INCOME TAX ACT, 1961

Section 127

Transfer of case - Validity - Assessment order passed by AO having no territorial jurisdiction over assessee -

Assessee contended that AO had no jurisdiction to complete the assessment in Kolkata, since the jurisdiction over the assessee was duly transferred under section 127 to ACIT, Central Circle 2(3), Chennai, therefore, assessment framed by AO [ITO,Wd-1(4), Kolkata], dated 24-3-2014 under section 143(3)/147/263/144 of the Act was without jurisdiction and therefore should be quashed. Held: In assessee`s case under consideration, the order under section 127 was issued by the Commissioner of Income Tax, Kolkata-1, on 15-3-2013 whereby the Commissioner transferred the jurisdiction from ITO,Wd- 1(4), Kolkata to ACIT Central Circle-II(3), Chennai. Whereas, the assessment order was passed by AO Ward-1(4) Kolkata on 24-3-2014, which was without jurisdiction. Even a 'right' decision by a 'wrong' forum was no decision. It was non-existent in the eye of law and hence a nullity. The assessment order under appeal was therefore no order in the eye of law, hence the assessment order was quashed.

REFERRED : SBI v. S.N. Goyal reported in 2009 (8) SCC 92; Re V.G.M. Holdings, Ltd. reported in 1941 (3) All England Law Reports, 417; ITO, 'A' Ward, District Howrah And Others v. Ashoke Glass Works reported in (1980) 125 ITR 491 (Cal); Pandurang and Others v. State of Maharashtra reported in (1986) 4 SCC 436; RAMSHILA ENTERPRISES PRIVATE LTD, 383 ITR 546 (Cal-HC)

FAVOUR : In assessee's favour

A.Y. : 2008-09

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