SMT. ARUNJEET KAUR,CHANDIGARH vs. ITO-WARD-4(5), CHANDIGARH

PDF · subscribers
ITA 280/CHANDI/2021Status: DisposedITAT Chandigarh18 December 2024AY 2012-13Bench: SHRI VIKRAM SINGH YADAV (Accountant Member), SHRI PARESH M. JOSHI (Judicial Member)55 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the transfer of the assessee's case from ITO, Muktsar to ITO, Chandigarh was not in accordance with the mandatory provisions of Section 127 of the Income Tax Act, 1961. The Tribunal noted that no valid order of transfer was produced, and the transfer was initiated by the assessee's request, but the Assessing Officer at Muktsar failed to follow the due process of law under Section 127. Consequently, the notice under Section 148 issued by the ITO, Muktsar, was deemed bad in law. Furthermore, no fresh Section 148 notice was issued by the ITO, Ward 4(5) Chandigarh. The Tribunal concluded that all subsequent proceedings, including the assessment order, were void ab initio. The ratio decidendi is that a valid order of transfer under Section 127 is a prerequisite for an Assessing Officer to assume jurisdiction over a case transferred from another jurisdiction, and failure to comply renders all subsequent actions illegal. The impugned order was set aside, and the appeal of the assessee was allowed. The Tribunal did not examine other legal contentions as the foundational assessment order was void.

What were the facts?

The assessee, Smt. Arunjeet Kaur, is appealing an order for Assessment Year 2012-13. The Revenue issued a notice under Section 148 on March 27, 2019, alleging the purchase of immovable property for Rs. 59,40,000. The assessee initially filed a return on October 13, 2012, and later requested a transfer of her case from ITO, Muktsar to ITO, Chandigarh. The case was transferred to ITO, Ward 4(1) Chandigarh on May 15, 2019. The assessee filed a manual return declaring Rs. 7820 as income and Rs. 3,48,500 as agricultural income, treating it as a response to the Section 148 notice. Notices under Sections 143(2) and 142(1) were issued by the Chandigarh ITO. The assessee contended that her husband, Shri Jaspal Singh, acting as GPA holder for Mrs. Balbir Kaur (his aunt), transferred the land to her without any monetary exchange, citing Punjab custom. Affidavits and other documents were submitted. However, the Sale Deed dated July 7, 2011, indicated a payment of Rs. 59,40,000. A show-cause notice was issued on October 30, 2019, asking for the source of funds, to which no reply was filed.

What were the issues?

1. Whether the transfer of the assessee's case from ITO, Muktsar to ITO, Chandigarh was valid in accordance with Section 127 of the Income Tax Act, 1961, and if not, whether the subsequent proceedings, including the notice under Section 148, are bad in law? Assessee's Contention: The assessee argued that the transfer of the case to ITO, Chandigarh was not accompanied by a valid order under Section 127. Therefore, the notice under Section 148 issued by the ITO, Muktsar, and all subsequent proceedings by the ITO, Chandigarh, are illegal and void ab initio. The assessee relied on decisions from ITAT Raipur Bench in ITA No. 158/RPR/2017 (Sushil Kumar Agarwal Vs ITO), ITA No. 260/RPR/2023 (Sarita Jain V/s ITO), and ITA No. 111/RPR/2024 (Rina Kodwani), which emphasize the necessity of a valid transfer order under Section 127. Revenue's Contention: The judgment does not explicitly record any specific arguments from the revenue regarding the validity of the transfer or the subsequent proceedings. However, the revenue's actions in proceeding with the assessment after the transfer suggest an implicit reliance on the assumption of jurisdiction.

Which sections of the Income-tax Act were involved?

Section 253,Section 250,Section 246A,Section 148,Section 143(2),Section 142(1),Section 127

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CHANDIGARH

Before: SHRI VIKRAM SINGH YADAV & SHRI PARESH M. JOSHI,

For Respondent: Shri Vivek Vardhan, JCIT, Sr.DR
Hearing: 24.10.2024Pronounced: 18.12.2024

6.17. The impugned order is set aside and appeal of the assessee is allowed. Order pronounced on 18.12.2024. Sd/- Sd/-

(VIKRAM SINGH YADAV) ( PARESH M. JOSHI) ACCOUNTANTMEMBER JUDICIAL MEMBER “Poonam” आदेशक��ितिलिपअ�ेिषत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकरआयु�/ CIT 4. िवभागीय�ितिनिध, आयकरअपीलीयआिधकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 5. गाड!फाईल/ Guard File आदेशानुसार/ By order, सहायकपंजीकार/ Assistant Registrar

ITA 280/CHD/2021 A.Y. 2012-13 55

More judgments on Section 148

All 35,022 judgments and leading authorities on Section 148 →

Recent GST High Court judgments

Search GST case law →