The jurisdiction of the Assessing Officer is established based on the business location and not solely on the residential address, barring objections under Section 124(3)(a) if not timely raised.

JUDGMENT :

Sanjay K. Agrawal, J.

1. Invoking the appellate jurisdiction of this Court under Section 260A of the Income Tax Act, 1961 (for short, ‘the IT Act’), the appellant herein/assessee has preferred this appeal questioning legality, validity and correctness of the order dated 12-12-2022 passed by the Income Tax Appellate Tribunal, Raipur Bench, Raipur in ITA No.323/RPR/2016 by which the appellant’s statutory appeal has been dismissed by the ITAT finding no merit.

2. The aforesaid appeal preferred by the appellant/assessee was admitted for hearing by this Court on 29-8-2025 by formulating the following substantial question of law: -

“Whether the ITAT was justified in upholding the validity of assessment under Section 143(3) based on a notice under Section 143(2) issued by the non-jurisdictional Assessing Officer, solely relying on the address in the PAN?”

3. The aforesaid substantial question of law arises on the following factual backdrop: -

4. The appellant herein/assessee is engaged in the business of trading in electrical goods under the name and style of M/s. Sona Agency situated at Street of Dena Bank, Jawahar Nagar, M.G. Road, Raipur. The appellant/assessee filed his return of income for the assessment year 2012-13 electronically on 17-9-2012 with ITO, Ward-1(2), Raipur, declaring total income of Rs.2,96,390/- and in the PAN database, at that time, his residential address was shown as House No.490, Nearly Railway Line, Sachdeva Nursing Home Gali, Samta Colony, Raipur, Chhattisgarh. The said residential address determines the assessee’s territorial jurisdiction. Accordingly, on 8- 8-2013, on the basis of the aforesaid PAN address, ITO, Ward-1(1), Raipur, who had jurisdiction over Samta Colony, Raipur, issued notice to the assessee under Section 143(2) of the IT Act dated 8-8- 2013, duly served on him on 21-8-2013. Thereafter, on 25-8-2014 and 12-12-2014, notices under Sections 143(2) and 142(1) of the IT Act, respectively, were issued to the assessee, during the course of scrutiny, continuing the same line of jurisdiction based on the PAN address. Vide notification dated 15-11-2014, territorial reallocation of wards at Raipur was undertaken and consequent upon this restructuring, the jurisdiction over the area comprising Samta Colony stood automatically transferred to ITO, Ward-2(1), Raipur and thereafter, the ITO, Ward-2(1), Raipur, on 18-3-2015, pursuant to the notice issued earlier, continued the jurisdiction after reallocation and passed the order of assessment under Section 143(3) of the IT Act on 18-3-2015 determining total income at Rs.28,38,520/- by including the additions as (i) disallowance under Section 40(a)(ia) of the IT Act of Rs.4,59,219/- and (ii) addition ofRs.20,82,915/- on undisclosed turnover.

5. Feeling aggrieved and dissatisfied with the order dated 18-3-2015 passed by the Assessing Officer (AO), the assessee preferred an appeal before the Commissioner of Income Tax (Appeals) and the CIT (Appeals)-I, Raipur by its order dated 14-7-2016 partly allowed the appeal deleting the disallowance under Section 40(a)(ia), but the addition of Rs.20,82,915/- on undisclosed turnover was reduced toRs.11,53,939/- and disposed of the appeal accordingly.

6. The assessee/appellant herein not being satisfied with the part of the order rejecting his contention sustaining the addition of Rs.11,53,939/-, preferred an appeal before the ITAT, Raipur and raised an additional ground alleging lack of jurisdiction and invalid notice under Section 143(2) of the IT Act. The ITAT by its impugned order held that the notice dated 8-8-2013 issued by the ITO, Ward-1(1), Raipur was valid being based on the PAN database residential address relying upon the decision of the Supreme Court in the matter of Principal Commissioner of Income-tax, Mumbai v. I-Ven Interactive Ltd. , [2019] 418 ITR 662 (SC) in which it has been held that issuance of notice at the PAN-based address constitutes valid assumption of jurisdiction when the assessee has not