PCIT Vs Raghvendra Mohta (Calcutta High Court)
Calcutta High Court has upheld the Income Tax Appellate Tribunal’s decision to quash an assessment order against Raghvendra Mohta for the assessment year 2014-15, citing the Assessing Officer’s (AO) inherent lack of jurisdiction. The ruling in PCIT Vs Raghvendra Mohta dismisses the revenue’s appeal, emphasizing adherence to CBDT instructions regarding jurisdiction in nil income cases.
The case originated from an assessment order dated December 29, 2016, passed by the Assessing Officer under Section 143(3) of the Income Tax Act, 1961. This order was subsequently challenged by the assessee before the Commissioner of Income Tax (Appeals) and then before the Income Tax Appellate Tribunal (“B” Bench, Kolkata).
A primary contention raised by the assessee before the Tribunal was that the Assessing Officer who passed the assessment order did not possess the requisite jurisdiction over the case, thereby rendering both the initial notice and the final assessment order invalid.
The Tribunal noted that the assessee had filed a return of income declaring it to be “nil.” Subsequently, a notice under Section 143(2) was issued on September 10, 2015, followed by a notice under Section 142(1) with a questionnaire on June 13, 2016. The assessee’s challenge hinged on Section 120 of the IT Act, which deals with the jurisdiction of income tax authorities, and specifically referred to CBDT Instruction No. 1/2011, issued on January 31, 2011. This instruction, among other things, outlines the allocation of cases, particularly for “nil” income returns.
