Ram Kumar Gupta Vs DCIT (ITAT Delhi)
The ITAT Delhi admitted the assessee’s additional legal ground challenging the jurisdiction of the Assessing Officer and held that the notice issued under Section 143(2) by the ACIT was invalid as the jurisdiction, under CBDT Instruction No. 01/2011 dated 31.01.2011, vested with the ITO where the returned income of a non-corporate assessee in a metro city was below ₹30 lakh. The assessee had filed a return declaring income of ₹16,94,410, following which the ACIT issued the notice under Section 143(2), completed the assessment under Section 143(3), and made additions towards cash found during search under Section 69A and estimated business income. The CIT(A) partly allowed the appeal while confirming both additions. The Tribunal held that the issue was purely legal, required no further verification, and that the Assessing Officer lacked jurisdiction to issue the notice under Section 143(2). Relying on earlier judicial precedents, it held that the notice was bad in law and quashed the consequential assessment order. Since the assessment was quashed on the jurisdictional issue, the remaining grounds were treated as academic and were not adjudicated.
A scrutiny notice under section 143(2) issued by an Assessing Officer lacking pecuniary jurisdiction under CBDT Instruction No. 01/2011 is void ab initio, rendering the consequential assessment liable to be quashed.
