What did the Tribunal hold?

The Tribunal held that the assessment was framed by a non-jurisdictional AO, violating CBDT Instruction No. 1/2011. Therefore, the assessment order was considered invalid and quashed.

The assessee filed its return of income, and the assessment was framed by the ACIT, Circle 23(1), Hooghly. The assessee raised an additional ground challenging the jurisdiction of the AO due to a violation of pecuniary jurisdiction as per CBDT Instruction No. 1/2011.

What were the issues?

Whether the assessment order is invalid due to being framed by an AO without proper pecuniary jurisdiction as per CBDT instructions.

Balaka Cold Storage Pvt. Ltd… vs ACIT | ITAT Kolkata 2026

Income Tax Appellate Tribunal, “B” BENCH, KOLKATA

For Appellant: Shri Somnath Ghosh, AR

For Respondent: Shri Dipu Koley, DR

Hearing: 09.06.2026Pronounced: 16.06.2026

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 29.11.2023 for the AY 2017-18.

The assessee has raised an additional ground which reads as under:-

"FOR THAT in the facts and circumstances of the instant case, the Ld. Commissioner of Income Tax (Appeals)-N.F.A.C. acted unlawfully in not appreciating that none of the conditions precedent existed for and/or were fulfilled by the Ld. Assistant Commissioner of Income Tax, Circle 23(1).

The facts in brief are that the assessee filed the return of income on 23.10.2017, declaring total income at ₹ 6,79,259/- . The assessee is engaged in the business of running of cold storage besides having income from other sources. The case of the assessee was selected for scrutiny under Computer Assisted Scrutiny Selection (CASS). Notice u/s 143(2) and 142(1) of the Income-tax Act, 1961 (the Act) along with questionnaire were duly served upon the assessee which were

At the outset, we note that the return of income was filed by the assessee declaring total income of ₹6,79,259/-, whereas the assessment has been framed by the ACIT, Circle 23(1), Hooghly which is in violation of pecuniary jurisdiction of the CBDT instruction No.1/2011 (F. No. 187/12/2010-IT(A-1), Dated 31.01.2011. According to the said instruction, the ITO has pecuniary jurisdiction where the income is upto 20 lacs in the Metro Cities and 15 lacs in Mofussil areas whereas the DC/AC have jurisdiction above 20 lacs in Metro cities and above 15 lacs in the Mofussil areas. The said instructions reads as under:-

In the present case, the assessee filed the return of income on 23.10.2017, disclosing total income of ₹6,79,259/-. We

Similarly, the case of the assessee also find support from the decision of Hon'ble Jurisdictional High Court Calcutta in case of PCIT Vs. Mintu Das in ITAT/167/2025, IA No. GA/1/2025, GA/2/2025 vide order dated 14.01.2026, wherein it has held as under:-

“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."

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

Order pronounced on 16.06.2026.

Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 16.06.2026 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

BALAKA COLD STORAGE PVT. LTD.,HOOGHLY vs. ACIT, CIR. 23(1), HOOGHLY

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