On 16th November, 2022 the Income Tax Appellate Tribunal (ITAT) , Kolkata headed by a two-member bench of Sonjay Sharma, judicial member and Rajesh Kumar, accountant member. The Tribunal pronounced the result in favour of the appellant making it clear that any income tax assessment made by an officer who lacks jurisdiction in that assessment then the assessment will be considered void as stated under the instruction no.1/2011 (INSTRUCTION NO. 1/2011 [F.NO. 187/12/2010-IT(A-1)], Dated 31-1-2011) given by the Central Board of Direct Taxation (CBDT) .
The bench observed that an income tax return (ITR) filed by a non-corporate assesse in a non-metro city must be assessed by an income tax officer (ITO) when income is up to ₹15 lacs. As a result, the assessment was made in violation of CBDT (Central Board of Direct Taxation) Instruction No. 1/2011 (INSTRUCTION NO. 1/2011 [F.NO. 187/12/2010-IT(A-1)], Dated 31-1-2011) The appellant’s income tax return showed a total income of ₹10,02,340. The appellant’s case was chosen for limited scrutiny, and on 25th May, 2018, the ITO, Ward 1(1), Jalpaiguri, issued a notice under section 143(2). The assessment, however, was created by the Assistant Commissioner of Income Tax, Circle 1, Jalpaiguri. The assessment was void, ultra vires, and null in the eyes of the law, according to the appellant, because it was issued by the Assistant Commissioner of Income Tax, Circle 1(1), Jalpaiguri. According to CBDT Circular 1/2011 dated January 31, 2011, the Board has issued instructions that the assessment would be framed by the ITO in the case of a non-corporate assesse whose income is declared up to ₹15 lacs. The appellant argued that the order should be quashed because it was issued in violation of CBDT instructions by the Assistant Commissioner of Income Tax, Circle 1(l), Jalpaiguri, which is not a metro city.
The department stated that the appellant never raised the issue during the assessment or appellate proceedings, and thus the appellant should not be allowed to raise it at this stage. Alternatively, the issue may be reserved for the AO’s file, and because this is a procedural flaw, it may be corrected by the authorities below.
The ITAT concluded that the appellant is not a corporate assessee. The appellant received a notice under section 143(2) from ITO, Ward-1(1), Jalpaiguri, and the assessment was prepared by the Assistant Commissioner of Income Tax, Circle-1(1), Jalpaiguri.
The tribunal invalidated the assessment order due to a lack of jurisdiction.
CASE TITLE :- AMIYA GOPAL DUTTA VS DCIT
CITATION: I.T.A No. 126/Kol/2022
DATE: 16-11-2022
COUNSEL FOR APPELLANT : ADVOCATE SOMNATH GHOSH
COUNSEL FOR RESPONDENT: CIT DR SUDIPTO GUHA
Written by: Lakshman Singh, 3rd Semester BBA LLB, Shri Ramswaroop Memorial University, Lucknow
