MUKESH AGARWAL,HOWRAH vs. ITO, WARD 61(3),, KOLKATA

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ITA 1168/KOL/2026Status: DisposedITAT Kolkata22 July 2026AY 2019-20206 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the notice issued by the ITO was without jurisdiction as it violated CBDT Instruction No.1/2011 regarding pecuniary limits. Consequently, the assessment framed by the AO was quashed as invalid.

What were the facts?

The assessee's case was selected for scrutiny, and a notice under Section 148A(b) was issued by an Income Tax Officer who, according to CBDT instructions, lacked the pecuniary jurisdiction for the returned income. The assessment was framed by the AO, and the CIT(A) confirmed it on merits.

What were the issues?

Whether the reassessment proceedings initiated by a non-jurisdictional Income Tax Officer are valid and whether the subsequent assessment order is sustainable.

Which sections of the Income-tax Act were involved?

Section 148A,Section 147,Section 144B,Section 143(2),Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “C” BENCH, KOLKATA

For Appellant: Shri A.K. Tibrewal, AR
For Respondent: Shri Dheeraj, DR
Hearing: 14.07.2026Pronounced: 22.07.2026

Per Rajesh Kumar, AM:

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 01.01.2026 for the AY 2019-20.

2.

At the time of hearing, the ld. Counsel for the assessee pressed ground no.2 which is extracted below:-

“2. That, the very inception of the re-assessment proceedings by way of issue of notice u/s 148A(b) of the Act by the Income Tax Officer, Ward 61(3), Kolkata is without jurisdiction, illegal and void ab initio since the said ITO, Ward 61(3), Kolkata did not have any pecuniary jurisdiction, over the Assessee Company as designated by Central Board of Direct Taxes vide its Instruction No.1/2011 [F. NO. 187/12/2010-IT(A-I)], dated 31-1-2011 and in

4.

The ld. CIT (A) in the appellate proceedings, confirmed the order of the ld. AO on merit though, the legal issue was not raised before the ld. Commissioner of Income-tax (Appeals).

2.

After hearing the rival contentions and perusing the materials available on record, we find that the case of the assessee was selected under scrutiny and undisputedly, notice u/s 148A(b) of the Act was issued by ITO, Ward 61(3), Kolkata without

3.

In the present case, the assessee filed the return of income on 19.08.2019, declaring total income of ₹77,26,900/-. We note that the notice u/s 148A(b) of the Act was issued by ITO Ward 61(3) is without jurisdiction and did not have any pecuniary jurisdiction over the assessee company & the assessment framed thereby AO, NFAC in violation of the CBDT Instruction No.1/2011 (F. No. 187/12/2010-IT(A-1), Dated 31.01.2011. Therefore, the said notice has been issued by non-jurisdictional AO and thereby farming the assessment is

“We have heard Ms. Smita Das De, learned standing counsel for the appellant/revenue. Though the respondent has been served and affidavit of service filed, none appears for the respondent. The short issue which falls for consideration in the instant case is whether there is valid notice issued under Section 143 (2) of the Act for commencing the scrutiny assessment. The Tribunal has noted the facts and rendered a finding that on the date when the case was selected for scrutiny, the authority who issued the notice namely, the Income Tax Officer, Ward No.9(4), Kolkata did not have jurisdiction and the jurisdiction. was with the Deputy Commissioner of Income Tax. The following factual finding has been recorded by the Tribunal: "Therefore, the legal ground stands to be admitted and the same relates to invalid notice issued u/s. 143 (2) of the Act. It is a settled position of law that for carrying out the assessment proceedings u/s. 143 (3) of the Act, the statutory requirement of serving of valid notice u/s. 143 (2) of the Act is must and in absence thereof the subsequent proceedings become invalid. In the case of assessee, the facts are that the assessee has declared income of Rs.48,47,180/- in the e-return filed on 26.09.2012. For selecting the case for scrutiny notice u/s. 143

“We, after hearing the rival submissions of the parties and perusing the materials available on record note that the return of income of the assessee was of Rs.16,50,920/ which falls under the jurisdiction of the ITO, Ward- 28(2), Kolkata but notice u/s 143(2) of the Act was issued by ACIT, Circle-28, Kolkata and also the assessment order was duly framed by ACIT, Circle-28. Kolkata, which is clearly a violation of the jurisdictional mandate under CBDT Circular No. 1/2011 dated 31.01.2011. We note that this procedural irregularity rendered the assessment proceedings invalid and bad in law."

6.

In the result, the appeal of the assessee is allowed.

Order pronounced on 22.07.2026.

Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 22.07.2026 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT DR, ITAT, 4. 5. Guard file. BY ORDER, True Copy//

Asst. Registrar Income Tax Appellate Tribunal, Kolkata

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