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Facts
The assessee did not file a return of income for AY 2013-14. The AO reopened the case under section 147, noticing the sale of immovable property and investment in bonds and debentures. A reassessment order was passed under section 144 r.w.s. 147.
Held
The CIT(A) set aside the AO's order and remanded the case back for fresh assessment without deciding the jurisdictional and legal grounds raised by the assessee. The Tribunal, relying on previous judgments, held that the CIT(A) should have decided these grounds first.
Key Issues
Whether the CIT(A) erred in remanding the case back to the AO without deciding the jurisdictional and legal grounds raised by the assessee.
Sections Cited
147, 144, 148, 151, 127, 251(1)
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Before: SHRI SIDDHARTHA NAUTIYAL & SHRI BIJAYANANDA PRUSETH
आदेश / O R D E R
PER BIJAYANANDA PRUSETH, AM:
This appeal by the assessee emanates from order passed under section 250 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 13.11.2024 by the National Faceless Appeal Centre, Delhi/ Commissioner of Income-tax (Appeals), [in short, “NFAC/CIT(A)”] for assessment year (AY) 2012- 13, which in turn arises out of the re-assessment order passed by Assessing Officer (in short, “AO”) u/s 144 r.w.s. 147 of the Act 14.12.2019.
2. Grounds of appeal raised by the assessee are as under:
A.Y 12-13 Arunkumar Gupta 1. That the Ld.CIT(A) has erred in law and on facts in setting aside the assessment order passed under section 147 r.w.s. 144 issued by the Ld. AO without adjudicating the legal grounds in the appellant’s case taken before CIT(A).
2. That the reasons have been recorded by the Ld. ITO-3(1), Surat and also, notice under section 148 of the Income Tax Act, 1961 was issued by him ignoring the fact that he was not having jurisdiction over the appellant therefore, the impugned reassessment order is void-ab-initio and liable to be quashed.
That the Pr.CIT, Surat has given mechanical approval/satisfaction and such satisfaction cannot be said to be in accordance with section 151 of the Income Tax Act, 1961, therefore, the impugned assessment order is void-ab-initio and liable to be quashed.
That the Ld. Assessing Officer, Surat, recorded vague reasons and these are based on incorrect facts, surmises, conjectures, assumptions, therefore there is no valid assumption of jurisdiction by the Ld. AO to initiate proceedings under section 147 of the Income Tax, Act, 1961 and consequently impugned reassessment order is void-ab-initio and liable to be quashed.
5. That the case was suo motu transferred fromItO-3(1), Surat to ACIT- 3(2), Surat without there being any order under section 127 of the Income tax, Act, 1961 therefore the impugned reassessment order is illegal, void ab initio and liable to be quashed.
That the Ld. ITO-3(1), Surat has erred in law and on facts in assuming jurisdiction to issue notice under section 148 of the Income Tax Act, 1961, ignoring the fact that the appellant address in PAN data base as that of Mumbai and which was available with ITO-3(1), Surat and ACIT, Circle-2(2), Surat therefore, the impugned reassessment order is void- ab-initio and liable to be quashed.
7. That the Ld. ACIT-3, Surat, has erred in law and on facts in assuming jurisdiction to pass the impugned assessment order ignoring the fact that he was not having jurisdiction over the appellant, therefore the impugned reassessment order is void-ab-initio and liable to be quashed. 8. 8.1 That the impugned reassessment order does not contain any date and DIN therefore, the same is non est, illegal and void-ab-initio and liable to be quashed A.Y 12-13 Arunkumar Gupta 8.2. That the Ld.A.O has erred in law in not passing the original assessment order and providing only the draft assessment order, therefore, the impugned reassessment order is void ab-initio and liable to be quashed. 9.1 That the impugned reassessment order was e-mailed on 10.01.2020, therefore, the impugned reassessment order is barred by limitation and is void ab-initio and liable to be quashed. 9.2 That the Ld. AO has erred in law and on facts in passing the reassessment order without giving reasonable opportunity of being heard, therefore the impugned reassessment order is void ab-initio and liable to be quashed.
That any other relief or reliefs as may be deemed fit on the facts on record, be granted.”
Facts of the case in brief are that assessee had not filed his return of income for AY 2013-14. The AO noticed from the details in the ITD system that the assessee had sold immovable property of Rs.96,00,000/- and invested Rs.33,25,000/- in bond and debentures during the year under consideration. Accordingly, the case was reopened u/s 147 of the Act after recording reasons and obtaining prior approval of Ld.PCIT-3, Surat and notice u/s 148 was issued on 29.03.2019. But, the assessee did not file return in response to notice u/s 148 of the Act. The AO, thereafter, completed the re-assessment determining total at Rs.81,25,000/- u/s 144 r.w.s. 147 of the Act on 14.12.2019.
3. Aggrieved by the order of the AO, assessee filed appeal before CIT(A) wherein he had raised fifteen grounds of appeal
including various jurisdictional and legal grounds on the issue of reopening u/s 147 by issue of notice u/s 148 of the Act. The CIT(A) condoned the delay of 34 days in filing the appeal. Thereafter, he has given his findings at para-6 to 8 of the appellate order. He observed that the AO passed his best judgment order u/s 144 of the Act and, A.Y 12
13. Arunkumar Gupta therefore, appellant did not have reasonable opportunity to present his case before AO. Thereafter, he referred to the provisions of the amended section 251(1) of the Act w.e.f. October 1, 2024 which empowers the CIT(A) to set aside an assessment order u/s 144 of the Act and refer the case back to the AO for fresh assessment. Accordingly, the order passed u/s 144 of the Act was set aside to AO for fresh assessment after providing adequate opportunity of being heard to the appellant.
4. Aggrieved by the order of CIT(A), appellant filed present appeal before the Tribunal. The Ld. AR of the assessee submitted that the appellant has no taxable income and hence no return of income was filed. The AO passed order u/s 144 r.w.s. 147 of the Act. In the appeal before CIT(A), the appellant had filed written submission and additional evidence. The statement of facts, grounds of appeal and submission of the appellant have been reproduced in the appellate order. However, the CIT(A) simply set aside the order of AO and remanded the matter back to the file of AO without deciding the jurisdictional and legal grounds raised by the appellant. The Ld. AR relied on the decisions in the cases of (i) Eyegear Optics India Pvt. Ltd. vs. DCIT in and 1291/Hyd/2024 dated 14.05.2025 and (ii) Shamrao Gopal Benake vs. ITO in dated 12.08.2025 and requested to set aside the impugned order of CIT(A) with a direction to decide the jurisdictional grounds.
On the other hand, Ld. Sr. DR for the Revenue supported the order of lower authorities.
A.Y 12-13 Arunkumar Gupta 6. We have heard both the parties and perused the materials available on record. We have also deliberated on the decisions relied upon by Ld. AR of the appellant. It is an undisputed fact that the appellant had raised fifteen grounds of appeal before the CIT(A) which includes jurisdictional and legal issues on validity of reopening and issue of notice u/s 148 of the Act. Such grounds are at serial Nos.1 to 7 of the grounds of appeal before CIT(A). The CIT(A) has not decided the jurisdictional and legal grounds and has simply set aside the order of AO and referred the case back to AO for making a fresh assessment. The Co- ordinate Benches of Hyderabad in case of Eyegear Optics India Pvt. Ltd. (supra) held that where assessment was reopened in case of assessee u/s 147 of the Act and was completed u/s 144 disallowing some expenditures, the CIT(A) instead of summarily setting aside matter to the file of AO for making fresh assessment, ought to have taken a call as regards specific ground based on which validity of jurisdiction that was assumed by AO or framing reassessment was assailed by assessee before him. The Tribunal set aside the order of CIT(A) and restored the matter to his file with a direction to adjudicate the specific jurisdictional ground. Further, under similar facts and circumstances of the case, the Pune Tribunal in the case of Shamrao Gopal Benake (supra) has also set aside the order of CIT(A) and remanded the matter back to the his file with a direction to decide the appeal afresh adjudicating all the grounds including legal grounds raised by the assessee. The facts of the instant appeal are similar to the facts of the cases cited supra. We do not find A.Y 12
13. Arunkumar Gupta any reason to deviate from the findings of the co-ordinate Benches (supra). Therefore, we set aside the order of CIT(A) and remand the matter back to his file with a direction to decide the appeal afresh by adjudicating of the grounds including the jurisdictional and legal grounds raised by the appellant before him after providing reasonable opportunity of being heard to assessee. Accordingly, appeal of assessee is allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced in accordance with Rule 34 of ITAT Rules, 1963 on 21/08/2025 in the open court.