE APP LICANTS IS THAT THE DELAY ON THE PART OF THE PETITIONER WAS NOT BON A FIDE BUT ONLY DONE TO OBTAIN THE CONFIDENTIAL FOLDERS/ANNEXURES F ILED ALONG WITH THE APPLICATION FOR SETTLEMENT BY LEADING ALL TO BE LIEVE THAT THE IMPUGNED ORDER IS ACCEPTED. BY DELAYING THE CHALLEN GE IN THIS COURT AND OBTAINING INFORMATION/DOCUMENTARY EVIDENCE IN T HE SETTLEMENT PROCEEDINGS ON THE BASIS THAT THE IMPUGNED ORDER IS ACCEPTED IS ONLY WITH A VIEW TO OBTAIN THE CONFIDENTIAL FOLDERS /ANNEXURES TO THE APPLICATION AND USE THEM IN ASSESSMENT PROCEEDINGS BY NOW CHALLENGING THE IMPUGNED ORDER DATED APRIL 8, 2013. THIS INFORMATION CONTAINED IN THE CONFIDENTIAL FOLDERS W OULD NEVER HAVE BEEN MADE AVAILABLE TO THE PETITIONER IN CASE THE A PPLICANTS' APPLICATIONS FOR SETTLEMENT IS HELD INVALID UNDER S ECTION 245D(2C) OF THE ACT. THUS, THE ADJUDICATION PROCEEDING FOR A SSESSMENT BEFORE THE ASSESSING OFFICER AND AUTHORITIES UNDER THE ACT WOULD HAVE BEEN WITHOUT THE EVIDENCE CONTAINED IN THE CON FIDENTIAL FOLDERS OF THE APPLICANTS. THE CONDUCT OF THE PETIT IONER-REVENUE IS UNFAIR AND THE DELAY IN FILING THE PETITION WAS ONL Y TO OBTAIN INFORMATION WHICH IT WOULD NOT HAVE BEEN ENTITLED T O HAD IT NOT ACCEPTED THE IMPUGNED ORDER. IN THE SUBSEQUENT DECISION OF HONBLE BOMBAY HIGH C OURT IN CASE OF M/S. MAVANY BROTHERS VS. CIT (SUPRA) HAS CONSIDERED THIS ISSUE IN PARA 13 AS UNDER :- 9 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. 13. WE HAVE CONSIDERED THE RIVAL CONTENTIONS. THE JURI SDICTION UNDER SECTION 147/148 OF THE ACT IS AN EXTRA ORDINARY JURISDICTIO N AND CAN ONLY BE EXERCISED WHEN CONDITION PRECEDENT AS PROVIDED IN SECTIONS 14 7/148 OF THE ACT ARE SATISFIED. IT IS THE APPELLANT'S CASE THAT THE AFOR ESAID CONDITIONS ARE NOT SATISFIED INASMUCH AS IN THE ABSENCE OF THE ASSESSING OFFICER HAVING THE ORIGINAL RETURN OF INCOME AVAILABLE IT WOULD NOT BE POSSIBLE FOR HI M TO HAVE A REASONABLE BELIEF THAT INCOME CHARGEABLE TO TAX HAS ESCAPED AS SESSMENT. THIS ISSUE OF JURISDICTION ACCORDING TO THE RESPONDENT - REVENUE COULD ONLY HAVE BEEN RAISED BEFORE THE ASSESSING OFFICER AND NOT HAVING BEEN RAISED BEFORE HIM, THE APPELLANT HAD WAIVED ITS RIGHTS TO RAISE THE SAME. THE APPELLANT HAVING SUBMITTED TO THE JURISDICTION OF THE ASSESSING OFFI CER CANNOT NOW CHALLENGE THE SAME. THIS IS NOT ENTIRELY CORRECT. IT IS WELL SETTLED THAT MERE ACQUIESCENCE WILL NOT GIVE JURISDICTION TO AN AUTHORITY WHO HAS NO JURISDICTION. IN FACT THIS COURT IN CIT (CENTRAL) V. ITSC [2014] 365 ITR 68/[2013] 35 TAXMANN.COM 443 HAS HELD THAT MERE PARTICIPATION BY A PARTY IN PRO CEEDINGS WITHOUT JURISDICTION WILL NOT VEST/CONFER JURISDICTION ON T HE AUTHORITY. REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMEN T IS A JURISDICTIONAL FACT AND ONLY ON ITS SATISFACTION DOES THE ASSESSING OFF ICER ACQUIRE JURISDICTION TO ISSUE NOTICE. THUS THIS LACK OF SATISFACTION OF JUR ISDICTIONAL FACT CAN NEVER CONFER JURISDICTION AND AN OBJECTION TO IT CAN BE R AISED AT ANY TIME EVEN IN APPEAL PROCEEDINGS. THE MERE FACT THAT NO OBJECTION IS TAKEN BEFORE THE ASSESSING OFFICER WOULD NOT BY ITSELF BESTOW JURISD ICTION AS THE ASSESSING OFFICER. SUCH AN OBJECTION CAN BE TAKEN IN APPEAL A LSO. MOREOVER, THE APEX COURT IN ITS RECENT DECISION IN KANWAR SINGH SAINI V. HIGH COURT OF DELHI [2012] 4 SCC 307 HAS HELD THAT IT IS SETTLED POSIT ION THAT CONFERMENT OF JURISDICTION IS A LEGISLATIVE FUNCTION AND CANNOT B E CONFERRED BY CONSENT OF PETITIONER. AN ISSUE OF JURISDICTION CAN BE RAISED AT ANY TIME EVEN IN APPEAL OR EXECUTION. RELIANCE IN THIS REGARD COULD USEFULLY B E MADE TO INDIAN BANK V. MANILAL GOVINDJI KHONA [2015] 3 SCC 712. PARAS 22 OF THE SAID JUDGMENT READ AS UNDER : '22. IN SUSHIL KUMAR MEHTA CASE [ SUSHIL KUMAR MEHTA V. GOBIND RAM BOHRA , [1990] 1 SCC 193] THIS COURT HAS ELABORATELY CONS IDERED THE RELEVANT FACTUAL AND LEGAL ASPECT OF THE CASE AND H AS LAID DOWN THE LAW AT PARA 10, AFTER REFERRING TO ITS EARLIER DECISION OF A FOUR-JUDGE BENCH OF THIS COURT SPEAKING THROUGH VENKATARAMA AYYAR, J . IN KIRAN SINGH V. CHAMAN PASWAN [AIR 1954 SC 340 : [1955] 1 SCR 117] , WHICH WOULD BE WORTHWHILE TO BE EXTRACTED AS UNDER: ( SUSHIL KUMAR MEHTA CASE [ SUSHIL KUMAR MEHTA V. GOBIND RAM BOHRA , [1990] 1 SCC 193] , SCC P. 199) 6. '10. ... '6. .... IT IS A FUNDAMENTAL PRINCIPLE WELL ESTABLISHED THAT A DECREE PASSED BY A COURT WITHOUT JURISDICTION IS A NULLITY AND THAT ITS INVALIDITY COULD BE SET UP WHENEVER AND WHEREVER IT IS SOUGHT TO BE ENFORCED OR RELIED UPON, EVEN AT THE STAGE OF EXECU TION AND EVEN IN COLLATERAL PROCEEDINGS. A DEFECT OF JURISDICTION, W HETHER IT IS PECUNIARY OR TERRITORIAL, OR WHETHER IT IS IN RESPECT OF THE SUBJECT-MATTER OF THE ACTION, STRIKES AT THE VERY AUTHORITY OF THE COURT TO PASS ANY DECREE, AND SUCH A DEFECT CANNOT BE CURED EVEN BY CONSENT OF PA RTIES. IF THE QUESTION NOW UNDER CONSIDERATION FELL TO BE DETERMI NED ONLY ON THE 10 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. APPLICATION OF GENERAL PRINCIPLES GOVERNING THE MAT TER, THERE CAN BE NO DOUBT THAT THE DISTRICT COURT OF MONGHYR WAS CORAM NON JUDICE, AND THAT ITS JUDGMENT AND DECREE WOULD BE NULLITIES.' ( KIRAN SINGH CASE [AIR 1954 SC 340 : [1955] 1 SCR 117] , AIR P. 342, PARA 6)' THUS, IT IS OPEN TO THE PETITIONER TO RAISE THE ISS UE OF JURISDICTION BEFORE THE APPELLATE AUTHORITIES. THUS THE HONBLE HIGH COURT HAS HELD THAT MERE PART ICIPATION BY THE PARTY IN THE PROCEEDINGS WITHOUT JURISDICTION WILL NOT BESTOW/CO NFER JURISDICTION ON THE AUTHORITY. IN THE CASE IN HAND, IT IS CLEAR THAT THE ITO WARD 7(2) JAIPUR WAS NOT HAVING JURISDICTION OVER THE ASSESSEE WHEN THE RETURN WAS ALREADY FILED AND PROCESSED BY THE ITO WARD -1 HANUMANGARH. ACCORDINGLY, THE INITI ATION OF PROCEEDINGS UNDER SECTION 147/148 AS WELL AS PASSING THE REASSESSMENT ORDER BY THE ITO WARD 7(2) JAIPUR IS BAD IN LAW FOR WANT OF JURISDICTION AND T HUS THE IMPUGNED ORDER IS QUASHED. 6. SINCE THE IMPUGNED REASSESSMENT ORDER IS QUASHED FOR WANT OF JURISDICTION, THEREFORE, I DO NOT PROPOSE TO GO INTO THE OTHER IS SUES RAISED BY THE ASSESSEE IN RESPECT OF THE ADDITIONS MADE BY THE AO. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 17/09/20 19. SD/- ( FOT; IKY JKWO (VIJAY PAL RAO) U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 17/09/2019. DAS/ 11 ITA NO. 51/JP/2017 SHRI BHAGWAN SAHAI, JAIPUR. VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- SHRI BHAGWAN SAHAI, JAIPUR. 2. THE RESPONDENT THE ITO WARD 7(2), JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 51/JP/2017) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR