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2014 Supreme(Del) 834
IN THE HIGH COURT OF DELHI
Sanjiv Khanna and Sanjeev Sachdeva, JJ.
Commissioner of Income Tax Delhi-XVI - Appellants
Vs.
S.S. Ahluwalia - Respondent
ITA Nos. 255, 256, 257, 314, 315 and 316/2002, 1577, 1578 and 1580/2006
Decided on : 14.03.2014
For Appellant/Petitioner/Plaintiff: Mr. Amol Sinha, Sr. Standing Counsel, Mr. Anshum Jain and Rahul Kochar, Advs.
For Respondents/Defendant:Mr. S. Krishnan, Advocate.
Headnote:
The question of jurisdiction cannot be made subject matter of appeal, as the issue has to be decided on the administrative side by the Commissioner/Commissioners/Board. Appeal can, however, be filed questioning the action of the Assessing Officer in not following the procedure mentioned/stipulated in Section 124.
Fact of the Case:
The respondent assessee is an IAS Officer of Nagaland cadre, who was compulsorily retired in January, 1993. During the period 1971-72 to 1978-79, the respondent had filed income tax returns at Dimapur, Nagaland as he was posted and working there. In July 1978, he was posted to Delhi on deputation in the Ministry of Home Affairs, a position which he continued to hold till 1984. Income tax returns for the assessment years 1980-81 to 1983-84 were filed at Delhi with the Income Tax Officer, Salary Circle. As per the respondent assessee, return for the assessment year 1984-85 was filed by the respondent at Dimapur, Nagaland on or about 8th August, 1985. The return was not taken up for scrutiny assessment but was processed on 31st March, 1987 under Section 143(1) of the Act. The respondent assessee was subjected to search by the Central Bureau of Investigation on 27th March, 1987. It is the case of the Revenue that the assessee had acquired 18 commercial properties in Delhi, 370 acres agricultural land in and around Delhi and had substantial unaccounted/undisclosed deposits in form of Fixed Deposit Receipts. These assets/properties were in names of the respondent and his family members.
Finding of the Court:
The provisions ensure that conflict between Assessing Officers having concurrent jurisdictions is avoid and curtailed and the assessment proceeding do not get misdirected on side issues. Such deviation should be avoided. It is also clear that question of jurisdiction cannot be made subject matter of appeal, as the issue has to be decided on the administrative side by the Commissioner/Commissioners/Board. Appeal can, however, be filed questioning the action of the Assessing Officer in not following the procedure mentioned/stipulated in Section 124.
Issues: Whether the ITAT was correct in law in holding that the order of assessment passed by the ACIT, Investigation Circle 8(1), New Delhi were without jurisdiction and therefore void ab initio?
Ratio Decidendi: The provisions indicate that Sections 120, 124 and 127 of the Act recognizes flexibility and choice, both with the assessee and the authorities i.e. the Assessing Office before whom return of income could be filed and assessment could be made. The Assessing Officer within whose area an assessee was carrying on business, resided or otherwise income had accrued or arisen (in the last case, subject to the limitation noticed above) has jurisdiction. Similarly, the Assessing Officer also has authority due to class of income or nature and type of business. The Act, therefore, recognized multiple or concurrent jurisdictions. Provisions of Section 124 ensures and prevents two assessments by different assessing officers, having or enforcing concurrent jurisdiction. There cannot be and the Act does not envisage two assessments for the same year by different officers. (Reassessment order can be by a different officer).
Final Decision: The substantial question of law raised in the present wealth tax appeals are answered in favour of the appellant-Revenue and against the respondent-assessee. It is apparent that the respondent assessee did not challenge and object to the jurisdiction of the Assessing Officer at any stage. Reference to the Commissioner/Commissioners was not required as per the Section 124 of the Act. There was waiver and respondent/assessee had accepted jurisdiction of the AO, Delhi. Tribunal could not have, therefore, held to the contrary. The tribunal will now decide the appeals of the assessee/Revenue pending before them on merits and not on the question of jurisdiction of the Assessing Officer.
Sanjiv Khanna, J.
ITA Nos. 255/2002, 256/2002, 257/2002, 1577/2006, 315/2002, 1578/2006, 316/2002, 1580/2006, 314/2002
1. The respondent assessee is an IAS Officer of Nagaland cadre, who was compulsorily retired in January, 1993. During the period 1971-72 to 1978-79, the respondent had filed income tax returns at Dimapur, Nagaland as he was posted and working there. In July 1978, he was posted to Delhi on deputation in the Ministry of Home Affairs, a position which he continued to hold till 1984. Income tax returns for the assessment years 1980-81 to 1983-84 were filed at Delhi with the Income Tax Officer, Salary Circle. As per the respondent assessee, return for the assessment year 1984-85 was filed by the respondent at Dimapur, Nagaland on or about 8th August, 1985. The return was not taken up for scrutiny assessment but was processed on 31st March, 1987 under Section 143(1) of the Act.
2. The respondent assessee was subjected to search by the Central Bureau of Investigation on 27th March, 1987. It is the case of the Revenue that the assessee had acquired 18 commercial properties in Delhi, 370 acres agricultural land in and around Delhi and had substantial unaccounted/undisclosed deposits in form of Fixed Deposit Receipts. These assets/properties were in names of the respondent and his family members.
3. The Assessing Officer at Delhi i.e. Assistant Commissioner of Income Tax (Investigation), Circle 8(1) (hereinafter referred to as the AO, Delhi) issued notice under Section 148 of the Act dated 26th June, 1987 in respect of assessment years 1984-85, 1985-86, 1986-87 and 1987-88. Commissioner of Income Tax, Delhi by order dated 10th November, 1987 transferred the case of the respondent assessee from Income Tax Officer, Salary Circle to AO, Delhi i.e. Assistant Commissioner of Income Tax (Investigation). Proceedings in respect of assessment year 1988-89 were taken up for scrutiny assessment by issue of notice under Section 143(2) of the Act. It appears that proceedings for the assessment year 1984-85 under Section 148 of the Act were dropped. We are not concerned with the said proceedings in the present appeals. We are also not concerned with the proceedings in respect of 1988-89 in the present income tax appeals as these appeals relate to assessment years 1985-86, 1986-87 and 1987-88. Appeals, ITA No. 89/2003 and ITA No. 1579/2006 relating to assessment year 1988-89 were disposed of vide orders dated 7th April, 2011 and 24th July, 2011, due to low tax effect.
4. The respondent assessee did not file returns pursuant to the above notices for the assessment years 1985-86, 1986-87 and 1987-88 under Section 148 of the Act. Subsequently, the assessing officer issued notice under Section 142(1) on 22nd March, 1988 and thereafter vide letter dated 25th March, 1988, the respondent assessee raised objection to the jurisdiction of the AO, Delhi. It was, inter alia, stated that the respondent was employed with the Government of Nagaland and was regularly assessed by the ITO, A Ward, Dimapur for the last many years.
5. In respect of assessment year 1985-86, the AO, Delhi passed the assessment order dated 27th March, 1990 and for assessment years 1986-87 and 1987-88, assessment orders were passed on 28th March, 1990. A few days before the assessment orders were passed, ITO, Dimapur had written letter dated 15th March, 1990 enclosing therewith income tax assessment records in two parts as directed by the AO, Delhi. Copy of the said letter was marked to Commissioner of Income Tax (Investigation) as well as Commissioner of Income Tax, North Eastern Region, Shillong and other authorities. This was followed by another letter dated 20th September, 1990 written by the ITO, Dimapur to the AO, Delhi enclosing therewith return for the assessment year 1990-91.
6. These two letters dated 15th March, 1990 and 20th September, 1990 written by the ITO, Dimapur were made subject matter of challenge before the Gauhati High Court in a writ petition filed in
