SHAH DILIP SANKARCHAND,AHMEDABAD V. ACIT, CIRCLE 1(3), AHMEDABAD, AHMEDABAD

ITA 346/AHD/2025

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The case involves Shah Dilip Sankarchand, the appellant, contesting an assessment order for the Assessment Year 2017-18 issued by the Deputy Commissioner of Income Tax, Circle 1(3), Ahmedabad. The appellant argued that the assessment was invalid as the notice under section 143(2) of the Income Tax Act was issued by a non-jurisdictional officer, specifically the Income Tax Officer, Ward 1(3)(4), Ahmedabad, who lacked the competent jurisdiction to do so. The Learned Commissioner of Income Tax (Appeals) did not address these legal grounds and instead remanded the case for a de novo assessment. The Tribunal found that the CIT(A) should have adjudicated the legal issues concerning the jurisdiction and the validity of the assessment order before remanding the case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 717111 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2017-2018
• Appeal Filed On: 13-02-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RIGNESH DAS
• Assessee Lawyers: MEHUL K. PATEL; P. D. SHAH
• Keywords: Set aside
• Section: 144

Judgement Text

" आयकर अपीलीय अिधकरण, अहमदाबाद \u0011ायपीठ “ए“,अहमदाबाद । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD \u0016ी संजय गग\u001b, \u0011ाियक सद एवं \u0016ी मकरंद वसंत महादेवकर, लेखा सद क े सम!। ] ] Before Shri Sanjay Garg, Judicial Member And Shri Makarand V. Mahadeokar, Accountant Member आयकर अपील सं /ITA No.346/Ahd/2025 िनधा \u000fरण वष\u000f /Assessment Year : 2017-18 Shah Dilip Sankarchand 1208-A/2, First Floor Virchand Deepchand ni Haveli Road Madangopal Haveli Road Manekchowk Ahmedabad 380 001 (Gujarat) बनाम/ v/s. The ACIT Circle-1(3) Ahmedabad – 380 015 \u0013थायी लेखा सं./PAN: AAFHS 5333 H (अपीलाथ$/ Appellant) (%& यथ$/ Respondent) Assessee by : Shri Mehul K. Patel, Advocate & Shri P. D. Shah, AR Revenue by : Shri Rignesh Das, CIT-DR सुनवाई की तारीख/Date of Hearing : 19/08/2025 घोषणा की तारीख /Date of Pronouncement: 22/08/2025 आदेश/O R D E R Per Sanjay Garg, Judicial Member: The present appeal has been preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘CIT(A)’] dated 30/12/2024 passed u/s.250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for the Assessment Year (AY) 2017-2018. 2. The assessee has raised the following grounds of appeal: Printed from counselvise.com ITA No.346/Ahd/2025 Shah Dilip Sankarchand vs. ACIT 1(3) Asst.Year : 2017-18 2 “1. That the learned National Faceless Appeal Centre has erred in law and facts by not quashing the assessment order as notice under section 143(2) of the Act has been issued by Non-Jurisdictional Assessing Officer viz Income Tax Officer, Ward 1(3)(4), Ahmedabad, and the finally, on account of non-participation during the entire assessment proceeding, the learned Dy. CIT, Circle 1(3), Ahmedabad, has passed the assessment order under section 144 of the Act, and in view of the said fact and settled law, the order passed by the learned AO is bad in law and therefore required to be quashed and accordingly the learned AO be directed. 2. The Learned National Faceless Appeal Centre has erred in facts and in law, by directing the leaned AO to make fresh assessment and therefore the learned AO should be directed to accept the returned income. 3. That your appellant craves a leave to add, alter or amend any grounds at the time of hearing.” 3. At the outset, the Ld.Counsel for the assessee has invited our attention to the impugned order of the Ld.CIT(A) and has submitted that the Ld.CIT(A) observing that the impugned assessment order of the Assessing Officer (AO) was an ex-parte/ best judgement assessment order passed u/s.144 of the Act, has restored the matter for assessment afresh to the file of the AO. That he, however, has not adjudicated the legal grounds taken by the assessee before the Ld.CIT(A). The Ld.Counsel, in this respect, has submitted that the assessee has challenged the very jurisdiction of the AO to frame the impugned assessment on the ground that the mandatory notice u/s.143(2) of the Act, was not issued by the jurisdictional AO. It was submitted that the returned income, for the year under consideration, of the assessee being more than Rs.25 lakhs, the pecuniary jurisdiction to frame the assessment lied with the Dy.Commissioner of Income Tax. However, a notice u/s.143(2) of the Act, was issued by the Income Tax Officer, Ward-1(3)(4), Ahmedabad, which did not have the jurisdiction to do so in the case of assessee. The Ld.Counsel has submitted that the Ld.CIT(A) has failed to decide the above legal grounds taken before him, which hit at the very validity of the assessment order being passed without issuance of notice u/s.143(2) of the Act by the AO having competent jurisdiction. The Ld.Counsel, therefore, has submitted that the Printed from counselvise.com ITA No.346/Ahd/2025 Shah Dilip Sankarchand vs. ACIT 1(3) Asst.Year : 2017-18 3 matter may be restored to the file of the Ld.CIT(A) to decide the legal issues take by the assessee before him. 4. The Ld.Departmental Representative (DR), however, has relied upon the finding of the Ld.CIT(A). 5. We have considered the rival submissions. It is settled law that the legal issue contesting the very validity of the assessment order or hitting at the jurisdiction of the AO to frame assessment can be taken at the appellate stage. The Ld.CIT(A), in our view, was supposed to adjudicate the legal issues raised before him, but he has remanded the matter to the file of the AO for de novo assessment without adjudicating the legal issues. If the concerned AO has no jurisdiction, the assessment order passed by him will not be a valid order for want of issue of notice u/s.143(2) of the Act. Under the circumstances, no useful purpose will be served in restoring the matter to the file of the AO. Hence, the impugned order of the ld.CIT(A) is set aside and the matter is restored to the file of ld.CIT(A) with a direction to adjudicate on the legal issues raised by the assessee before him and, thereafter, to decide the appeal of the assessee in accordance with law. 6. In the result, appeal of the assessee is treated as allowed for statistical purposes. Order pronounced in the Open Court on 22/08/2025. Sd/- Sd/- (Makarand V. Mahadeokar) Accountant Member ( Sanjay Garg ) Judicial Member अहमदाबाद/Ahmedabad, िदनांक/Dated 22/08/2025 टी.सी.नायर, व.िन.स./T.C. NAIR, Sr. PS Printed from counselvise.com ITA No.346/Ahd/2025 Shah Dilip Sankarchand vs. ACIT 1(3) Asst.Year : 2017-18 4 आदेश की #ितिलिप अ$ेिषत/Copy of the Order forwarded to : 1. अपीलाथ% / The Appellant 2. #&थ% / The Respondent. 3. संबंिधत आयकर आयु' / Concerned CIT 4. आयकर आयु' ) अपील ( / The CIT(A)- (NFAC), Delhi 5. िवभागीय #ितिनिध , अिधकरण अपीलीय आयकर , अहमदाबाद /DR,ITAT, Ahmedabad. 6. गाड\u000f फाईल / Guard file. आदेशानुसार/ BY ORDER, स&ािपत #ित //True Copy// सहायक पंजीकार (Asstt. Registrar) आयकर अपीलीय अिधकरण, ITAT, Ahmedabad 1. Date of dictation (dictation pad is attached with the file)) : 19.8.2025 2. Date on which the typed draft is placed before the Dictating Member. : 19.8.2025 3. Date on which the approved draft comes to the Sr.P.S./P.S : 4. Date on which the fair order is placed before the Dictating Member for pronouncement. : 5. Date on which fair order placed before Other Member : 6. Date on which the fair order comes back to the Sr.P.S./P.S. : 22.8.2025 7. Date on which the file goes to the Bench Clerk. : 22.8.2025 8. Date on which the file goes to the Head Clerk. : 9. The date on which the file goes to the Assistant Registrar for signature on the order. : 10. Date of Despatch of the Order : Printed from counselvise.com "