SETECH ELECTRONICS LTD,NEW DELHI vs. ITO WARD - 3(4), NOIDA

By way of the Assessee has challenged the dismissal of its appeal and affirmation of assessment order dated 21.11.2016 passed by the AO u/s. 144/148 of the Act, whereas though the Revenue is not affected by the said order, however the Revenue Department has also preferred the cross objection against the dismissal of the appeal by the ld. Commissioner on the ground of jurisdiction.

In brief, facts of the case are the received an information received from AIR to the effect that the Assessee had purchased an immovable property for a consideration of Rs.1.2 Crores on dated 25.04.2008 during the year under consideration, therefore, in order to verify the said transaction, the notice u/s. 133(6) of the Act was issued on 19.10.2015 to the Assessee, which remained un- complied with. Thereafter by recording the reasons the proceedings u/s. 147 of the Act have been initiated by issuing a notice dated 29.03.2016 u/s. 148 of the Act to the Assessee. But still, no compliance was made by the Assessee. Thereafter, various statutory notices have also been issued to the Assessee which also remained un-complied with. Therefore considering the peculiar facts and circumstances, the Assessing Officer made the addition of Rs.1.2 crores as unexplained investment u/s. 69 of the Act.

The Assessee before the ld. Commissioner challenged the said assessment order and the addition made by the Assessing Officer on the ground of jurisdiction as well as on merits mainly on the reason that the Assessee’s company is assessed in New Delhi vide PAN – AAACS1057Q for the last many years, therefore, the Assessing Officer at Noida had no jurisdiction to assess the case of the Assessee.

The ld. Commissioner by holding that “in the instant case, the appeal of the appellant cannot be admitted because of non- compliance of the mandatory provisions of section 249(4)(b) of the IT Act, 1961 and therefore, the issue regarding merits of the case or the non-compliance of mandatory procedure by the ld. A.O. also cannot be considered in the present appeal, as legally speaking, there is case of no appeal before this office. Therefore, the present appeal cannot be admitted. For want of requisite jurisdiction, the ld. Commissioner dismissed the appeal of the Assessee and affirmed the assessment order dated 21.11.2016. The Assessee being aggrieved is in appeal before us.

The Assessee challenged the impugned order on the ground of jurisdiction as well as on merits. The Revenue Department also preferred the C.O. No. 40/Del/2020, mainly on the ground that since the ld. CIT(A) Noida, who passed the impugned order was prematurely retired from service and therefore did not have any jurisdiction to the pass the impugned orders thereafter as passed in these cases and therefore the impugned orders are void-ab-initio.

We have given thoughtful consideration to the peculiar facts and circumstances of the case. As in the instant case, the assessment order was passed u/s. 144/147 of the Act and it is the claim of the Assessee that the Assessee never received any statutory notice(s) as mentioned in the assessment order, whereas it is a fact that in the assessment order, the Assessing Officer clearly mentioned the dates of sending the notices as referred in the assessment order.

In the result, the appeal in filed by the Assessee and C.O. No. 40/Del/2020 filed by the Revenue Department stands allowed for statistical purposes.

Coming to 18.11.2016 u/s. 144/147 of the Act referred to above, after making addition of Rs.1.2 crores, the Assessing Officer also initiated penalty proceedings u/s. 271(1)(c) of the Act as well and issued statutory notice u/s. 274 on dated 21.11.2016 by which the Assessee was asked to furnish explanation by 08.12.2016 as to why an order imposing penalty u/s. 271(1)© of the Act be not made. The said notice also remained un-complied. Therefore, considering the peculiar facts of the case, the Assessing Officer imposed the penalty of Rs.40,78,800/- at the rate of 100% of the tax sought to be evaded.

In the result, the appeal No. 5758/Del/2019 filed by the Assessee and the Cross Objection No. 40/Del/2020 filed by the Revenue stand allowed for statistical purposes.