NEEL CONSTRUCTIONS,NAVI MUMBAI vs. DEPUTY COMMISSIONER OF INCOME TAX, PANVEL CIRCLE, PANVEL

2.2 Because, the Ld. CIT(A) has erred in ignoring the plethora jurisdictional authorities referred to.

3. Because, the ld. CIT(A) has erred in holding that the Appellant had offered the income under the head “business income”

3 | P a g e Neel Constructions for the purpose of obtaining unjustified advantage, ignoring the copious argument put up and authorities referred to in support of the classification of income made by the Appellant.

In AY 2010-11

2.1 Because, the Ld. CIT(A) has erred in law and on facts in sustaining the levy of penalty under section 271(1)(c) of the extent of tax due on ₹12,47,223/-.

2.2 Because, the ld. CIT(A) has erred in ignoring the plethora jurisdictional authorities referred to.

4 | P a g e Neel Constructions 3. At the outset, the learned Counsel for the assessee stated that the assessments in both the years has been quashed by Tribunal in vide ITA No. 7049 & 2050 /Mum/2014 for AY 2009- 10 and 2010-11 respectively, vide order dated 23.09.2019. She referred that for AY 2009-10 in ITA No. 7049/Mum/2014, the Tribunal quashed the order vide Para 7 as under: - “7. On the issue of applicability of section 124(3) of the Act, we noted that the said section applies where jurisdiction is to be decided by virtue of section 120 of the Act. As per section 124(1) of the Act the jurisdiction on basis of section 120 of the Act is to he challenged within 30 days. However, the instant ease is under section 127 of the Act. In this case the Jurisdiction as transferred u/s 127 of Act before CIT-Central Circle-Thane. In accordance with said transfer order, the DCIT-CC- Thane initiated assessment proceedings for AY 2008-09. However, subsequently ITO Ward-2, Panvel initiated assessment proceedings for AY 2009-10 before obtaining an order u/s 127 of the Act decentralizing the change of the assessee. The Ld. Counsel relied on decision of Delhi High Court in the case of Valvoline Cuminus Ltd vs DCIT (2008)

5 | P a g e Neel Constructions 307 ITR 103 (Del.) to submit that once the proper officer exercised the jurisdiction, the subsequent notice by an officer not so authorized is invalid. In view of this discussion, we are of the view that notice issued under section 143(2) of the Act is without jurisdiction. As regards to the one argument of the DR that the returned filed by the assessee was with ITO Ward-2, Panvel is of no consequence because under e-filing system for filing of return, the automatic return will go to the territorial ITO of the assessee and not to the proper jurisdiction where the case is transferred under section 127 of the Act. Hence, this argument will not stand. This issue of the assessee’s appeal is allowed. Once, the issue on jurisdiction is decided in favour of assessee and notice under section 143(2) is quashed, consequential assessment will not stand. Hence, we quash the assessment order and allow the appeal of the assessee.”

6 | P a g e Neel Constructions “11. Before us, the learned Counsel for the assessee argued that on a combined reading of the notification and order it is clear that ACIT Panvel acquired jurisdiction on the assessee’s case with effect from 20.05.2011. Thus the original notice u/s 143(2) of the Act was without jurisdiction, rendering the assessment order null & void. The notice dated I 7.01.2012 issued by ACIT was time barred, so no cognizance can he taken of the same. She further argued that regarding departments contention that objection was not taken within a month as per section 124(3) of the Act, it is stated that the jurisdiction was vested in the ACIT w.e.f. 20.05.2011 vide the order u/s 127 of the Act and notification, the ITO had no role to play. Thus, section 124 of the Act is not attracted in this case. In case the department argues that the jurisdiction lay with ITO, then also its case fails since there is no order under section 127 of the Act transferring jurisdiction from ITO to ACIT, from whom it was further transferred to JCIT vide order under section 127 of the Act, who finally passed the assessment order.”