BHAVIN PARIKH,VADODARA vs. THE ITO, WARD-2, GODHRA

The captioned appeal has been filed at the instance of the assessee against the order of the Commissioner of Income Tax (Appeals)-4, Vadodara (‘CIT(A)’ in short), dated 26.06.2017 arising in the assessment order dated 29.02.2016 passed by the Assessing Officer (AO) under s. 144 r.w.s. 147 of the Income Tax Act, 1961 (the Act) concerning AY 2010-11.

The grounds of appeal raised by assessee read as under:

The assessee has also filed additional ground challenging the jurisdiction assumed under s.147 of the Act which reads as under:

The learned DR, on the other hand, submitted that the issue raised in the additional ground towards legality of jurisdiction has not been examined by the lower authorities and therefore it will not be proper for the Tribunal to examine the issue for the first time without taking cognizance of the observations of the lower authorities on this score.

As noted above, the assessee has challenged the validity of assumption of jurisdiction under s.147 of the Act. It is noticed that the issue was neither raised before the AO nor before the CIT(A). It is however well settled that the provision which confers the jurisdiction for assessment and re-assessment could never be waived for the simple reason that the jurisdiction could neither be waived nor created by consent. The Tribunal is thus not prevented from considering the question of law towards jurisdiction although not raised earlier. The question of inherent lack of jurisdiction to re-open a case goes to the root of the matter and substantially affects the rights of the assessee if the illegal proceeding on the basis of wrongful usurpation of jurisdiction is allowed to continue. It thus appears to us that the assessee is entitled to plead lack of jurisdiction for the first time before the Tribunal. We however in the same vain observe that the pros and cons of the objections of the assessee with regard to jurisdiction requires to be examined by the Revenue authorities to enable us to take an informed view on the issue. We thus consider it expedient to restore the issue towards lack of jurisdiction to the file of the CIT(A). It shall be open to the assessee to raise the objections in connection with the assumption of jurisdiction under s.147/148 of the Act. The CIT(A) shall examine the legality of assumption of jurisdiction in accordance with law and pass a speaking order in this regard.

We also simultaneously notice that the CIT(A) has dismissed the appeal by a very brief order without examine the appeals on merit. The [Bhavin Parikh Vs. ITO] A.Y. 2010-11 - 4 - CIT(A) is expected to confirm to the requirement of provisions of Section 250(6) of the Act while disposing the appeal of the assessee. As the issue of jurisdiction has been remitted back to the file of the CIT(A), we also consider it expedient to set aside the order of the CIT(A) on merits and restore the issues raised before the CIT(A) on merits once again to the file of the CIT(A) for de novo examination after granting reasonable opportunity to the assessee and after making or cause to make such enquiry as may be considered necessary for adjudication on merits. Consequently, the order of the CIT(A) is set aside and all issues are remitted back to the file of the CIT(A) for determination in terms of directions noted above and in accordance with law.

In the result, the appeal of the assessee is allowed for statistical purposes.