VINOD KUMAR GIRI,HOWRAH V. ITO, WARD 47(1), , KOLKATA

ITA 716/KOL/2025

AI Insights

The case involves Vinod Kumar Giri, the appellant, who contested an assessment order for the Assessment Year 2018-2019. The Income Tax Officer (ITO), Ward-47(1), Kolkata, issued a notice under section 148 of the Income Tax Act, which led to a reassessment declaring an unexplained credit of Rs. 92,95,020 under section 68. The appellant challenged the jurisdiction of the ITO and the validity of the notice, citing CBDT Instruction No. 1/2011 and various judicial precedents. The Income Tax Appellate Tribunal (ITAT) found that the ITO lacked jurisdiction as per the monetary limits set for assigning cases, leading to the quashing of the assessment order.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 717493 (ITAT-KOLKATA)
• Duration Of Justice: 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2018-2019
• Appeal Filed On: 07-04-2025
• Other Referred Cases: Ashok Devichand Jain-vs.- Union of India, Hirak Sarkar -vs.- ACIT, PCIT -vs.- Shree Shoppers Ltd., M/s. J.R. Road Lines Pvt. Ltd. vs. DCIT, Bhartiya International Ltd., New Delhi-vs.-DCIT, CIT -vs.-Tejua Rohitkumar, PCIT-vs.- Rohit Baid, Rohit Baid -vs.- ITO, C. Krishnan -vs.- ITO
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Question of law; Unexplained cash credit; Competent authority; Procedural lapse
• Section: 147; 148; 143(3); 142(1); 68; 260A

Judgement Text

" ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 1 IN THE INCOME TAX APPELLATE TRIBUNAL, ‘D’ BENCH, KOLKATA Before Shri Rajesh Kumar, Accountant Member & Shri Pradip Kumar Choubey, Judicial Member I.T.A. No. 716/KOL/2025 Assessment Year: 2018-2019 Vinod Kumar Giri,…………………….…………..Appellant 158/2/1, Belilious Road, Kadamtala, Howrah-711101, West Bengal [PAN:ADXPG2995E] -Vs.- Income Tax Officer,…………………………......Respondent Ward-47(1), Kolkata, 3, Government Place (West), Kolkata-700001 Appearances by: Shri Vikash Surana, A.R., appeared on behalf of the assessee Shri S.B. Chakraborthy, Sr. D.R., appeared on behalf of the Revenue Date of concluding the hearing: July 30, 2025 Date of pronouncing the order: August 11, 2025 O R D E R Per Pradip Kumar Choubey, Judicial Member:- The present appeal is directed at the instance of assessee against the order of Id. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 13.02.2025 passed for Assessment Year 2018-2019. Printed from counselvise.com ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 2 2. Brief facts of the case are that the assessee being an individual filed his return of income for the A.Y.-2018-19 declaring total income at Rs.30,88,650/-. The ld. Assessing Officer on receiving information from the DDIT(Inv.), Kolkata initiated the proceeding under section 148A of the Income Tax Act and asked response from the assessee. In absence of reply from the assessee, the case was reopened. A notice under section 148 of the Income Tax Act was issued and in response to the same, the assessee filed income tax return disclosing total income at Rs.30,88,650/-. The assessee has also filed copy of Bank statements, challans and ledger copy of purchase from M/s. Sumangal Steel Strip Marketing Pvt. Ltd., confirmations from the said vendor, etc., but the ld. Assessing Officer after considering the same, vide its order dated 20.03.2023, passed order under section 147 of the Income Tax Act and declared an amount of Rs.92,95,020/- as unexplained credit under section 68 of the Income Tax Act. 3. Aggrieved by the order of the ld. Assessing Officer, the assessee preferred an appeal before the ld. CIT(Appeals), wherein the appeal of the assessee has been dismissed, as inspite of providing sufficient opportunity, the assessee did not file any response. 4. Being aggrieved and not being satisfied with the order of ld. CIT(Appeals), the assessee preferred an appeal before us. 5. The ld. A.R. of the assessee challenges the very impugned order by taking legal grounds that the assessment order is bad in Printed from counselvise.com ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 3 law for the reason that the ld. Assessing Officer having no jurisdiction over the assessee, in fact, not issued notice under section 148 of the Act. The ld. A.R. further challenges that as per the CBDT Instruction, monetary limits for assigning cases being non-corporate assessee, have been fixed, but in the present case, notice under section 148 of the Act has been issued by the ITO, Ward-47(1), though he has got no jurisdiction to issue the notice. The ld. A.R. further submits that the assessee has filed the Income Tax Return acknowledgment to establish that the total income was Rs.30,88,650/- and also brought the attention of the Court regarding the CBDT Instruction No. 1/2011 and CBDT Notification No. 15/2020. He has also placed reliance over the following decision of the Court:- (i) Ashok Devichand Jain-vs.- Union of India Bombay High Court (ii) Hirak Sarkar -vs.- ACIT ITAT, ‘SMC’ Bench, Kolkata (iii) PCIT -vs.- Shree Shoppers Ltd. Calcutta High Court (iv) M/s. J.R. Road Lines Pvt. Ltd. ITAT, ‘C’ Bench, Kolkata (v) Bhartiya International Ltd., New Delhi-vs.-DCIT ITAT, ‘I’ Bench, Delhi (vi) CIT -vs.-Tejua Rohitkumar Gujrat High Court (vii) PCIT-vs.- Rohit Baid Calcutta High Court (viii) Rohit Baid -vs.- ITO ITAT, ‘B’ Bench, Kolkata 6. The ld. Departmental Representative supports the impugned order of ld. CIT(Appeals) and he has also cited the decision passed by the Hon’ble High Court of Judicature at Madras in the case of C. Krishnan -vs.- ITO passed on 27th November, 2014. Printed from counselvise.com ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 4 7. Upon hearing the submissions of the ld. Counsel of the respective parties, we have perused the grounds taken by the assessee and also perused the documents filed by the assessee. We admit that no doubt, notice under section 148 of the Act was issued by ITO, Ward-47(1), Kolkata. On perusal of the ITR acknowledgment in A.Y. 2018-19, there is no denial of the fact that total income was declared at Rs.30,88,650/-. The ld. A.R. brought the attention of the Bench over the CBDT Instruction No. 1/2011, which is as under:- Section 119 of the Income-tax Act, 1961 - Instructions to subordinate authorities - Instructions regarding income limits for assigning cases to Deputy Commissioners/Assistant Commissioners/ITOs. INSTRUCTION NO. 1/2011 |F. NO. 187/12/2010-IT(A-I)], DATED 31-1-2011 References have been received by the Board from a large number of taxpayers, especially from mofussil areas, that the existing monetary limits for assigning cases to ITOs and DCs/ACs is causing hardship to the taxpayers, as it results in transfer of their cases to a DC/AC who is located in a different station, which increases their cost of compliance. The Board had considered the matter and is of the opinion that the existing limits need to be revised to remove the abovementioned hardship. An increase in the monetary limits is also considered desirable in view of the increase in the scale of trade and industry since 2001, when the present income limits were introduced. It has therefore been decided to increase the monetary limits as under: Income declared (Mofussil areas) Income declared (Metro cities) ITOs Acs/DCs ITOs DCs/ACs Corporate returns Upto Rs.20 lacs Above Rs.20 lacs Upto Rs.30 lacs Above Rs.30 lacs Non- Corporate returns Upto Rs.15 lacs Above Rs.15 lacs Upto Rs.20 lacs Above Rs.20 lacs 8. We hard heard both the sides and perused the order passed by the ITAT, Kolkata in the case of Rohit Baid -vs.- ITO, Ward- 36(1), Kolkata cited by the ld. A.R. We find that the issue of the Printed from counselvise.com ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 5 present case and the issue of above cited decisions are the same. It is important to mention here that the order passed by the ITAT, Kolkata in Rohit Baid’s case has been challenged by the Revenue in the Calcutta High Court and the Hon’ble Calcutta High Court in the recent decision passed on 6th May, 2025, as cited by the ld. A.R., has confirmed the order passed by the ITAT by dismissing the appeal of the Revenue. Since the issues are the same, hence we have gone through the order passed by the ITAT, Kolkata in the case of Rohit Baid and it is important to quote the relevant paragraph of the order, which is as under:- “3. Though the assessee through its grounds of appeal has agitated the confirmation of the impugned additions made by the Assessing Officer both on legal grounds as well as factual merit, however, the Id. counsel has firstly raised the legal issue relating to the pecuniary jurisdiction of the concerned Assessing Officer who issued notice u/s 148 of the Income Tax Act to assume jurisdiction to reopen the assessment u/s 147 of the Act. The Id. counsel in this respect has invited our attention to the copy of notice dated 31.03.2021 issued u/s 148 of the Act to submit that the same has been issued by ITO, Ward- 36(1), Kolkata. He has further invited our attention to the copy of the ITR acknowledgement for assessment year 2015-16 to show that the assessee had returned total income of Rs.17960490/-. The Id. counsel has further referred to the provisions of section 120 of the Act r.w. CBDT Instruction No.1/2011 [F.No.187/12/2O1O-IT(A-I), Dated 31.01.2011 to submit that as per the relevant statutory provisions not only the Assessment Year: 2015-16 Rohit Baid territorial jurisdiction but also the pecuniary jurisdiction of the Income Tax Officers/Assessing Officer has been fixed by the CBDT and that if the returned income is less than Rs.20 lakhs for non-corporate assessees, the jurisdiction to frame to assessment lies to the Income Tax Officer, whereas, if the returned income is more than Rs.20 lakhs, the jurisdiction lies with the concerned ACIT/DCIT. He has submitted that in this case, the notice u/s 148 has been issued by ITO, Ward-36(1), Kolkata, whereas, the jurisdiction to issue the notice u/s 148 lied with concerned ACIT/DCIT. He has further submitted to assume jurisdiction to reopen the assessment u/s 147 of the Act, a valid notice u/s 148 of the Act was required to be issued by the competent authority/Assessing Officer having Printed from counselvise.com ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 6 jurisdiction over the assessee. The Id. counsel has submitted that the notice u/s 148 of the Act has not been issued to the assessee by the Assessing Officer having pecuniary jurisdiction over the assessee. He, therefore, has submitted that the reopening of the assessment by non-jurisdictional officer was bad in law. The Id. Counsel has submitted that the issue is squarely covered by the recent decision of the jurisdictional Hon'ble Calcutta High Court in the case of PCIT vs. Shree Shoppers Ltd. in ITAT/39/2023 in LA N0.GA/1/2023 dated 15.03.2023. The Id. Counsel for the assessee has further relied on the decision of the Coordinate 'C' Bench of the Tribunal in the case of M/s J R Roadlines Pvt. Ltd. vs. DCIT in ITA N0.2534/K0I/2019 order dated 27.05.2022. 9. We have also gone through the order dated 6th May, 2025 passed by the Hon’ble High Court at Calcutta in the case of Principal Commissioner of Income Tax-5, Kolkata -vs.- Rohit Baid in ITAT/44/2025 in IA No. GA/1/2025, which reads as under:- “The Court : This appeal has been filed by the revenue under Section 260A of the Income Tax Act, 1961 (in short, the Act) challenging the order dated September 12, 2024 passed by the Income Tax Appellate Tribunal, B-Bench, Kolkata (in short, the Tribunal) in ITA/15/Kol/2024 for the assessment year 2015-16. The revenue has raised the following substantial question of law for consideration: \"WHETHER in facts and in the circumstances of the case the Ld. Income Tax Appellate Tribunal was justified in holding the assessment order passed by the Assessing Officer under Section147 read with Section 144B of the Income Tax Act, 1961 on March 28, 2022 as bad in law based on an incorrect understanding of the provisions of Section 120 of the Income Tax Act, 1961 read with CBDT's Instruction No.1/2011 issued vide F. No. 187/12/2010- IT(A-I) dated January 31, 2011 which does not fix any rigid jurisdiction but is made for equitable distribution of work and thereby failing to appreciate that the Notice under Section 148 was correctly issued by the ITO, Ward 36(1), Kolkata who was the Assessing Officer having PAN jurisdiction over the assessee and subsequent assessment passed by the Faceless Assessing Officer was a valid assessment?\" Printed from counselvise.com ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 7 We have heard Mr. Prithu Dhudhoria, learned senior standing counsel appearing for the appellant/revenue. Though notice has been served, none appears for the respondent/assessee. On perusal of the impugned order passed by the learned Tribunal, we find that the issue is squarely covered in favour of the assessee by the decision of this Court in the case of Principal Commissioner of Income Tax- 11, Kolkata Vs. M/s. Nopany & Sons in ITAT/58/2017 dated February 4, 2022. The operative portion of the judgment reads as follows: \"The short issue which falls for consideration is whether the assessing officer, who had jurisdiction over the assessee at the relevant time had issued notice under Section 143(2) of the Act before taking up the scrutiny assessment under Section 143(3). Before we go into the facts, we take note of the legal position as laid down by the Hon'ble Supreme Court in Asst. CIT vs. Hotel Blue Moon [2010] 321 ITR 362 [SC], wherein the Hon'ble Supreme Court held that omission on the part of the assessing officer to issue notice under Section 143(2) cannot be a procedural irregularity and the same is not curable and, therefore, the requirement of notice under Section 143(2) cannot be dispensed with. Further, we also take note of the decision in the case of Commissioner of Income Tax -vs.- Gitsons Engineering Company, reported in [2015] 370 ITR 87, wherein it was held that the word 'shall' employed in Section 143(2) of the Act, contemplates that the assessing officer should issue notice to the assessee so as to ensure that the assessee has not understated income or has not computed excessive loss or has not under paid the tax in any manner. It was further held that when the assessing officer considers it necessary and expedient to ensure that tax is paid in accordance with law, he should call upon the assessee to produce evidence before him to ensure that the tax is paid in accordance with law. The section makes it clear that service of notice under Section 143(2) of the Act within the time limit prescribed is mandatory and it is not a mere procedural requirement. At this juncture, it would be relevant to take note of the definition of assessing officer as defined in Section 2(7A) of the Act. The said provision defines 'assessing officer' to mean the Assistant Commissioner or Deputy Commissioner or Assistant Director or Deputy Director or the Income Tax Officer, who is vested with the relevant jurisdiction by virtue of directions or orders issued under sub-Section (1) or sub-Section (2) of Section 120 or any other provision of the Act, and the Additional Commissioner or Additional Director or Joint Commissioner or Joint Director, who is directed under clause (b) of sub-Section (4) of Section 120 to exercise or perform all or any of the powers and functions conferred on, or assigned to, an assessing officer under this Act. In the instant case, the Printed from counselvise.com ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 8 order of assessment was challenged on several grounds and, particularly, on the ground that no notice under Section 143(2) of the Act was issued within the time prescribed by the assessing officer, who had jurisdiction over the assessment file of the assessee at the relevant time. The Commissioner of Income Tax (Appeals)-XXXVII, Kolkata, (CIT(A)) did not agree with the contentions raised by the assessee that there is failure to comply with the mandatory statutory requirement. The CIT(A) opined that the assessing officer, who originally dealt with the e-return filed by the assessee had issued notice under Section 143(2) of the Act. With regard to the merits of the matter, the CIT(A) held it in favour of the assessee. Therefore, the revenue was on appeal before the Tribunal and cross-objection was filed by the assessee questioning that portion of the order of the CIT(A) which held that there is no procedural irregularity committed by the assessing officer. The Tribunal considered the correctness of the finding of the CIT(A) and, on facts, found that both the assessing officers, namely, the assessing officer, who had jurisdiction over the assessee till 06.04.2009 and the assessing officer, who had jurisdiction post the said date had not issued notice under Section 143(2) of the Act within the prescribed period of six months from the end of the financial year in which the return was filed. This factual position could not be controverted by the revenue before us. As pointed out by the Hon'ble Supreme Court in the case of Asst. CIT vs. Hotel Blue Moon (supra), non-issuance of notice under Section 143(2) is not a procedural irregularity and, therefore, it is not curable. Thus, on facts, it having been established that no notice was issued under Section 143(2) of the Act, the order passed by the Tribunal was perfectly legal and valid. The revenue also sought to rely upon Section 292BB of the Act to justify their stand that notice is deemed to be valid and sought to bring the assessee's case under the circumstances mentioned in Section 292BB. This question was considered by the Tribunal and it was pointed out that Section 292BB provides that where an assessee has appeared in any proceedings or co-operated in any inquiry relating to an assessment or reassessment, it shall be deemed that any notice under any of the provision of the Act, which is required to be served upon him, has been duly served upon him in time in accordance with the provisions of the Act and such assessee shall be precluded from taking any objection in any proceeding or inquiry under the Act that the notice was not served upon him or not served upon him in time or served upon him in an improper manner. This amendment to the Act was introduced with effect from 01.04.2008 and the assessment year under consideration is AY 2007-08. In any event, the Tribunal Printed from counselvise.com ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 9 examined as to whether at all the revenue can rely upon Section 292BB of the Act and noted that the assessee has filed an objection vide letter dated 16.11.2009 objecting to the issuance of notice under Section 142(1) of the Act without valid service of notice under Section 143(2) of the Act. Taking note of the said letter the Tribunal, in our view, rightly held that the proviso to Section 292BB would not stand attracted and the said Section cannot be made applicable to the assessee's case. The Tribunal, thereafter, analysed as to the correctness of the submission of the revenue seeking to sustain their stand by referring to a notice issued by the assessing officer, who at the relevant point had no jurisdiction over the assessee and, on facts, found that there is no valid compliance of Section 143(2) of the Act as the notice issued under Section 143(2) of the Act by the assessing officer/Income Tax Officer, Ward-3(1) had no jurisdiction over the assessee at the relevant time. The Tribunal to support its conclusion placed reliance in the case of CIT & Another Vs. Mukesh Kumar Agarwal [2012] 345 ITR 29 (Allahabad), wherein it was held that the assessing officer did not have jurisdiction to proceed further and make assessment since notice under Section 143(2) of the Act was admittedly not issued. As in the case on hand, the revenue sought to take coverage under Section 292BB of the Act which was rejected on the ground that the very foundation of the jurisdiction of the assessing officer was on the issuance of notice under Section 143(2) of the Act and the same having been complied with, the revenue cannot take shelter under the provisions of Section 292BB of the Act.\" The learned Tribunal has taken note of the above decision while allowing the assessee's appeal. Apart from that, the other decision of this Court is in the case of PCIT Vs. Cosmat Traders (P) Ltd. reported at [2023] 146 taxmann.com 207 (Calcutta). The above decisions were rendered following the decision of the Hon'ble Supreme Court in the case of Asst. CIT Vs. Hotel Blue Moon, reported at [2010] 321 ITR 362 (SC). Thus, the issue is fully covered against the revenue. In the result, the appeal stands dismissed and the substantial question of law is answered against the revenue. The connected application stands closed”. 10. As we have already discussed in the preceding paragraph, the issue in the present case is squarely covered with the cited decision as discussed above, hence, the assessment order, which has been passed on the ground of jurisdiction is hereby quashed. The Printed from counselvise.com ITA No. 716/KOL/2025 (A.Y. 2018-2019) Vinod Kumar Giri 10 assessment framed under section 143(3) read with section 147 of the Act in this case is also bad in law and accordingly the assessment proceeding is also hereby quashed. 11. In the result, the appeal filed by the asseseee is allowed. Order pronounced in the open Court on 11/08/2025. Sd/- Sd/- (Rajesh Kumar) (Pradip Kumar Choubey) Accountant Member Judicial Member Kolkata, the 11th day of August, 2025 Copies to :(1) Vinod Kumar Giri, 158/2/1, Belilious Road, Kadamtala, Howrah-711101, West Bengal (2) Income Tax Officer, Ward-47(1), Kolkata, 3, Government Place (West), Kolkata-700001 (3) CIT(Appeals), NFAC, Delhi; (4) CIT - ; (5) The Departmental Representative; (6) Guard File TRUE COPY By order Assistant Registrar, Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S. Printed from counselvise.com "