SMT. INDUBALA JAYANT JAIN ,MUMBAI V. I.T.O WARD, 17(2)(1), MUMBAI

ITA 4953/MUM/2024

AI Insights

The case involves Smt. Indubala Jayant Jain, who appealed against the order of the National Faceless Appeal Centre (NFAC), Delhi, which upheld the assessment order passed by the Income Tax Officer (ITO) under sections 143(3) r.w.s. 147 of the Income Tax Act, 1961. The primary contention was the validity of the notice issued under section 148, which was challenged on the grounds of lack of territorial jurisdiction. The tribunal found that the notice was issued by an officer who did not have the territorial jurisdiction over the assessee's case, rendering the notice and subsequent assessment void ab initio.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 788516 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: misc
• Appeal Filed On: 25-09-2024
• Other Referred Cases: National Thermal Power Co. Ltd. v. CIT [1998] 97 Taxman 358 (SC), Ashok Devichand Jain v. Union of India [2023] 151 taxmann.com 70 (Bom.)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIRABHADRA MAHAJAN
• Assessee Lawyers: G.P. MEHTA
• Keywords: Set aside
• Section: 148; 143(3)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “C”, MUMBAI BEFORE SHRI. VIKRAM SINGH YADAV, ACCOUNTANT MEMBER AND SHRI. ANIKESH BANERJEE, JUDICIAL MEMBER I.T.A No. 4953/MUM/2024 (Assessment Year: 2010-11) Smt. Indubala Jayant Jain C/o. G.P.Mehta & Co. CAS, 807, Tulsiani Chambers, Nariman Point, Mumbai- 400 021 PAN: AADPJ7545C vs ITO – 17(2)(1), Mumbai. Kautilya Bhawan, IInd Floor, BKC, Bandra- (East), Mumbai APPELLANT RESPONDENT Assessee by : Shri G. P. Mehta, CA Respondent by : Shri Virabhadra Mahajan, (SR.DR.) Date of hearing : 12/11/2025 Date of pronouncement : 24 /11/2025 O R D E R Per: Shri Anikesh Banerjee (JM): The instant appeal of the assessee filed against the order of the National Faceless Appeal Centre (NFAC), Delhi [for brevity, ‘Ld.CIT(A)’] passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’) for assessment year 2010-11, date of order 31/07/2024. The impugned order was emanated from the order Ld. Income Tax Officer ward 17(2)(1), Mumbai order passed u/s. 143(3) r.w.s. 147 of the Act, date of order 30/12/2017. Printed from counselvise.com 2 ITA No.4953/Mum/2024 Smt. Indubala Jayant Jain 2. The brief facts of the case are that the assessee had filed the return of income on 28.07.2010 declaring its total income of Rs. 14,15,680/- and the return was proceed u/s 143(1) by the Jurisdictional Ld.AO, ITO ward 15(2)(4), Mumbai. The copy of the return and the intimation u/s 143(1) is annexed in ABP page 12 and 13. After receiving the information from AST system of the Income Tax Department. The assessee’s case was reopened u/s 148 by a notice dated 30.03.2017. The assessee primarily filed the letter and requested to accept the 139 return as return u/s 148 of the Act and also the assessee challenged the jurisdiction of the Ld.AO related to issuance of notice u/s 148 of the Act. The copy of the notices u/s 148 dated 30.03.2017 is reproduced as below: Printed from counselvise.com 3 ITA No.4953/Mum/2024 Smt. Indubala Jayant Jain 3. The letter submitted by the assessee on dated 11.04.2017 by challenging the jurisdiction of Ld.AO was duly filed before the department on 03.05.2017 is reproduced as under:- Printed from counselvise.com 4 ITA No.4953/Mum/2024 Smt. Indubala Jayant Jain 4. But Ld.AO completed the assessment after addition in different heads total amounting to Rs. 1,01,50,838/-. Aggrieved assessee, filed an appeal before the Ld. CIT(A). But Ld. CIT(A) upheld the impugned order and rejected the appeal of the assessee. Being aggrieved the assessee filed an appeal before us. 5. The Ld.AR filed a paper book containing page 1 – 44 which is kept in record. The Ld.AR further submitted that the assessee u/s 255(5) in Income Tax Appellate Rule and Regulation, 1963 filed the additional ground related to challenging the jurisdictional of the Ld.AO for assessment and for issuance of notice u/s 148 of the Act. The relevant additional grounds are reproduce as below: “01. The notice issued u/s 148 of the I. T. Act, 1961 is ab-initio void, inasmuch as, said notice was not issued by the Officer having territorial jurisdiction over appellant's case. Consequently, assessment order passed in furtherance of said notice is also ab-initio void, inasmuch as, there is an inherent defect in assumption of jurisdiction. 02. The learned Assessing Officer has grossly erred in not disposing off appellant's objection to jurisdiction in contradiction with the statutory provisions.” 6. The Ld.AR further argued that the assessee filed the return though in recorded reasons the Ld.AO treated the assessee as non-filer. So there is a basic wrong assumption by Ld.AO in recorded reasons. He further invited our attention in APB page 12 and 13 that the assessee’s case was in jurisdictional of income tax officer ward 15(2)(4), Mumbai. Whereas the notice was duly issued by the ITO ward 17(2)(1), Mumbai. After the objection was duly filed before the Ld.AO within one month that is on 11.04.2017, without disposing the same assessment was Printed from counselvise.com 5 ITA No.4953/Mum/2024 Smt. Indubala Jayant Jain completed. Ld.AO violated the jurisdiction u/s 124 of the Act. So, accordingly the entire assessment is bad in law. 7. The Ld. DR argued and relied on the orders of the revenue authorities. 8. We have heard the rival submissions and perused the documents available on record. We note that the notice under section 148 of the Act was issued by ITO, Ward 17(2)(1), Mumbai on 30.03.2017. The assessee filed objections on 11.04.2017, which were received by the Ld. AO on 03.05.2017. However, without disposing of the assessee’s objections, the Ld. AO proceeded to pass the impugned assessment order. The assessee has raised an additional ground before this Bench, which is purely a legal ground. Reliance has been placed on the judgment of the Hon’ble Supreme Court in National Thermal Power Co. Ltd. v. CIT [1998] 97 Taxman 358 (SC). In light of the said judgment, the assessee is entitled to raise the legal ground at this stage, and therefore, we proceed to adjudicate the same first. Upon careful consideration, we find merit in the contention that the Ld. AO lacked territorial jurisdiction over the assessee at the time of issuing the notice under section 148. Any assessment order passed in contravention of section 124 of the Act is void ab initio. Our view is fortified by the decision of the Hon’ble Bombay High Court in Ashok Devichand Jain v. Union of India [2023] 151 taxmann.com 70 (Bom.), wherein it was held that a notice issued under section 148 by a non-jurisdictional officer has no validity in the eyes of law and is liable to be set aside. Printed from counselvise.com 6 ITA No.4953/Mum/2024 Smt. Indubala Jayant Jain The Ld. DR has not refuted the submissions of the Ld. AR. Further, the Ld. AO failed to dispose of the objections raised by the assessee regarding the lack of jurisdiction, which also vitiates the assessment proceedings. Respectfully following the binding precedent of the Hon’ble Bombay High Court, we hold that the notice issued under section 148 by a non-jurisdictional Assessing Officer is invalid, and consequently, the assessment order passed pursuant thereto is bad in law. The demand raised, amounting to Rs.1,01,50,838/-, is accordingly quashed. 9. As we have allowed the appeal of the assessee on the basis of the additional legal ground, the remaining grounds are rendered academic in nature and are left open. 10. In the result, the appeal of the assessee bearing ITA No.4953/MUM/2024, is allowed. Order pronounced in the open court on 24th November 2025 Sd/- sd/- (VIKRAM SINGH YADAV) (ANIKESH BANERJEE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai,िदनांक/Dated: 24/11/2025 Disha Raut, Stenographer Printed from counselvise.com 7 ITA No.4953/Mum/2024 Smt. Indubala Jayant Jain Copy of the Order forwarded to: 1. अपीलाथ /The Appellant , 2. ितवादी/ The Respondent. 3. आयकरआयु\u0014 CIT 4. िवभागीय ितिनिध, आय.अपी.अिध.,मुंबई/DR, ITAT, MUMBAI 5. गाड\u0019फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar), ITAT, MUMBAI Printed from counselvise.com "