Case Law Details
Amit Kumar Gupta Vs ITO (ITAT Raipur)
ITAT Raipur held that order of transfer of case under section 127 of the Income Tax Act without granting opportunity of being heard to appellant is bad-in-law. Accordingly, matter restored back to file of CIT(A).
Facts- AO based on information gathered from NMS/ITS module that though the assessee during the subject year had made cash deposits of Rs.17,05,824/- in his bank account but had not filed his return of income, initiated proceedings u/s. 147 of the Act. Notice u/s. 148 of the Act, dated 23.03.2018 was issued by the A.O.
Notably, though the notice u/s. 148 of the Act, dated 23.03.2018 was issued by the ITO-1, Ambikapur, but thereafter, pursuant to the order u/s. 127 of the Act, dated 07.09.2018 passed by the Pr. CIT-1, Bilaspur the case of the assessee was transferred to ITO-3, Korba.
AO held that entire amount as his unexplained money u/s. 69A of the Act. Accordingly, the A.O vide his order passed u/s.144 r.w.s. 147 of the Act, dated 16.12.2018 determined the income of the assessee at the same amount. CIT(A) upheld the addition. Being aggrieved, the present appeal is filed.
Conclusion- Held that the assessee had assailed the validity of the jurisdiction that was assumed by the A.O for framing the impugned assessment u/s. 144 r.w.s. 147 of the Act, dated 16.12.2018 on the ground that the order of transfer passed by the Pr. CIT, Bilaspur u/s. 127 of the Act was not as per the mandate of law. I am unable to concur with the CIT(Appeals) that he was not vested with any jurisdiction to deal with the specific challenge raised by the assessee as regards the validity of the assessment order that was framed by the A.O de-hors a valid assumption of jurisdiction on his part in absence of an order of transfer u/s. 127 of the Act as required per the mandate of law. I am of the view that the CIT(Appeals) ought to have taken call and adjudicated the aforesaid specific issue, instead of refraining from dealing with the same, which, thus, had resulted to multiplicity of litigation and pushed the assessee into further litigation on the said issue before me.
As I have restored the matter to the file of the CIT(Appeals) for fresh adjudication in terms of my aforesaid observations, therefore, I refrain from dealing with the other contentions, based on which, the validity of the jurisdiction assumed by the A.O for initiating proceedings u/s. 147 of the Act as well as the merits of the addition had been raised before me, which, thus, are left open.
FULL TEXT OF THE ORDER OF ITAT RAIPUR
The captioned appeals filed by the assessee are directed against the orders passed by the Commissioner of Income-Tax (Appeals), National Faceless Appeal Center (NFAC), Delhi, dated 11.06.2024, which in turn arises from the respective orders passed by the A.O under Sec. 144 r.w.s. 147 of the Income-tax Act, 1961 (in short ‘the Act’) dated 16.12.2018 for the assessment year 2012-13 & 2011-12. As the facts and issues involved in the captioned appeals are common, therefore, the same are being taken up and disposed off by way of a consolidated order.
2. I shall first take up the appeal filed by the assessee in ITA No.405/RPR/2024 for assessment year 2011-12 as the lead matter and the order, therein, passed shall mutatis-mutandis apply for the purpose of disposing the other appeal. The assessee has assailed the impugned order on the following grounds of appeal:
“1. That under the facts and the law, the Assessment order is void-ab-initio as the same has been passed without serving Notice u/s.148 and without allowing opportunity to the appellant opportunity to the Appellant to explain the case.
2. That under the facts and the law, the Ld. CIT (Appeals) erred in dismissing the ground that jurisdiction to assess the Appellant lies with the Assessing Officer, Korba and that the transfer of case u/s 127 from Ambikapur to Korba has been made without giving any opportunity to the Appellant. Prayed that the assessment has been made without jurisdiction as the place of business and residence of the Appellant is at Ramanujganj which is far away from Korba.
Prayed to annul the Assessment Order.
3. That under the facts and the law, the Ld. CIT (Appeals) erred in dismissing the explanation that the cash deposited Rs.17,05,824 into bank was from business receipts from recharging of Mobile Phones and savings. Prayed to delete the addition of Rs.17,05,824/-.
Prayed to delete the addition of Rs.17,05,824/-.
3. Shri G.S. Agrawal, Ld. Authorized Representative (for short ‘AR’) for the assessee, at the threshold, submitted that the captioned appeal involve a delay of 24 days. On a perusal of the records, it transpires that considering the application for condonation of delay a/w. affidavit, dated 17.09.2024, the said delay had been condoned vide order sheet entry dated 13.12.2024.
4. Succinctly stated, the A.O based on information gathered from NMS/ITS module that though the assessee during the subject year had made cash deposits of Rs.17,05,824/- in his bank account but had not filed his return of income, initiated proceedings u/s. 147 of the Act. Notice u/s. 148 of the Act, dated 23.03.2018 was issued by the A.O.
5. As is discernible from the assessment order, it transpires that though the notice u/s. 148 of the Act, dated 23.03.2018 was issued by the ITO-1, Ambikapur, but thereafter, pursuant to the order u/s. 127 of the Act, dated 07.09.2018 passed by the Pr. CIT-1, Bilaspur the case of the assessee was transferred to ITO-3, Korba.
6. As the assessee failed to comply with the notices which were issued by the A.O u/s.142(1) of the Act, dated 29.09.2018 and 12.1.0.2018, therefore, the latter was constrained to proceed with and frame the assessment to the best of his judgment u/s.144 of the Act. The A.O based on information gathered from NMS/ITS module as regards the cash deposits made by the assessee in his bank account issued notice u/s. 133(6) of the Act, dated 12.10.2018 to State Bank of India, Branch: Ramanujganj directing it to file a copy of the bank statement of the assessee. However, the bank failed to carry out necessary compliance and did not place on record a copy of the bank statement of the assessee. Considering the fact that the assessee had failed to come forth with any explanation as regards the source of cash deposits of Rs.17,05,824/- in his bank account during the year under consideration, the A.O held the entire amount as his unexplained money u/s. 69A of the Act. Accordingly, the A.O vide his order passed u/s.144 r.w.s. 147 of the Act, dated 16.12.2018 determined the income of the assessee at the same amount.
7. Aggrieved the assessee carried the matter in appeal before the CIT(Appeals). The assessee had assailed the order passed by the A.O u/s. 144 r.w.s. 147 of the Act, dated 16.12.2018 based on three grounds viz. (i) that the Pr. CIT-1, Bilaspur had vide his order passed u/s. 127 of the Act, dated 07.09.2018 transferred his case from ITO-1, Ambikapur to ITO-3, Korba without affording any opportunity of being heard to the assessee as was required per the mandate of law; (ii) that the A.O had grossly erred in law and facts of the case in framing the assessment u/s. 144 r.w.s. 147 of the Act in absence of any valid service of notice to the assessee; and (iii) that the A.O had grossly erred in law and facts of the case in treating the entire amount of Rs.17,05,824/- as the assessee’s unexplained money u/s. 69A of the Act. However, the CIT(Appeals) did not find favour with the multi-facet contentions that were advanced by the assessee and upheld the addition made by him, observing as under:
“7. Discussion and Decision
I have gone through the Grounds of Appeal, Statement of Facts, assessment order, written submission along with supporting evidence, remand report of the AO and rejoinder provided by the appellant. The grounds of appeal filed by the appellant are being adjudicated are as under:-
7.1. Ground No. 01:
The appellant has raised legal ground and has submitted in the appellate proceedings that the order of the Ld. AO is bad in law and facts, under presumption and surmises, arbitrary and deserves to AR are general in nature s to be annulled. The submissions of the learned and therefore dismissed. Accordingly, ground of appeal No. 1 is therefore dismissed.
7.2. Ground No. 02:
In this ground, the appellant has challenged the jurisdiction of the Assessing Officer. The appellant claimed that even the order w/s. 127 was passed without giving him opportunity of being heard.
7.2.1. On perusal of assessment order/remand report, it was found that the case was transferred u/s 127 of the Act(order u/s 127 passed by the Hon’ble PCIT, Bilaspur on 07.09.2018) from the O/o ITO-1, Ambikapur to C/o ITO-3, Korba. Accordingly, the Assessing Officer has completed the assessment proceedings following the order of PCIT, Bilaspur, Further, CIT(A) Is-not the appropriate forum to challenge the order u/s. 127 passed by the PCIT, Bilaspur, in view of the above, the appellant’s claim is hereby rejected. Hence, this ground of appeal No. 2 is dismissed.
7.3. Ground No. 03 and 05:
In these grounds the appellant challenged the Assessment proceedings u/s 144 r.w.s. 147 being ex-parte assessment as no notices were received by the appellant and claimed the assessment order as null and void.
7.3.1 On perusal of assessment order that a notice u/s 148 of the Act was issued on 23.03.2018 on the address available with the department by the AO i.e. the ITO-1, Ambikapur. According to this notice, the ITR was to be filed within 30 days from receipt of the notice by the appellant, but he neither filed the ITR nor filed any written submission. Further, due to change in incumbent, the AO I.e. ITO-3, Korba issued notices u/s 142(1) of the Act on 29.09.2018, 12.10.2018 and 26.10.2018, but the appellant failed to respond to any of the notices. All the notices were issued by the AO on the address available with the department. If there was any change in the PAN address, it was the necessary for the appellant to change the address in PAN and to communicate to the AO. However, based on records available, it is seen that the appellant failed to update his address and even failed to communicate any change in the address to the AQ. The AO also stated in his remand report that the fact cannot be denied that the appellant himself acknowledged the address on which the letters/orders sent, returned by India post with the remark as addressee not found. The AO also stated if the address is not correct or the appellant is not found to reside at the address available with the department, it is the appellant who had to change the address in e-filing portal, In this case the appellant failed to appellant had also not given his digital footprint his filing portal. That’s why all the do so. Further the correspondences were made through the postal department on the address available with the department.
7.3.2 Reliance is placed on the Order of Hon’ble Supreme Court in the case of PCIT Vs. Iven Interactive Limited, 2019 418 ITR 662 (SC) wherein the Hon’ble Supreme Court has observed as follows.
“Mere mentioning of the new address in the return of income without specifically intimating the Assessing Officer with respect to change of address and without getting the PAN database changed, is not enough and sufficient. In absence of any specific intimation to the Assessing Officer with respect to change in address and/or change in the name of the assessee, the Assessing Officer would be justified in sending the notice at the available address mentioned in the PAN database of the assessee, more particularly when the return has been filed under E-Modulo scheme. It is required to be noted that notices under Section 143(2) of the 1961 Act are issued on selection of case generated under automated system of the Department which picks up the address of the assessee from the database of the PAN. Therefore, the change of address in the database of PAN is must, in case of change in the name of the company and/or any change in the registered office or the corporate office and the same has to be intimated to the Registrar of Companies in the prescribed format (Form 18) and after completing with the said requirement, the assessee is required to approach the Department with the copy of the said document and the assessee is also required to make an application for change of address in the department at database of PAN.”
7.3.3. Therefore, in view of the above discussion, the AO is justified in sending the notices available with the department and fulfilled the statutory requirements. It was failure on part of the appellant to update the correct address in PAN database and communicate to the department. Therefore, the notices issued by the AO to appellant on address available are valid and the appellant failed to respond to the notices issued. In the above condition, the AO had no option but to complete the assessment ex-parte due to time barring of assessment proceedings. Therefore, the assessment completed by the AO u/s. 144 r.w.s. 147 is valid. Accordingly, the Ground No. 3 and 5 are dismissed.
7.4. Ground No. 4 and 6:
This ground of the appeal relates to addition of Rs.17,05,824/- u/s 69A in the assessment order by the AD on account of cash deposits in the appellant’s saving account during the year under consideration.
7.4.1. As per information received from NMS/ITS Module the appellant deposited Rs.17,05,824/- in cash in his saving bank account during F.Y. 2010-11 relevant to assessment year 2011-12. The appellant did not file Income Tax Return for the year under consideration. The appellant did not respond to any of the notices issued by the AO. During the assessment proceedings, the AO issued notice u/s 133(6) of the Act to the State Bank of India, Ramanujganj for providing bank statement of F.Y. 2010-11 of the appellant. However the bank neither provided the statement nor replied any response. Consequently, the AO passed assessment order u/s 144 r.w.s. 147 of the Act on 16.12.2008 assessing a total income of Rs. 17,05,824/- u/s 69A as unexplained income/money.
7.4.2. During the appellate proceedings, the appellant submitted response in which the appellant stated that he derived income from distributorship of recharge coupon and talk time coupon sale of Vodafone Cellular Co. Ltd. Further, he stated that the basic business model of mobile recharge business that local shops/Pan thela/Grumitwala and small retailers purchase talk time balance coupon “Known as Top-up from appellant and pay cash to the distributer. These retailers further recharge this value to Vodafone customers according to their needs say Rs. 10 to Rs. 2000 via scratch coupon or direct from mobile recharge method. At the end of day the appellant staffs collect cash from retailer and then deposited to bank account which is then further remitted through NEFT/RTGS to Vodafone Cellular Co. designated account. The Vodafone do gives commission to distributor for this service and deducts TDS as per provisions of Income Tax Act. Since Vodafone Essar merged with Idea Cellular Co and at present old Co is not in existence therefore now it’s not possible for appellant to produce any documentary evidence/ confirmation from that Co. However, in bank statement narration Vodafone Essar is clearly mentioned. In support of this the appellant submitted the evidence in the form of bank account statement, bank book, cash book, 26AS and ledger of M/s. Vodafone Essar. However, during the appellate proceedings, the appellant failed to file any response and did not provide any supporting documents so that the source of income can be verified. Hence, written submission and supporting documents provided by the appellant during the appellant proceedings was sent to the AO for examining the facts and asked for remand report.
7.4.3. In the remand report the AO stated that the appellant was asked to produce the books of accounts, bank statement for the year under consideration and other supporting documents to verify the genuineness submission made before the Hon’ble CIT(A), but the appellant did not make any compliance to substantiate his claim what he has made before Hon’ble CIT(A). Further he stated that on examination of bank statement, it was found that the debit entries made to Vodafone Essar, but the appellant did not file any compliance to substantiate as to for what purpose the payment made to Vodafone Essar. The onus lies on the appellant to substantiate with evidence to prove that he was authorized by the Vodafone Essar for retail Marketing. retail trading, this fact was also not reflected in Form 26AS. No commission income was found to be received by the appellant. The AD could not verify genuineness of the transaction in the absence of any supporting evidence received from the appellant. The appellant was asked for comments on remand report received from the AO; however, the appellant did not respond till now.
7.4.4. I have also examined the cash book, bank book, bank statement, 26AS and remand report. On verification it was found that there were few debit entries in the bank statement of the appellant regarding payments made to M/s. Vodafone Essar. However, in absence of other supporting evidence like bills and vouchers, it is not conclusively established the fact that all the payments made to M/s. Vodafone Essar was for the business purpose. Further, the onus is on the appellant to establish the source of cash deposited beyond doubt the appellant has failed to discharge his onus in the assessment proceedings and appellate proceedings as well. Only submitting self-serving cash book and bank book is not sufficient to discharge the onus on the appellant in absence to supporting evidence to establish the source of cash deposited. The appellate further claimed that he had received commission from M/s. Vodafone Essar for retail marketing. However, on verification of 26AS, no such commission income was found received by the appellant. Thus, the genuineness of the cash deposit transactions cannot be conclusive found established or couldn’t be verified based on submission made by the appellant in absence of any supporting concrete evidence.
7.4.5. Considering the above facts and circumstances, I am of the view that the appellant’s supporting evidence does not substantiate the claim of the appellant at any stage. The appellant was given adequate and sufficient opportunities to prove genuineness of these transactions during the assessment proceedings, appellate proceedings and remand report but he failed to do so. The submission made during the appellate proceedings was not sufficient to establish the source of the cash deposits in bank accounts. Thus, the appellant failed to discharge onus casted upon him to establish the source of cash deposited in bank account beyond any doubt. In view of the above discussion, the addition of Rs.17,05,824/- made by the AO is therefore confirmed. Accordingly, Ground No. 4 and 6 of the appeal are dismissed.
7.5. Ground No. 07 & 08
In these grounds, the appellant challenged the interest charged and penalty proceedings initiated. These grounds of the appeal are consequential in nature and no adjudication is required. Hence Grounds of appeal No. 7 and 8 are dismissed for statistical purpose.
8. In the result, the appeal of the appellant is dismissed.”
8. The assessee being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before the Tribunal.
9. I have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record.
10. Shri G.S. Agrawal, Ld. AR for the assessee, at the threshold, submitted that the A.O had grossly erred in law and facts of the case in assuming jurisdiction de-hors any valid order of transfer u/s. 127 of the Act having been passed by the Pr. CIT-1, Bilaspur. Elaborating on his contention, the Ld. AR submitted that the Pr.CIT-1, Bilaspur vide his order passed u/s. 127 of the Act, dated 07.09.2018 [as could be gathered from the order of the CIT(Appeals)] had though transferred the case of the assessee from ITO-1, Ambikapur to ITO-3, Korba but while doing so had failed to afford an opportunity of being heard to the assessee as required per the mandate of law. The Ld. AR to fortify his aforesaid contention had drawn my attention to sub-section (3) of Section 127 of the Act which contemplates that a statutory obligation is cast upon the Pr. CIT to afford an opportunity of being heard to the assessee where his case is being transferred from the A.O (whether with or without concurrent jurisdiction) to any other A.O (whether with or without concurrent jurisdiction) and the offices of all such officers are not situated in the same city. Carrying his contention further, the Ld. AR submitted that though the assessee had specifically assailed the validity of the jurisdiction assumed by the A.O de-hors any valid order of transfer having been passed by the Pr. CIT u/s. 127 of the Act before the CIT(Appeals), but the latter had refrained from dealing with the same for the reason, that he was not the appropriate forum to challenge the order passed by the Pr. CIT-1, Bilaspur u/s. 127 of the Act. The Ld. AR had taken me through the observations of the CIT(Appeals) at Para 7.2.1. of his order. The Ld. AR submitted that as the assessee had not assailed before the CIT(Appeals) the order passed by the Pr. CIT-1, Bilaspur u/s. 127 of the Act but the validity of the jurisdiction that was assumed by the A.O for framing the impugned assessment vide his order passed u/s. 144 r.w.s. 147 of the Act, dated 16.12.2018 in absence of a valid order of transfer u/s. 127 of the Act, therefore, the CIT(Appeals) was obligated to have adjudicated the said grievance.
11. Smt. Anubhha Tah Goel, Ld. Sr. Departmental Representative (for short ‘DR’) relied on the orders of the lower authorities. The Ld. DR pursuant to the direction of the Tribunal had placed on record a report of the A.O. The Ld. DR submitted that the A.O. i.e. ITO-1, Ambikapur had filed his report dated 09.01.2025, wherein it is stated by him that the order passed by the Pr. CIT, Bilaspur dated 07.09.2018 could not be traced but a reference of the same is mentioned in the assessment order.
The Ld. DR submitted that as the case of the assessee had been transferred pursuant to the order passed by the Pr. CIT, Bilaspur u/s.127 of the Act from the ITO-1, Ambikapur to ITO-3, Korba, therefore, the latter had rightly assumed jurisdiction and framed the assessment vide his order passed u/s.144 r.w.s. 147 of the Act, dated 16.12.2018.
12. I have thoughtfully considered the contentions advanced by the Ld. Authorized Representatives of both the parties qua the issue in hand i.e. validity of the jurisdiction assumed by the A.O for framing the assessment vide his order passed u/s. 144 r.w.s. 147 of the Act, dated 16.12.2018 in the backdrop of the order passed by the Pr. CIT, Bilaspur u/s. 127 of the Act, dated 07.09.2018 transferring the case of the assessee from ITO-1, Ambikapur to ITO-3, Korba.
13. Controversy involved in the present appeal lies in a narrow compass, (i) as to whether or not the case of the assessee had been transferred pursuant to the order passed by the Pr. CIT, Bilaspur u/s. 127 of the Act from ITO-1, Ambikapur to ITO-3, Korba as per the mandate of law; and (ii) that as to whether or not, the CIT(Appeals) is right in law and facts of the case in refraining from adjudicating the specific grievance of the assessee that as the Pr. CIT, Bilaspur without affording an opportunity to the assessee had transferred his case pursuant to the order passed u/s. 127 of the Act, dated 07.09.2018 from ITO-1, Ambikapur to ITO-3, Korba, therefore, the latter had wrongly assumed jurisdiction and framed the impugned assessment.
14. I deem it fit to deal with the second issue first i.e. as to whether or not, the CIT(Appeals) is justified in refraining from adjudicating the specific grievance of the assessee that the ITO-3, Korba had wrongly assumed jurisdiction and framed the assessment vide his order passed u/s. 144 r.w.s. 147 of the Act, dated 16.12.2018 in absence of a valid order of transfer having been passed by the Pr. CIT, Bilaspur u/s. 127 of the Act. As observed by me hereinabove, the genesis of the controversy find its roots in the fact that the Pr. CIT vide his order passed u/s. 127 of the Act, dated 07.09.2018 while transferring the case of the assessee from ITO-1, Ambikapur to ITO-3, Korba wherein offices of the respective offers were situated in different cities, had failed to afford an opportunity of being heard to him while passing the order of transfer. Before proceeding any further, it would be apt to cull out the provisions of Section 127 of the Act, which reads as under:
“127. (1) The Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, transfer any case from one or more Assessing Officers subordinate to him (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) also subordinate to him.
(2) Where the Assessing Officer or Assessing Officers from whom the case is to be transferred and the Assessing Officer or Assessing Officers to whom the case is to be transferred are not subordinate to the same Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner,—
(a) where the Principal Directors General or Directors General or Principal Chief Commissioners or Chief Commissioners or Principal Commissioners or Commissioners to whom such Assessing Officers are subordinate are in agreement, then the Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner from whose jurisdiction the case is to be transferred may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, pass the order;
(b) where the Principal Directors General or Directors General or Principal Chief Commissioners or Chief Commissioners or Principal Commissioners or Commissioners aforesaid are not in agreement, the order transferring the case may, similarly, be passed by the Board or any such Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner as the Board may, by notification in the Official Gazette, authorise in this behalf.
(3) Nothing in sub-section (1) or sub-section (2) shall be deemed to require any such opportunity to be given where the transfer is from any Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) and the offices of all such officers are situated in the same city, locality or place.
(4) The transfer of a case under sub-section (1) or sub-section (2) may be made at any stage of the proceedings, and shall not render necessary the re-issue of any notice already issued by the Assessing Officer or Assessing Officers from whom the case is transferred.
Explanation.—In section 120 and this section, the word “case”, in relation to any person whose name is specified in any order or direction issued thereunder, means all proceedings under this Act in respect of any year which may be pending on the date of such order or direction or which may have been completed on or before such date, and includes also all proceedings under this Act which may be commenced after the date of such order or direction in respect of any year.
(emphasis supplied by me)
15. As can be gathered from sub-section (3) of Section 127 of the Act, in a case where the Pr. CIT transfers the case of as assessee from any Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) and the offices of all such officers are not situated in the same city, locality or place., then he remains under a statutory obligation to give an opportunity of being heard to the assessee and only after recording his reasons for doing so, transfer such case from one or more Assessing Officers subordinate to him (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) also subordinate to him. As in the case of the present assessee before me, the case of the assessee had been transferred pursuant to the order of the Pr. CIT, Bilaspur dated 07.09.2018 from ITO-1, Ambikapur to ITO-3, Korba i.e. offices of said officers are not situated in the same city, locality or place, therefore, on a conjoint reading of subsection (1) and (3) of Section 127 of the Act, he was obligated to have given an opportunity to the assessee prior to transfer of his case.
16. Ostensibly, the assessee had specifically assailed the validity of the jurisdiction that was assumed by the A.O for framing the assessment vide his order passed u/s. 144 r.w.s. 147 of the Act, dated 16.12.2018, inter alia, for the reason that the Pr. CIT, Bilaspur while transferring the case of the assessee u/s. 127 of the Act from the ITO-1, Ambikapur to ITO-3, Korba had failed to give an opportunity of being heard to him. As observed by me hereinabove, the CIT(Appeals) had refrained from adjudicating the aforesaid specific challenge to the validity of the jurisdiction that was assumed by the A.O for framing the assessment by holding a conviction that he was not a proper forum to challenge the order passed by the Pr. CIT, Bilaspur u/s. 127 of the Act. I am unable to persuade myself to concur with the aforesaid observation of the CIT(Appeals). I am of the view that the assessee had assailed the validity of the jurisdiction that was assumed by the A.O for framing the impugned assessment u/s. 144 r.w.s. 147 of the Act, dated 16.12.2018 on the ground that the order of transfer passed by the Pr. CIT, Bilaspur u/s. 127 of the Act was not as per the mandate of law. I am unable to concur with the CIT(Appeals) that he was not vested with any jurisdiction to deal with the specific challenge raised by the assessee as regards the validity of the assessment order that was framed by the A.O de-hors a valid assumption of jurisdiction on his part in absence of an order of transfer u/s. 127 of the Act as required per the mandate of law. I am of the view that the CIT(Appeals) ought to have taken call and adjudicated the aforesaid specific issue, instead of refraining from dealing with the same, which, thus, had resulted to multiplicity of litigation and pushed the assessee into further litigation on the said issue before me.
17. Accordingly, I not being able to persuade myself to concur with the view taken by the CIT(Appeals) restore the matter to his file with a direction to adjudicate the challenge thrown by the assessee as regards the validity of the jurisdiction that was assumed by the A.O for framing of the assessment vide his order passed u/s. 144 r.w.s. 147 of the Act dated 16.12.2018 de-hors an order of transfer u/s. 127 of the Act passed by the Pr. CIT, Bilaspur as per the mandate of law. Thus, the Ground of appeal No.2 raised by the assessee is allowed for statistical purposes in terms of the aforesaid observations.
18. As I have restored the matter to the file of the CIT(Appeals) for fresh adjudication in terms of my aforesaid observations, therefore, I refrain from dealing with the other contentions, based on which, the validity of the jurisdiction assumed by the A.O for initiating proceedings u/s. 147 of the Act as well as the merits of the addition had been raised before me, which, thus, are left open.
19. In the result, appeal of the assessee in ITA No.405/RPR/2024 for A.Y.2011-12 is allowed for statistical purposes in terms of the aforesaid observations.
ITA No.404/RPR/2024
A.Y.2012-13
20. As the facts involved in the captioned appeal filed by the assessee remains the same as were there before me in the aforementioned ITA No.405/RPR/2024 for assessment year 2011-12, therefore, my order therein passed while disposing off the said appeal shall apply mutatis-mutandis for disposing off the captioned appeal, i.e., ITA No. 404/RPR/2024 for A.Y. 2012-13. In this case also, I restore the matter to the file of the CIT(Appeals) with similar directions as were recorded by me in ITA No.405/RPR/2024 for A.Y 2011-12.
21. In the result, appeal of the assessee in ITA No.404/RPR/2024 for A.Y.2012-13 is allowed for statistical purposes in terms of the aforesaid observations.
22. Resultantly, both the appeals filed by the assessee are allowed for statistical purposes in terms of the aforesaid observations.
Order pronounced in open court on 13th day of January, 2025.
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