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Facts
A survey operation revealed undated donation slips totaling Rs. 90,53,600. The assessee failed to provide explanations for these donations, leading to a reassessment under Section 147 of the Income Tax Act. The Assessing Officer brought the anonymous donations to tax at 30% under Section 115BBC.
Held
The tribunal held that the notice issued under Section 148 of the Act was invalid because it was issued before the jurisdiction order under Section 127. Consequently, the assessment order passed pursuant to the invalid notice was also quashed.
Key Issues
Whether the notice issued under Section 148 was validly issued without jurisdiction, rendering the subsequent assessment order void.
Sections Cited
133A, 131, 147, 148, 143(2), 142(1), 115BBC, 127, 12AA, 12A, 11, 12
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “B” BENCH KOLKATA
(�नधा�रण वष� / Assessment Year: 2016-2017) DCIT, Circle-1(4), Kolkata Vs Uttarayan Trust For Education & Social Welfare C/o Dipankar Banik Nripendra Narayan Road, Cooch Behar- 736101. PAN No. : AAATU6023D (अपीलाथ� /Appellant) (��यथ� / Respondent) .. �नधा�रती क� ओर से /Assessee by : Shri S R Nag, AR राज�व क� ओर से /Revenue by : Shri Manoj Kr. Patil, JCIT, Sr. DR सुनवाई क� तार�ख / Date of Hearing : 04/09/2025 घोषणा क� तार�ख/Date of Pronouncement : 08/12/2025 आदेश / O R D E R
PER SONJOY SARMA, JM :
This appeal by the revenue arises against the order dated 26.07.2024 of the Commissioner of Income Tax (appeals)-20, Kolkata (hereinafter referred to as the ‘CIT(A)’) passed under section 250 of the Income-tax Act, 1961 (the ‘Act’).
The appeal has been filed by the revenue with a delay of 73 days. The revenue has filed an affidavit for condonation of the delay. After considering the reasons cited in the affidavit for condonation of delay, we find that the reasons are valid and consequently, the delay in filing the appeal is hereby condoned and we proceed to dispose of the appeal on merits.
Brief facts of the case are that a Survey operation u/s 133A was conducted at the office premises of assessee-trust on Uttarayan Trust For Education & Social Welfare 18.07.2019. During the course of survey proceedings u/s 133A of the IT Act, 1961, twenty bunches of counterfoils of undated donation slip of Uttarayan Trust for Education & Social Welfare found. The total quantum of such donation slip works out to Rs. 90,53,600/-. Further, during the course of survey proceedings u/s 133A of the Act, a list of 3028 donors was also found who have given donation to the assessee during the Financial Year 2015-16 relevant to the Assessment Year 2016-17. Thereafter, notice u/s 131 was issued and in response to summons u/s 131, the assessee has failed to provide explanation regarding donation received during the year under consideration. The assessment of the assessee was reopened u/s 147 of the Act by issuing notice u/s 148 and statutory notices u/s 143(2) and 142(1) were issued. In the absence of proper explanation by the assessee-trust regarding donation received, the Assessing Officer completed the assessment u/s 147 of the Act by considering the above anonymous donations and brought to tax u/s 115BBC @ 30% on Rs.14896000/-.
Aggrieved by the above order, the assessee filed appeal before the ld. CIT(A) wherein the appeal of the assessee has been allowed on the ground that the notice issued u/s 148 dated 14.10.2019 is without jurisdiction as the order u/s 127 of the Act was issued on 21.10.2019 and the relevant portion of the order of the ld. CIT(A) is as under:
“7.8.1 I have duly considered the Additional grounds of appeal No.4, 5, 6 & 7 of the appellant and submission made thereon. The appellant has contested the validity of issuance of summons u/s.131 and notice u/s.148 of the Act, stating that these notices have been issued by the ITO(E), Ward-2(2), Siliguri without having jurisdiction over the case. The appellant has stated that notice u/s.148 of the Act was issued on 14- 10-2019. But the jurisdiction order u/s.127 of the Act was issued vide letter Uttarayan Trust For Education & Social Welfare No.ITBA/Com/F/17/2019-20/ 1019176273(1) on 21-10-2019. The appellant further stated that the said order was neither manually nor digitally signed. Similar argument was made by the appellant regarding issuance of summon u/s.131 of the Act dated 18-07- 2019. 7.8.2 Remand report was called for from the A.O. on the Additional grounds raised by the appellant in this case. The A.O. in his remand report has commented on the additional ground No.6 where the appellant has contested the validity of notice u/s.148 of the Act. The comments of the A.O. are as under: “During the assessment proceedings the assessee did not raise any objection in this regard. The validity of the jurisdiction as per order u/s.127 are on record.” Further, in para 1(i) of its remand report dated 20- 05-2024, the A.O. has stated that PAN was migrated from ITO, Ward-2(2), Coochbihar to ITO(Exemption), Ward 2(2), Siliguri vide order u/s.127 of the Act dated 21-10-2019 by the Centralization order passed by PCIT, Siliguri. 7.8.3 I have perused the copy of the screenshot taken from ITBA portal enclosed with submission by the appellant. This screenshot shows that notice u/s.148 of the Act was issued on 14-10-2019. Further, it is also clear from the remand report of the A.O. that the Ld. PCIT, Siliguri has passed the order u/s.127 of the Act vide letter No. ITBA/Com/F/17/2019-20/1019176273(1) dated 21-10- 2019 transferring the jurisdiction of the case from ITO, Ward-2(2), Coochbihar to ITO(Exemption), Ward-2(2), Siliguri. Therefore, it is clear from the facts mentioned above that the ITO(Exemption), Ward2(2), Siliguri has issued notice u/s.148 of the I.T. Act on 14- 10-2019 vide DIN No.ITBA/ AST/S/148/2019-20/1018868573(1) without holding jurisdiction over the case. The jurisdiction of the case was transferred to him, later on vide order u/s.127 of the Act dated 21-10-2019. Hence, the notice u/s.148 of the Act issued on 14-10-2019 without jurisdiction is held as void ab initio. Further, Hon’ble Delhi High Court in the case of Gindal Photo Films Ltd. vs. Dy. CIT (1998) 234 ITR 170, 179 (Delhi) has held that if the notice u/s.148 has been issued without jurisdictional foundation under section 147 of the Act, the notice and subsequent proceeding will be without jurisdiction and liable to be struck down. 7.8.4 Hence, in view of the above facts and judicial decision as relied upon, I am of the opinion that once the notice u/s.148 of the Act has been held as invalid. The assessment order passed in pursuant to that invalid notice will also not survive. Accordingly, assessment order passed u/s.147 of the Act on 29-09-2021 is this case is quashed. Furthermore, the trust has got registration u/s.12AA vide order of PCIT(Exemption), Kolkata dated 26-02-2019 and the books of accounts including the details of donation pertaining to the year under consideration was subject to Uttarayan Trust For Education & Social Welfare examination at the time of registration of the trust u.s,12A of the I.T. Act. The Ld. PCIT (E), Kolkata has not taken any adverse view against the receipt of the donation. Hence, by virtue of proviso to section 12A(2), the appellant is eligible for the exemption of its income/donations u/s.11 and u/s.12 of the Act. Therefore, the A.O. is directed to grant the exemption u/s.11 and 12 of the Act to the assessee in this case.”
5. Dissatisfied with the above order, the revenue is in appeal before this tribunal by stating that the ld. CIT(A) was erred on holding that the Assessment order passed u/s 147 of the IT Act dated 29.09.2021 is void-ab-initio on the ground that the notice for initiation of proceedings u/s 148 of the Act was issued by the Assessing Officer without having jurisdiction over the assessee. The ld. DR stated that the while passing the impugned order, the ld. CIT(A) ignored the fact that the Assessing Officer had already assumed the jurisdiction on 25.09.2019 before the issuance of notice u/s 148 on 14.10.2019.
6. On the other hand, the ld. AR supported the order of the ld. CIT(A) and he reiterated the submission as was made before the ld. CIT(A) stating that notice u/s.148 of the Act was issued on 14- 10-2019 and it is clear from the remand report of the A.O. that the Ld. PCIT, Siliguri has passed the order u/s 127 of the Act dated 21-10-2019 transferring the jurisdiction of the case of the assessee from ITO, Ward-2(2), Cooch Bihar to ITO (Exemption), Ward-2(2), Siliguri and further it is a clear fact that the ITO (Exemption), Ward-2(2), Siliguri has issued notice u/s.148 of the Act on 14-10-2019 without holding jurisdiction over the case, therefore, the notice u/s.148 of the Act issued on 14-10-2019 is invalid. The ld. AR further submitted that the assessment order passed in pursuant to an invalid notice is also not a valid order and the same may be quashed.
Uttarayan Trust For Education & Social Welfare 7. We after hearing the rival submission of the parties and perusing the material available on record. We find that the assessee is a trust and got registration u/s 12AA vide order of PCIT (Exemption), Kolkata on 26-02-2019 and the books of accounts including the details of donation for the year under consideration was already examined at the time of registration of the trust u/s 12A of the Act. We further find that in this case, notice u/s 148 of the Act was issued on 14-10-2019 and the Ld. PCIT, Siliguri has passed the order u/s 127 of the Act on 21-10- 2019 for transferring the jurisdiction of the case of the assessee from ITO, Ward-2(2), Cooch Bihar to ITO (Exemption), Ward-2(2), Siliguri. It is important to note here that the ITO (Exemption), Ward-2(2), Siliguri has issued notice u/s.148 of the Act on 14-10- 2019 is without jurisdiction as the order u/s 127 of the Act was issued on 21.10.2019. Considering the above discussion, we do not find any infirmity in the order of the ld. CIT(A) wherein the ld. CIT(A) has categorically held that the notice u/s 148 of the Act issued on 14-10-2019 is invalid as the notice is without jurisdiction. Therefore, the appeal of the revenue is dismissed.
In the result, the appeal of the revenue is dismissed.
Order pronounced in the open court on 08/12/2025.