Hirak Sarkar Vs ACIT (ITAT Kolkata)
The Income Tax Appellate Tribunal (ITAT), Kolkata, allowed the assessee’s appeal for the Assessment Year 2011-12 after deciding the jurisdictional issue relating to reassessment under Sections 147 and 148 of the Income-tax Act. The assessee had challenged, among other grounds, the jurisdiction of the Assessing Officer who framed the reassessment order.
The Tribunal noted that the reasons for reopening the assessment and the notice under Section 148 were recorded and issued by the ITO, Ward-23(3), Hooghly. However, the reassessment order under Sections 143(3) read with 147 was ultimately passed by the ACIT, Circle-23(1), Hooghly. The assessee contended that, based on the CBDT’s pecuniary jurisdiction instructions, the returned income being below Rs. 15 lakh, jurisdiction to complete the assessment vested with the ITO and not the ACIT. The Revenue did not dispute these facts but argued that the ACIT, being in overall charge, was competent to complete the assessment.
After examining Sections 120 and 127 of the Income-tax Act, the Tribunal observed that jurisdiction may be determined on the basis of territorial area, classes of persons and income. It further noted that no document was produced to show that the case had been validly transferred from the ITO to the ACIT by the competent authority under Section 127. The Tribunal also found that the ACIT neither recorded independent reasons for reopening nor issued the notice under Section 148 before completing the reassessment.
