DCIT Vs Boast Traders Pvt. Ltd (ITAT Kolkata)
Section 147 Reassessment Quashed for Lack of Jurisdiction and Invalid Section 143(2) Notice: ITAT Kolkata
The Revenue filed an appeal before the Income Tax Appellate Tribunal, Kolkata Bench, against the order of the Commissioner of Income Tax (Appeals)-7, Kolkata for Assessment Year 2010-11. The assessee also filed a cross-objection supporting the order of the CIT(A).
Material Facts and Procedural Background
A notice under Section 148 of the Income-tax Act, 1961 was issued on 22.03.2015 by the ITO, Ward-2(2), Kolkata after recording reasons for reopening the assessment. The assessee filed its return on 16.04.2015 declaring nil income and subsequently sought the recorded reasons for reopening. Thereafter, the ITO, Ward-2(2) issued notice under Section 143(2). Subsequently, the case was transferred to ITO, Ward-4(3), Kolkata, who issued notices under Sections 143(2) and 142(1) on 22.12.2015. The assessee objected to the validity of the notice under Section 148, contending that ITO, Ward-2(2) lacked jurisdiction in view of the transfer of jurisdiction based on PIN code. The ITO, Ward-4(3) completed the assessment under Sections 144(1)/147 on 28.03.2016 determining total income at ₹3,66,02,690.
The CIT(A) allowed the assessee’s appeal, holding that the reassessment order under Section 147 was without jurisdiction and that the reopening itself was bad in law. The CIT(A) also held on merits that no material had been brought on record to establish that the derivative loss claimed by the assessee was not genuine. The Revenue challenged this order before the Tribunal.
