SMT. VIJAYA DEVI DESHLAHRA vs. PRINCIPAL COMMISSIONER OF INCOME TAX- 2

common order.

3 Petitioner has been filing income tax returns showing her residential address to be of Indore (Madhya Pradesh), as is appearing from acknowledgement of income tax returns filed along with writ petition. After giving intimation about her shifting from one State to another, the Assessing Officer at Bhilai (CG) is not having jurisdiction to issue notice under Section 148 of the Act of 1961 to petitioner. Hence impugned notice is per-se illegal and void. Referring to Section 124 of the Act of 1961 which deals with jurisdiction of Assessing Officers, he submits that petitioner is neither residing nor engaged in any business or profession within area of jurisdiction assigned to Assessing Officer, Circle-2 (1), Bhilai. Petitioner is residing in Indore (MP) and trading in shares, having investment in stock market, therefore, in the given facts of case, provisions of Section 124 (1) (b) of the Act of 1961 is attracted and Assessing Officer of the area where petitioner is residing is having jurisdiction i.e. Assessing Officer of Indore (Madhya Pradesh). Hence, the impugned notice (Annexure P-3) issued by Assessing Officer, Circle-2 (1), Bhilai 151 of the Act of 1961 from the Competent Authority is pre- condition. Unless and until there is proper sanction, notice under Section 148 of the Act of 1961 cannot be issued. The Competent Authority without properly considering material placed before it and without due application of mind, granted sanction/approval under Section 151 of the Act of 1961 by writing the word “approved'. Hence, the impugned notice issued to petitioner being not in accordance with law is liable to be quashed. In support of his contention, he places reliance upon decision of a Division Bench of High Court of Delhi dated 11.1.2017 in ITA No.335/2015 between Pr. Commissioner of Income Tax-6 Vs. M/s N.C. Cables Ltd. Referring to documents placed on record along with rejoinder as Annexure R-1, he submits that procedure for migration of Permanent Account Number (PAN) is uploaded in website of Income Tax Department, according to which, for migration of PAN from one State to another, an assessee is required to submit an application before current Assessing Officer, who shall process such application and pass necessary order for transfer of PAN to new Assessing Officer. Petitioner herein submitted application for migration of PAN on 25.3.2017 before Assessing Officer at Bhilai, which has not been processed by Assessing Officer for the reasons best known to him. Hence, the petitioner cannot be held liable in any manner.

5 In support of this submission, he refers to provisions of Section 139A of the Act of 1961 according to which an assessee is only required to give intimation about any change in his/her address or migration from one State to another State, which has been done by petitioner by submitting application with Assessing Officer. He also pointed that along with reply respondents have annexed manual sanction/approval granted by Competent Authority for issuance of notice under Section 148 of the Act of 1961 to petitioner. This sanction/approval bears date '12.5.2020' which means sanction/approval was granted after issuance of impugned notice to petitioner. Hence, on this ground alone the notice issued is liable to be quashed. Reliance is placed on the order dated 8.12.2021 passed by Bombay High Court in Writ Petition No.3597/2019, parties being Chhagan Chandrakant Bhujbal s. Income Tax Officer & ors.

6 returns are submitted by petitioner within jurisdiction of Assessing Officer, Circle-2 (1), Bhilai, which is apparent from the acknowledgement of the Income Tax return. Action by Assessing Officer is based on PAN details of petitioner available with the Department. As PAN details of petitioner show jurisdiction of Assessing Officer at Bhilai, therefore, considering records of PAN, Assessing Officer of Bhilai (CG) had proceeded to issue notice under Section 148 of the Act of 1961. Hence, it cannot be said that Assessing Officer, Bhilai had acted in illegal manner or contrary to law. He pointed out the procedure prescribed for migration of PAN is available in official website of department, according to which, an assessee is not only required to submit an application before Assessing Officer under whose jurisdiction he/she was residing prior to migration, but also before Assessing Officer within whose jurisdiction assessee is migrated and residing on the date of submission of application for migration of PAN. As per records, petitioner has not submitted any application before Assessing Officer at Indore (MP). Before the Assessing Officer, Bhilai also petitioner submitted application manually and not uploaded the same in website. For any reason, if Assessing Officer has not taken note of petitioner's application for migration of PAN, but petitioner continued to file her income tax returns online giving description in income tax return as Assessing Officer 'Circle-2 (1), Bhilai', as is evident from income tax return acknowledgement placed on record. Petitioner was well aware at the time of submission of filling details in income tax return in 7 the year 2017-18, 2018-19 & 2019-2020 that her application is not considered since 2017 in proper manner or Assessing Officer has committed some error and in official records detail of Assessing Officer is mentioned of 'Assessing Officer, Circle-2, Bhilai'. But even then prior to issuance of notice impugned, petitioner has not taken any step to pursue her application for migration of PAN. On the date of issuance of notice impugned, the jurisdiction of Assessing Officer, Bhilai is mentioned in her PAN details. In these circumstances, it cannot be said that Assessing Officer has committed any jurisdictional error in issuing notice impugned to the petitioner. He further contended that submission of learned counsel for petitioner that there is no proper sanction/approval under Section 151 of the Act of 1961, is also not sustainable. In the 'reasons to believe' recorded b Assessing Officer for initiating proceedings under Section 148 of the Act of 1961, the Assessing Officer has clearly recorded that petitioner was engaged in share trading activities to the tune of Rs.1,81,60,782/- (in WPT No.253/2021) & Rs.17,85,372/- (in WPT No.255/2021) with Banas Finance Limited, a penny stock company listed at Bombay Stock Exchange, but this income was not disclosed by petitioner in her income tax returns for the relevant assessment years, therefore, the Sanctioning Authority after considering the material placed before it by Assessing Officer along with reasons to believe, granted sanction/ approval, which cannot be said to be erroneous or without

8 application of mind. He further contended that manual sanction has been accorded on 12.5.2020 due to some technical glitch, but subsequently copy of online sanction/approval is also placed on record in which date of grant of approval is mentioned as '5.5.2020'. Impugned notice has been issued on 6.5.2020. Thus prior to issuance of impugned notice, proper sanction/approval has been obtained from competent authority. Hence, there is no procedural illegality in issuing impugned notice to petitioner.

10 from office of Assessing Officer, Circle-2 (1) Bhilai (CG) to Assessing Officer, Indore (MP). Decision of Bombay High Court in case of Harjeet Surajprakash Girotra (supra) relied upon by learned counsel for petitioner is of no help to petitioner being distinguishable on facts. That case deals with service of notice upon assessee when Assessing Officer was having knowledge about change of address, but Assessing Officer proceeded ex-parte without communication to assessee at the address available with banking companies. In such situation, High Court of Bombay set aside impugned notice and consequential order of assessment passed by Assessing Officer. Likewise, in case of Prashant Chandra (supra), the High Court of Allahabad quashed the notice under Section 143 (2) of the Act of 1961 on the ground that Assessing Officer had no jurisdiction to issue it. In that case, petitioner after shifting his place of profession from Lucknow to Delhi, had intimated about change of address, caused requisite amendment in PAN, but ignoring the aforesaid aspects of matter, Assessing Officer had proceeded to issue notice under Section 143 (2) of the Act of 1961. Hence case law relied upon by learned counsel for petitioner will not apply to the facts of present case where petitioner submitted application for migration but PAN details in official record has not been amended accordingly till the date of issuance of notice under Section 148 of the Act of 1961. 7. Coming to next submission of learned counsel for petitioner that 11 there was no proper sanction/approval on the date of issuance of notice under Section 148 of the Act of 1961. Mere mentioning the word 'approved' in the sanction/approval granted under Section 151 of the Act of 1961 in itself would not be sufficient to consider whether the sanction/approval was with proper XI, Range Bombay & ors reported in (2008) 14 SCC 218 Hon'ble Supreme Court while considering as to sufficiency of reasons to believe at the stage of issuance of notice under Section 148 of the Act of 1961 has held thus:- “3.In this case, we do not have to give a final decision as to whether there is suppression of material facts by the assessee or not. We have only to see whether there was prima facie some material on the basis of which the Department could reopen the case. The sufficiency or correctness of the material is not a thing to be considered at this stage. We are of the view that the court cannot strike down the reopening of the case in the facts of this case. It will be open to the assessee to prove that the assumption of facts made in the notice was erroneous. The assessee may also prove that no new facts came to the knowledge of the Income-tax Officer after completion of the assessment proceeding. We are not expressing any opinion on the merits of the case. The questions of fact and law are left open to be investigated and decided by the assessing authority.

12 The appellant will be entitled to take all the points before the assessing authority. The appeals are dismissed. There will be no order as to costs.”

Judge roshan/-