INCOME TAX ACT, 1961

Section 147 Section 120(4) Section 143(3)

Reassessment - Legality - Jurisdiction and assessing authority of AO - Absence of order under section 120(4)(b)

The issue that came up for consideration from additional grounds raised by the assessee was that whether the Jt. CIT who passed the reassessment order, dated 20-3-2015 was vested with jurisdiction and authority to pass such order in absence of proper order under section 120(4)(b). Authorised representative submitted that the Jt.CIT or Addl. CIT can exercise or perform any of the powers and functions of the AO, if he was directed under section 120(4)(b) unless, he was directed by a specific order under said section, he cannot perform any of the powers and functions of the AO. The order passed by the Jt. CIT, Range-17, Mumbai was, therefore, void ab initio and liable to be quashed. It was submitted by DR. that once there is CIT/Addl. CIT to act as an AO, then there was no need of separate order under section 120(4)(b).Held: Revenue had failed to file any order passed by the Principal Chief CIT/Chief CIT/Pr. CIT, under section 120(4)(b), authorising the Jt. CIT to act as an AO in the case of the assessee. Although the revenue filed copy of the Board's general notification authorising Jt. CIT/Addl. CIT to act as an AO, but failed to file the order of the Pr. CIT under section 120(4)(b), empowering the Jt. CIT to act as an AO. Further although, the Revenue had filed order of the Pr.CIT-17, Mumbai passed under section 120(1) and (2), but said order was not under section 120(4)(b). In this case, no doubt the Revenue had filed notification issued by the Central Board of Direct Taxes under section 120(4)(b), but failed to file separate order passed by the Principal Commissioner under section 120(4)(b). Reassessment order passed under section 143(3) read with section 147 by the Joint CIT, Range17, Mumbai was, therefore, void ab initio and liable to be quashed, because, the AO who had passed reassessment order does not had valid jurisdiction and authority to pass such order, in absence of proper order in writing under section 120(4)(b). further in view of plea of DR it could be held that time-limit provided under section 123(3) had a relation to the AO territorial jurisdiction, but said time-limit would not apply to the case where the assessee contends the action of the AO was without authority of law and therefore, wholly without jurisdiction.

Followed:Tribunal, Mumbai in the case of Tata Communications Ltd. v. Asst. CIT in I.T.A. No. 3972/Mum/2017 for the assessment year 2003-04 in Order, dated, 16-8-2019; Bansilal B. Raisoni and Sons v. Asst. CIT (2019) 260 Taxman 281 (Bom) : 2018 TaxPub(DT) 7785 (Bom-HC). Relied: Tata Sons Ltd. v. Asstt. CIT (2017) 162 ITD 450 (Mum-trib) : 2016 TaxPub(DT) 5055 (Mum-Trib). Distinguished:Mega Corporation Ltd. v. Addl. CIT (2015) 62 Taxmann.com 351 (Del-Trib) : 2015 TaxPub(DT) 4298 (Del-Trib).

REFERRED : Tata Sons Ltd. v. Asst. CIT (2017) 162 ITD 450 (Mum-Trib) : 2016 TaxPub(DT) 5055 (Mum-Trib), Microfin Securities (P.) Ltd. v. Addl. CIT (2005) 3 SOT 302 (Luck-Trib) : 2005 TaxPub(DT) 1513 (Luck-Trib), Asstt. CIT v. Tata Sons Ltd. [ITA. No. 2519/Mum/2009, dated 11-3-2019] : 2019 TaxPub(DT) 1891 (Mum-Trib), Dy. CIT v. Ganesh Realty and Mall Development Pvt. Ltd. [ITA. No. 581 (Kol) of 2017, dated 23-1-2019], Bansilal B. Raisoni and Sons v. Asstt. CIT (2019) 260 Taxman 281 (Bom) : 2018 TaxPub(DT) 7785 (Bom-HC).

FAVOUR : In assessee's favour.

A.Y. : 2006-07 & 2007-08

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