SURAJ DUROBUILD (P) LTD,NEW DELHI V. ACIT CIORCLE-24(2), NEW DELHI

ITA 777/DEL/2024

AI Insights

The case involves M/s Suraj Durobuild Pvt Ltd, the appellant, contesting the jurisdiction of the DCIT in issuing notices and conducting assessments for the assessment year 2012-13. The primary contention was that the pecuniary jurisdiction for the case, given the income reported, should have remained with the ITO, not the DCIT, as the income was below the threshold of Rs. 30 lakhs set for metro cities. The Tribunal examined the procedural validity of the jurisdiction assumed by the DCIT and found it lacking due to the absence of a necessary transfer order under section 127 of the Income Tax Act.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 716649 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2012-2013
• Appeal Filed On: 20-02-2024
• Other Referred Cases: Ashok Devichand Jain Vs. UOI, M/s Boutique International Pvt. Ltd., Vs. ITO, YKM Holding vs ACIT, M/s Monarch & Qureshi Builders Vs. ACIT, Sharda Export-A.Y.06-07, Shyam Sunder Khandelwal Vs ACIT, Abhishek Jain V ITO, Advantage Strategic Consultancy P Ltd, Ravneet Takhar V CIT
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH GUPTA
• Assessee Lawyers: RAJ KUMAR
• Section: 148; 143(3); 139

Judgement Text

"Page 1 of 6 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘G’ BENCH, NEW DELHI BEFORE MS. MADHUMITA ROY, JUDICIAL MEMBER, AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA No. 777/DEL/2024 [A.Y. 2012-13] M/s Suraj Durobuild Pvt Ltd Vs. The A.C.I.T. 3618-XI, Netaji Subash Marg Circle – 24(1) Darya Ganj, New Delhi New Delhi PAN – AALCS 6344 M (Applicant) (Respondent) Assessee By : Shri Raj Kumar, CA Shri Suraj Gupta, Adv Department By : Shri Manish Gupta, Sr. DR Date of Hearing : 13.08.2025 Date of Pronouncement : 22.08.2025 ORDER PER NAVEEN CHANDRA, A.M:- This appeal by the assessee is preferred against the order of the NFAC, Delhi dated 20.12.2023 for A.Y 2012-13. 2. The assessee ‘s main argument is that the assumption of pecuniary jurisdiction is illegal and bad in law as the returned income was less than Printed from counselvise.com ITA No. 777/DEL/2024 [A.Y. 2012-13] M/s Suraj Durobuild Pvt Ltd Page 2 of 6 Rs. 30 lakhs and notice was issued and assessment framed u/s 148 of the Act by the DCIT/ACIT which is not sustainable in the eyes of law. 3. At the very outset of the opening of the arguments, the ld. counsel for the assessee submitted that as per CBDT Instructions No. 1 of 2011 dated 31.01.2011, jurisdiction for assessment vested with the Income tax Officer upto Rs. 20 lakhs and where income declared returned by a non-corporate assessee was above Rs. 20 lakhs, the pecuniary jurisdiction would be of DC/AC. Since the declared income in this case is above Rs. 30 lakhs, the assumption of jurisdiction is invalid and hence the whole proceedings are illegal and unsustainable in law. The ld. counsel for the assessee relied upon the following judgements in support of his contentions: 1.Ashok Devichand Jain Vs. UOI 452 ITR 43 (Bom.) [2023] 2.M/s Boutique International Pvt. Ltd., Vs. ITO In ITA No. 831/DEL/2017 3.YKM Holding vs ACIT ITA No. ITA No. 1020/Del/2019 Dtd. 29.04.24 4.M/s Monarch & Qureshi Builders Vs. ACIT ITA No.2026/Mum/2023 Dtd.21.12.23 5.Sharda Export-A.Y.06-07 ITA No. 39/DDN/2022 Dtd. 15.09.23 6.Shyam Sunder Khandelwal Vs ACIT 161 Taxmann.com 255 (Raj) 4. Per contra, the ld. DR relied upon the orders of the authorities below. The ld DR relied on the decision of the following: 1.Abhishek Jain V ITO (2018) 94 taxmann.com 355(Del) 2.Advantage Strategic Consultancy P Ltd (2021)124taxmann.com 511(Mad) 3.Ravneet Takhar V CIT (2017) 84 taxmann.com 299(SC) Printed from counselvise.com ITA No. 777/DEL/2024 [A.Y. 2012-13] M/s Suraj Durobuild Pvt Ltd Page 3 of 6 5. We have heard the rival submissions and have perused the relevant material on record. We find that Income tax return for AY 2012-13 was filed on 30.09.2012 u/s 139 of the Act at Rs. 10,71,331/- which is less than Rs. 30 lakhs. As per the Instruction no 1/2011, the correct pecuniary jurisdiction of cases of Return below 20 lakh in Mofussail areas and Rs 30 lakh in Metro cities, lies with the ITO. We find that the notices u/s 148 dated 10.10.2014 was issued by DCIT Cir.9(1), New Delhi and the notice u/s 148 dated 13.05.2015 were issued by the DCIT Cir. 24(2), New Delhi. The reasons recorded for reopening is recorded by the DCIT Cir.9(1), New Delhi and the assessment u/s 143(3) r.w.147 is made by DCI Cir 24(2), New Delhi. The ld AR had stated that on a query raised under RTI Act to PIO, ITO Ward 24(1), Delhi with regard to any order being issued for transferring the jurisdiction from the ITO or DCIT Cir 9(1) to DCIT Cir. 24(2), New Delhi, it was found that no order u/s 127 was available on the file. 6. On a query from the Bench, the ld DR produced an explanation from the AO that a subsequent circular dated 08.04.2011, the CIT was empowered to adjust the monetary limit depending on the work load. The AO further explained that the jurisdiction as per the alphabetical name of the assessee vests with the Cir 24(2). The ld DR however, could controvert that there does not exist any order u/s 127 for transferring Printed from counselvise.com ITA No. 777/DEL/2024 [A.Y. 2012-13] M/s Suraj Durobuild Pvt Ltd Page 4 of 6 the file from an ITO, with whom the pecuniary jurisdiction lies, to the DCIT Cir 9(1) or DCIT Cir 24(2). 7. We have been told about the subsequent Instruction no 6/2011 dated 8.4.2011 empowering the CIT to adjust the monetary limit for the ITO/DCITs. The ld AR, however submitted that the said Instruction does allow monetary adjustment but the same is limited to adjust the limits by an amount of 5 lakh and since the assessee’s return was only of Rs 10 lakh, even after the said Instruction is applied, the pecuniary jurisdiction would not change from ITO to DCIT. We also find that the neither the AO nor the Ld DR could controvert the fact that no order u/s 127 was passed for transferring the jurisdiction from ITO to the DCIT. In the above factual matrix, we are of the considered opinion that the notice u/s 148 of the Act as well as the assessment, which has been issued/completed by the DCIT, has been done without assuming proper jurisdiction by way of any order u/s 127 of the Act. Accordingly, there is no valid jurisdictional notice u/s 148 which makes the whole proceedings illegal, unsustainable in law and void ab initio. We are fortified in our view by the Hon’ble Bombay High Court in the case of Ashok Devichand Jain Vs. UOI (supra) which dealt with an identical facts. Ground no 2 raised on this count is allowed. Printed from counselvise.com ITA No. 777/DEL/2024 [A.Y. 2012-13] M/s Suraj Durobuild Pvt Ltd Page 5 of 6 6. Since we have held the assessment proceedings to be void ab initio, we do not dwell into the merits of the case. 7. In the result, the appeal of the assessee in ITA No. 777/DEL/2024 is allowed. The order is pronounced in the open court on 22.08.2025. Sd/- Sd/- [MADHUMITA ROY] [NAVEEN CHANDRA] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 22nd AUGUST, 2025. VL/ Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) Asst. Registrar, 5. DR ITAT, New Delhi Printed from counselvise.com ITA No. 777/DEL/2024 [A.Y. 2012-13] M/s Suraj Durobuild Pvt Ltd Page 6 of 6 Sl No. PARTICULARS DATES 1. Date of dictation of Tribunal Order . 2. Date on which the typed draft Tribunal Order is placed before the Dictation Member 3. Date on which the typed draft Tribunal Order is placed before the other Member 4. Date on which the approved draft Tribunal Order comes to the Sr. P.S./P.S. 5. Date on which the fair Tribunal Order is placed before the Dictating Member for pronouncement 6. Date on which the signed order comes back to the Sr. P.S./P.S 7. Date on which the final Tribunal Order is uploaded by the Sr. P.S./P.S. on official website 8. Date on which the file goes to the Bench Clerk alongwith Tribunal Order 9. Date of killing off the disposed of files on the judiSIS portal of ITAT by the Bench Clerks 10. Date on which the file goes to the Supervisor (Judicial) 11. The date on which the file goes for xerox 12. The date on which the file goes for endorsement 13. The date on which the file goes to the Superintendent for checking 14. The date on which the file goes to the Assistant Registrar for signature on the Tribunal order 15. Date on which the file goes to the dispatch section 16. Date of Dispatch of the Order Printed from counselvise.com "