CHENNA NARAYANA CHAKKA,HYDERABAD vs. ITO, WARD 6(1), HYDERABAD

ITA 1944/HYD/2025Status: DisposedITAT Hyderabad30 September 2026AY 2014-1520 pages
AI SummaryAllowed

What were the facts?

The assessee, Chenna Narayana Chakka, is appealing against two orders of the CIT(A)-11, Hyderabad, dated 19.09.2025 and 20.09.2025, for assessment years 2013-2014 and 2014-2015 respectively. The appeals challenge the validity of assessment orders passed by the ITO, Ward-1, Chirala, on grounds of lack of jurisdiction. The assessee contends that he has been filing returns in Hyderabad since 2007-08 with ITO, Ward-6(1), Hyderabad, and no order under Section 127 of the Income Tax Act was passed to transfer jurisdiction. A survey under Section 133A was conducted on 11.02.2013 at the assessee's residential premises in Chirala, which the assessee argues was unauthorized and invalid due to jurisdictional issues and defects in the authorization. The revenue argues that the assessee is a resident of Chirala, and filing returns in Hyderabad was a device to avoid disclosure of undisclosed income, asserting that the ITO, Chirala, had territorial jurisdiction.

What did the Tribunal hold?

The Tribunal held that the assessment orders passed by the ITO, Ward-1, Chirala, for both assessment years 2013-2014 and 2014-2015 are invalid due to a lack of jurisdiction. The Tribunal reasoned that the assessee had consistently filed returns with the ITO, Ward-6(1), Hyderabad, and the department had not issued any order under Section 127 of the Income Tax Act transferring the case to Chirala. Therefore, the ITO, Chirala, had no jurisdiction to conduct the survey or pass the assessment orders. The Tribunal also addressed the revenue's contention regarding Section 124(3), stating that this provision, which bars raising jurisdictional objections after assessment completion, does not validate an order passed by an officer who inherently lacks jurisdiction. The Tribunal found that the assessment order passed by an officer without jurisdiction is invalid, irrespective of whether the assessee raised an objection under Section 124(3). Consequently, the other grounds raised by the assessee were not adjudicated as the primary issue of jurisdiction was decided in favor of the assessee. The assessment orders were set aside.

What were the issues?

1. Whether the assessment orders passed by the ITO, Ward-1, Chirala, for assessment years 2013-2014 and 2014-2015 are invalid due to lack of jurisdiction, considering the assessee has been filing returns with ITO, Ward-6(1), Hyderabad, and no order under Section 127 was passed. - Assessee's contention: The ITO, Chirala, lacks jurisdiction as the assessee resides and files returns in Hyderabad. The survey conducted at residential premises and the subsequent assessment are invalid. Reliance is placed on ITAT Hyderabad decisions in Shri Siddapuram Nagaraj vs. ITO and Satyanarayana Murthy Adapa vs. ITO, among others. - Revenue's contention: The assessee is a resident of Chirala, and filing returns in Hyderabad is a devise to avoid undisclosed income. The ITO, Chirala, has territorial jurisdiction. The assessee did not raise objections to jurisdiction during assessment proceedings, thus barred by Section 124(3). 2. Whether the survey conducted under Section 133A on 11.02.2013 at the assessee's residential premises in Chirala is invalid, and if so, whether it invalidates the subsequent scrutiny notice under Section 143(2). - Assessee's contention: The survey is invalid as it was conducted at a residential premise, violating Section 133A, and the authorization was defective (lacked official seal and date). This invalidates the subsequent Section 143(2) notice. - Revenue's contention: (Not explicitly recorded on this specific point, but impliedly supports the validity of the survey and subsequent assessment by asserting jurisdiction).

Which sections of the Income-tax Act were involved?

Section 133A,Section 143(2),Section 127,Section 124(3),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD

Before: SHRI VIJAY PAL RAO

Pronounced: 30.09.2026

This appeal by the Assessee is directed against two separate Orders dated 19.09.2025 and 20.09.2025 of the learned CIT(A)-11, Hyderabad, for the assessment years 2013-2014 and 2014-2015 respectively.

ITA.No.1943/Hyd./2025 – A.Y. 2013-2014:

2.

The Assessee has raised the following grounds of appeal:

“The order of the CIT(A) passed u/s 250 of the Act dated 1) 19.09.2025 is erroneous both on facts

The order continues below.

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