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Income Tax Appellate Tribunal, DELHI BENCH “B” NEW DELHI
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B” NEW DELHI BEFORE SHRI S.V. MEHROTRA : ACCOUNTANT MEMBER AND SHRI A.T. VARKEY: JUDICIAL MEMBER Asstt. Yr: 2009-10 ACIT, Circle-47(1), Vs. Akhilesh Aggarwal, New Delhi. 40, Memorial Hwy Apartment, 20N, New Rochelle, New York-10801 (Local Address: M-46, Greater Kailash-I, New Delhi) PAN: ACUPA 44496 Q ( Appellant ) (Respondent) Appellant by : Ms. Rekha Vimal DR Respondent by : Shri R.S. Singhvi CA & Sh. Satyajit Goel CA Date of hearing : 02/02/2016. Date of order : 22/02/2016. O R D E R PER S.V. MEHROTRA, A.M:
This is Revenue’s appeal against the order dated 8.4.2013 passed by the ld. CIT(A)-XXX, New Delhi in appeal no. 3469/11-12, relating to A.Y. 2009-10. 2. Brief facts of the case are that the assessee had filed return of income declaring total income of Rs. 10,63,970/- The case was selected for scrutiny through CASS system/ AIR information. As per the information, the assessee had made payment of Rs. 33,64,665/- towards various credit cards as under:
Rs. 2,00,870/- Against Citi Bank NA 2. Rs. 5,01,270/- Against Dentsche Bank Kodak House 3. Rs. 16,31,506/- Against Citi Bank, NA 4. Rs. 3,41,600/- Against City Bank NA 5. Rs. 3,06,000/- Against Deutsche Bank, Kodak House 6. Rs. 3,83,419/- Against ABN Amro Total Rs. 33,64,665/-
As assessee did not file any explanation with supporting documents, the AO made addition of Rs. 33,64,665/- u/s 69C.
Ld. CIT(A) allowed the assessee’s appeal on 2 counts, viz. – (i) The ITO Ward 1(1), Gurgaon was not empowered to transfer the jurisdiction of the case to DCIT Circle 47(1), New Delhi as no order u/s 127 was passed and, hence, the assessment order passed by DCIT Circle 47(1), New Delhi, was without jurisdiction; and (ii) The payments of credit cards were from explainable source of income i.e. assessee’s salary and his brother’s partnership firm M/s 4 Genius Minds, who had used the credit cards and paid from the partnership firm. He further noted that the assessee was working in USA and settled there.
Being aggrieved, the department is in appeal before us and has taken following grounds of appeal:
“On the facts and in the circumstances of the case and in law, the Ld. CIT{A} has erred in:
1. 1. Quashing the order passed U/s 144 on the ground that the jurisdiction over the case was not transferred by passing order U/s 127 whereas the fact that the PAN of the assessee was lying with the ACIT, Cir.47{1}, New Delhi.
1. Allowing the appeal of the assessee without providing an opportunity to put forth the view point of the Department {by calling remand report} and admitting the additional Evidences under rule 46A of the I.T.Act, 1962 without providing opportunity to AO as required under sub rule 3 of rule 46.
3. Deleting the addition of Rs.33,64,655/- made by the AO on account of investment Through credit cards U/s 69C by holding that the transaction in respect of payment made on account of credit cards as genuine ad legitimate without considering the fact that the assessee has not filed any iota of evidence during the course of assessment proceedings.
4. The appellate craves the right to alter, amend, add or substitute the grounds of appeal
.”
6. Ld. DR referred to page 4 of the paper book wherein the letter from ITO Ward 1(1), Gurgaon to DCIT Circle 47(1) dated 18/23.11.2011 is contained and pointed out that the case was transferred to DCIT Circle 47(1), New Delhi on the basis of details in PAN data base as per which the jurisdiction lay with DCIT Circle 47(1), New Delhi. She submitted that under such circumstances, there was no requirement of passing order u/s
127. On merits, ld. DR submitted that CIT(A) wrongly accepted the additional evidence and deleted the addition without affording opportunity to AO.
7. Ld. counsel for the assessee relied on the order of CIT(A) and referred to pages 5 to 9 of the paper book, wherein the department’s instructions regarding filing of return are contained, in which it is, inter alia, stated as under: “Whether the address given in the PAN card is to be quoted or the current address which may be different from the PAN card address can also be quoted? Answer: The assessee has to quote the current address on the return forms.”
8. He, therefore, submitted that without fulfilling the requirement contained u/s 127, the case could not be transferred from the jurisdiction of one Commissioner to the other Commissioner. On merits ld. counsel submitted that returned income of assessee was Rs. 10 lacs and odd and the payments had been made through cheques from explainable sources of income, which ld. CIT(A) has considered and then deleted the addition.
We have considered the rival submissions and perused the record of the case. As far as the jurisdiction for passing the assessment order by ACIT, Circle 47(1) is concerned, we find that original notice u/s 143(2) was issued by ACIT Circle 1(1), Gurgaon on 25.8.2010 at the address of the assessee given in the return of income, which was of Gurgaon, as is evident from the copy of acknowledgement contained at page 3 of PB, wherein the address given is as under:
“31A, Sector-18, Udyog Vihar, Gurgaon (Haryana).”
Ld. CIT(A) has also pointed out that ITO Ward 1(1) noted in the notices dated 8.6.2011 and 26.8.2011 that the jurisdiction of the case of the assessee lay with ITO Ward 1(1), Gurgaon as per Instruction no. 1/2011 dated 31.1.2011 issued by the CBDT and also in view of order of Commissioner bearing no. F. No. CIT/FBD/Jurisdiction/2011-12/850-73 dated 13.05.2011. Therefore, jurisdiction primarily was with ACIT Circle 1(1), Gurgaon. The address given in PAN cannot decide the jurisdiction of AO. In this regard we may refer to section 120 which deals with jurisdiction of AO. The jurisdiction of AO u/s 120 is decided primarily on the basis of following criteria: (a) Territorial area; (b) Persons or classes of persons; (c) Income or classes of income; and (d) Cases or classes of cases.
None of these criterias gives the criteria of PAN data base. Therefore, merely on the basis of PAN data base, the jurisdiction of AO cannot be decided. In the present case admittedly the assessee had filed the return giving Gurgaon address and, therefore, on the basis of territorial area, the jurisdiction lay with ACIT Circle 1(1), Gurgaon. This jurisdiction could not be transferred to DCIT Circle 47(1), New Delhi without the order being passed u/s 127, as per which the Commissioner has to provide a reasonable opportunity of being heard to the assessee and record his reasons before the case is transferred to the jurisdiction of another Commissioner, We, therefore, are in agreement with the findings of ld. CIT(A) that the assessment order passed by AO of Circle 47(1), New Delhi was without jurisdiction, hence the order is bad in law. Ground no. 1 is dismissed. 12. As we have confirmed the finding of ld. CIT(A) in quashing the assessment order, there is no need to go into the merits of the case and, therefore, ground nos. 2 and 3 raised by the department have become infructuous. Ground no. 4 is general in nature.
In the result, department’s appeal is dismissed. Order pronouncement in open court on 22/02/2016.