ACIT CENTRAL CIRCLE 1 GUWAHATI, GUWAHATI vs. AMIT BARTER PRIVATE LIMITED, ASSAM

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ITA 186/GTY/2025Status: DisposedITAT Guwahati08 May 2026AY 2017-187 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the jurisdiction of the Bench is determined by the location of the Assessing Officer who passed the assessment order. Therefore, the Guwahati Bench lacked jurisdiction to hear the appeal.

What were the facts?

The Revenue filed an appeal and the assessee filed cross-objections, both of which were delayed. The ITAT Guwahati Bench noted that the Assessing Officer was based in Kolkata, not Guwahati.

What were the issues?

The primary issue was whether the Guwahati Bench had the territorial jurisdiction to hear the appeal when the Assessing Officer who passed the assessment order was located in Kolkata. This was based on the interpretation of Section 127 of the Income Tax Act and the Supreme Court's decision in Principal Commissioner of Income-tax vs. ABC Papers Ltd.

Which sections of the Income-tax Act were involved?

Section 124,Section 127,Section 260A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, GUWAHATI ‘DB’ BENCH AT KOLKATA

Before: SHRI SONJOY SARMA & SHRI RAKESH MISHRA

PER RAKESH MISHRA, ACCOUNTANT MEMBER:

This appeal filed by the Revenue and the cross objections filed by the assessee are against the common order of the Commissioner of Income Tax (Appeals)- Central NER, Guwahati [hereinafter referred to as Ld. 'CIT(A)'] passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for AY 2017-18 dated 30.03.2025. 1.1 The Registry has informed that the appeal is barred by limitation by 39 days. The Revenue has filed a petition for condonation of delay explaining the reasons that the Inspector of Income-tax posted in the Central Circle-1, Guwahati had been transferred to Delhi on deputation and no substitute was given to the office. Further, at the time of giving the appeal effect, a system related error occurred in the ITBA and moreover, there were more than 765 time barring assessments and 284 penalty cases pending with the office. The Revenue has requested the Bench to condone the delay due to shortage of manpower. After perusing the same, we are satisfied that the Revenue had a reasonable and sufficient cause and was prevented from filing the instant appeal within the statutory time limit. We, therefore, condone the delay and admit the appeal for adjudication.

1.

2 The Registry has informed that the cross objections filed are also barred by limitation by 59 days. The assessee has filed an affidavit for condonation of delay explaining the reasons that the delay in filing the appeal is on the part of the Accountant of the assessee. After perusing the same, we are satisfied that the assessee had a reasonable and sufficient cause and was prevented from filing the cross objections within the statutory time limit. We, therefore, condone the delay and admit the assessee’s cross objections for adjudication.

2.

The Revenue is in appeal before the Tribunal raising the following grounds of appeal:

“1. Whether, on the facts and in the circumstances of the ease and in law the Learned CIT(A) has erred in deleting the addition of Rs. 1,70,00,252/- made by the Assessing Officer which was based on information contained in monthly VAT returns filed by the assessee and submissions made by the assessee.

2.

Whether, on the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in deleting the addition Rs.6,29,70,000/- on account of cash credits in bank account, the cash credit made from ITA No(s). 186/GTY/2025 unexplained cash sales, despite the assessee’s failure to provide satisfactory evidence/documents of such cash sales.

3.

Whether, on the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in not appreciating the fact that no evidence has been placed on record by the assessee to substantiate the volume and nature of the cash sales claimed to have been made during the short festive season window.

4.

Whether, on the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in not appreciating the fact that no comparative figures from previous years were furnished by the assessee to establish its claim of business seasonality in light of the cash sales claimed to have been made.

5.

Whether, on the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in deleting the additions without duly appreciating the fact that the assessee stopped the AO from making necessary investigation/verification in respect of individual transaction by failing to furnish required purchase invoices, sales bills and complete ledgers/ registers of the purchase, sale and stock for the relevant period despite requisitions made by the AO.

6.

The appellate craves leave to add, alter, modify or amend any of the grounds of appeal during the course of proceedings before the Hon’ble ITAT.”

2.

1 The assessee has filed cross objections as under:

“1. For that the assessment order is bad in law as same has been passed by non juri ictional Assessing Officer in view of section 124(1)(a).

2.

For that under the facts & circumstances of the ease the learned CIT(A) was justified in granting relief of Rs. 1,70,00,252/- u/s 69 and Rs.6,29,70,000/- u/s 68 of I.T. Act, 1961. 3. The Appellant craves the leave to take Additional Grounds and OR amend the above grounds of appeal at the time of hearing of Appeal.”

3.

Rival contentions were heard and the record and the submissions made have been examined. However, it was noted by the Bench that the appeal is not maintainable since the assessment order was passed by the Asstt. Commissioner of Income-tax, Circle 3(1), Kolkata being the Assessing Officer (hereinafter referred to as Ld. 'AO') stationed at Kolkata and in view of the decision of Hon'ble Supreme Court in the ITA No(s). 186/GTY/2025 case of Principal Commissioner of Income-tax vs. ABC Papers Ltd. [2022] 141 taxmann.com 332 (SC)/[2022] 289 Taxman 150 (SC)/[2022] 447 ITR 1 (SC)[18-08-2022] the appeal ought to have been filed before the Kolkata Bench as the juri iction is decided by the location of the Ld. AO who passed the assessment order. It was conveyed to the Ld. AR as well as the Ld. DR that the appeal as well as the cross objections should have been filed before the Kolkata Bench of the Tribunal. It has been held in ABC Papers Ltd. (supra) as under in this case: ■ Section 127 occurs in Chapter XIII of the Act which relates to Income-tax Authorities. In the same chapter, section 116 enlists the Income-tax Authorities and section 120 specifies the juri iction of such Authorities. While section 124 specifically speaks of the juri iction of Assessing Officers, section 127 enables a higher authority to transfer a 'case' from one Assessing Officer to another Assessing Officer. All these provisions in Chapter XIII only relate to the executive or administrative powers of Income-tax Authorities. The vesting of appellate juri iction has no bearing on judicial remedies provided in Chapter XX of the Act before the Tribunal and the High Court. The mistake committed by the High Court was in assuming that the expression "case" in the Explanation to sub- section (4) of section 127 has an overarching effect and would include the proceedings pending before the Tribunal as well as a High Court. This fundamental error has led the Division Bench of the High Court of Delhi to come to a conclusion that an order of transfer made under section 127 would have the effect of transferring the case "lock, stock and barrel" not only from the juri iction of the Tribunal, but also from that of the High Court in which the Assessing Officer was located, and vest it in the High Court having juri iction over the situation, as the erroneous principle adopted by the authority or the Tribunal, even if corrected by the High Court outside its juri iction, would not be binding on them. [Para 29] ■ The legal structure under the Income-tax Act commencing with Assessing Officer, the Commissioner of Appeals, Tribunal and finally the High Court under section 260A must be seen as a lineal progression of judicial remedies. Culmination of all these proceedings in question of law juri iction of the High Court under section 260A of the Act is of special significance as it depicts the overarching judicial superintendence of the High Court over Tribunals and other Authorities operating within its territorial juri iction.[Para 30] ■ The power of transfer exercisable under section 127 is relatable only to the juri iction of the Income-tax Authorities. It has no bearing on the Tribunal, much less on a High Court. If the submission are accepted, it will have the effect of the executive having the power to determine the juri iction of a High Court. This can never be the intention of the Parliament. The juri iction of a High Court stands on its own footing by virtue of section 260A read with section 269. While interpreting a judicial remedy, a Constitutional Court should transferee Assessing Officer. This erroneous interpretation was in fact advanced before other High Courts as well, but they were rejected straightaway.[Para 26] ■ The binding nature of decisions of an appellate court established under a statute on subordinate courts and tribunals within the territorial juri iction of the State, is a larger principle involving consistency, certainty and judicial discipline, and it has a direct bearing on the rule of law. This 'need for order' and consistency in decision making must inform our interpretation of judicial remedies. An important reason adopted in the case of Seth Banarasi Dass Gupta v. CIT [1978] 113 ITR 817 (Delhi), further highlighted by Justice Lahoti in Suresh Desai & Associates v. CIT [1998] 99 Taxman 114/230 ITR 912 (Delhi), is that a decision of a High Court is binding on subordinate courts as well as tribunals operating within its territorial juri iction. It is for this very reason that the Assessing Officer, Commissioner of Appeals and the Tribunal operate under the concerned High Court as one unit, for consistency and systematic development of the law. It is also important to note that the decisions of the High Court in whose juri iction the transferee Assessing Officer is situated do not bind the Authorities or the Tribunal which had passed orders before the transfer of the case has taken place. This creates an anomalous not adopt an approach where the identity of the appellate forum would be contingent upon or vacillates subject to the exercise of some other power. Such an interpretation will clearly be against the interest of justice. Under section 127, the authorities have the power to transfer a case either upon the request of an assessee or for their own reasons. Though the decision under section 127 is subject to judicial review or even an appellate scrutiny, this Court for larger reasons would avoid an interpretation that would render the appellate juri iction of a High Court dependent upon the executive power. As a matter of principle, transfer of a case from one judicial forum to another judicial forum, without the intervention of a Court of law is against the independence of judiciary. This is true, particularly, when such a transfer can occur in exercise of pure executive power.[Para 31] ■ In conclusion, appeals against every decision of the Tribunal shall lie only before the High Court within whose juri iction the Assessing Officer who passed the assessment order is situated. Even if the case or cases of an ITA No(s). 186/GTY/2025 assessee are transferred in exercise of power under section 127, the High Court within whose juri iction the Assessing Officer has passed the order, shall continue to exercise the juri iction of appeal. This principle is applicable even if the transfer is under section 127 for the same assessment year(s). [Para 33]

4.

Thus, the location of the assessing officer who passed the order shall decide the juri iction of the Bench of the Tribunal before which the appeal could be filed. Therefore, the appeal is dismissed on account of lack of juri iction as the Guwahati Bench does not have the juri iction to decide the appeal when the Assessing Officer is in Kolkata. The assessee will be at liberty to file an appeal before the appropriate Bench along with an application seeking condonation of delay.

5.

Since the appeal has been dismissed on account of lack of juri iction, therefore, the cross objections filed by the assessee are also dismissed accordingly since the same ought to have been filed before the Kolkata Bench of the Tribunal.

6.

In the result, both the appeal filed by the Revenue in ITA No. 186/GTY/2025 and the cross objections filed by the assessee in CO No. 6/GTY/2025 are dismissed. Order pronounced in the open Court on 8th May, 2026. [Sonjoy Sarma] [Rakesh Mishra] Judicial Member Accountant Member Dated: 08.05.2026 Bidhan (Sr. P.S.)

Copy of the order forwarded to:

1.

ACIT, Central Circle-1 Guwahati.

2.

Amit Barter Private Limited, 1st Floor, Shoppers Point, H B Road, Fancy Bazaar, Guwahati, Assam, 781001. 3. CIT(A)-Central NER, Guwahati.

4.

CIT-

5.

CIT(DR), Guwahati Benches, Guwahati.

6.

Guard File. //// By order

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