Meena Swarup Vs DCIT (ITAT Delhi)
The appeal was filed against the order of the Commissioner of Income Tax (Appeals) dated 14.12.2018 arising from the assessment order passed under Section 143(3) for Assessment Year 2014-15. The assessee, a non-resident individual, had filed a return declaring income of ₹47,320. During assessment, the Assessing Officer treated the assessee’s Long Term Capital Gain (LTCG) of ₹2,47,91,254 as unexplained cash credit under Section 68, and the Commissioner (Appeals) confirmed the addition.
Before the Tribunal, the assessee raised additional legal grounds contending that the assessment proceedings were void because the notice under Section 143(2) had been issued by an Assessing Officer who lacked jurisdiction, while the Assessing Officer to whom the case was subsequently transferred did not issue a fresh notice under Section 143(2) before completing the assessment. The assessee also alleged that the assessment order proceeded on incorrect facts, reflecting non-application of mind. The Tribunal admitted the additional grounds after observing that they were purely legal in nature.
The assessee submitted that the return of income had been filed with ITO, Ward-22(4), New Delhi, while the scrutiny notice under Section 143(2) was issued by ITO, Ward-28(4), New Delhi, who, according to the assessee, had no jurisdiction. The assessee contended that she was a non-resident, a fact disclosed in the return of income and accepted by the Department, and therefore the proper jurisdiction vested with DCIT, International Taxation, Circle-3(1)(2), New Delhi. Although the case was subsequently transferred to the International Taxation Circle, that officer completed the assessment without issuing a notice under Section 143(2). It was argued that issuance of notice under Section 143(2) is mandatory for assuming jurisdiction and that proceedings initiated by a non-jurisdictional officer were void ab initio. The assessee relied upon judicial precedents including Hotel Blue Moon, Nopany & Sons, and M.I. Builders (P.) Ltd. in support of the legal challenge.
