The ACIT, Circle-2(1), Guntur v. M/s Jayalakshmi Enterprises, Ongole

ITA 103/VIZ/2004 | 1995-1996
Pronouncement Date: 03-08-2010 | Result: Allowed

Appeal Details

RSA Number 10325314 RSA 2004
Bench Visakhapatnam
Appeal Number ITA 103/VIZ/2004
Duration Of Justice 6 year(s) 5 month(s) 8 day(s)
Appellant The ACIT, Circle-2(1), Guntur
Respondent M/s Jayalakshmi Enterprises, Ongole
Appeal Type Income Tax Appeal
Pronouncement Date 03-08-2010
Appeal Filed By Department
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 03-08-2010
Date Of Final Hearing 14-04-2010
Next Hearing Date 14-04-2010
Assessment Year 1995-1996
Appeal Filed On 24-02-2004
Judgment Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH: VISAKHAPATNAM BEFORE: SRI SUNIL KUMAR YADAV JUDICIAL MEMBER AND SRI B.R. BASKARAN ACCOUNTANT MEMBER I.T.A. NO.103/VIZAG/2004 ASSESSMENT YEAR : 1995-96 ACIT CIRCLE-2(1) GUNTUR VS. M/S. JAYALAKSHMI ENTERPRISES ONGOLE (APPELLANT) (RESPONDENT) GIR NO.J-311 APPELLANT BY : SHRI G.S.S. GOPINATH DR RESPONDENT BY : SHRI C.P. RAMASWAMI ADVOCATE O R D E R PER SHRI B.R. BASKARAN ACCOUNTANT MEMBER : THE APPEAL OF THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 3.12.2003 PASSED BY LEARNED. CIT(A) GUNTUR AND IT RELATES TO THE ASSESSMENT YEAR 1995-96. 2. ALL THE GROUNDS RAISED BY THE REVENUE GIVE RISE TO A SINGLE ISSUE VIZ. WHETHER LEARNED CIT(A) IS RIGHT IN LAW IN ANNULLING THE ASSESSMENT BY HOLDING THAT THE ASSESSING OFFICER DID NOT HAVE JURISDICTIO N OVER THE ASSESSEE. 3. THE FACTS RELATING TO THE ISSUE ARE STATED IN BR IEF. THE ASSESSEE FIRM FILED ITS RETURN OF INCOME UP TO THE ASSESSMENT YEAR 1992 -93 WITH A.C.IT CIRCLE-1 RAJAHMUNDRY. IT WAS DERIVING RENTAL INCOME FROM A GODOWN CONSTRUCTED BY IT AT KAKINADA. THE SAID GODOWN WAS SOLD BY ASSESSEE DUR ING THE YEAR RELEVANT TO THE ASSESSMENT YEAR 1994-95. THE REVENUE CARRIED OUT S EARCH AND SEIZURE OPERATION IN THE HANDS OF SHRI GUMMADI VENKATESWARLU GROUP. THE SAID FIRM CLAIMED TO HAVE RECEIVED UNSECURED LOANS FROM THE ASSESSEE FIR M. THE ASSESSING OFFICER OF THAT GROUP VIZ. THE D.C.IT GUNTUR NOTICED FROM TH E PAPER BOOK FILED BY GUMMADI VENKATESWARLU GROUP THAT THE ASSESSEE FIRM WAS HAVING TAXABLE INCOME BY WAY OF COMMISSION RECEIPTS FOR THE ASSESS MENT YEAR 1995-96. ACCORDINGLY THE SAID ASSESSING OFFICER ON NOTICIN G THAT THE ASSESSEE FIRM DID NOT FILE RETURN OF INCOME FOR THAT YEAR ISSUED NOTICE U/S 148 DATED 28.3.2002 TO THE 2 ASSESSEE AND THE SAME WAS SERVED ON THE ASSESSEE ON 31.3.2002. THE ASSESSEE DID NOT FILE RETURN OF INCOME IN RESPONSE TO THE NO TICE ISSUED U/S 148. SUBSEQUENTLY THE ASSESSING OFFICER ISSUED A LETTER DATED 11.3.2003 TO THE ASSESSEE REQUESTING IT TO FILE THE RETURN OF INCOME IMMEDIATELY. IN RESPONSE TO THAT LETTER THE ASSESSEE FILED A LETTER DATED 21.3. 2003 BY STATING THAT THE JURISDICTION OF ITS CASE VESTS WITH A.C.IT RAJAHMUN DRY AND NOT WITH D.C.IT GUNTUR. ACCORDINGLY THE ASSESSEE OBJECTED TO THE JURISDICTION OF THE PRESENT ASSESSING OFFICER. HOWEVER THE ASSESSING OFFICER BY REFERRING TO THE PROVISIONS OF SECTION 124(3)(B) REJECTED THE CONTENTIONS OF TH E ASSESSEE AND COMPLETED THE ASSESSMENT TO THE BEST OF HIS JUDGMENT U/S 144 OF T HE ACT BY DETERMINING THE TOTAL INCOME AT RS.8 21 350/-. IN THE APPEAL PREFE RRED BY THE ASSESSEE LEARNED CIT(A) HELD THAT THE ASSESSING OFFICER AT GUNTUR DI D NOT HAVE JURISDICTION OVER THE ASSESSEE AND ACCORDINGLY ANNULLED THE ASSESSMENT. AGGRIEVED BY THE ORDER OF LEARNED CIT(A) THE REVENUE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND CAREFULL Y PERUSED THE RECORD. SECTION 124 OF THE INCOME TAX ACT DEALS WITH THE SU BJECT OF THE JURISDICTION OF AN ASSESSING OFFICER. SUB-SECTION 3 OF SECTION 124 PR OVIDES FOR THE TIME LIMIT FOR OBJECTING TO THE JURISDICTION ASSUMED BY ANY ASSESS ING OFFICER. THE EFFECT OF SECTION 124(3)(B) HAS BEEN DISCUSSED BY THE ASSESSI NG OFFICER AS UNDER:- MOREOVER THE ASSESSEES OBJECTION REGARDING THE JURISDICTION IS ALSO NOT LEGALLY SUSTAINABLE IN VIE W OF THE PROVISIONS OF SECTION 124(3)(B). IT IS PROVIDED THEREIN THAT NO PERSON SHALL BE ENTITLED TO CALL IN QUESTION THE JURISDICTION OF TH E ASSESSING OFFICER AFTER THE EXPIRY OF THE TIME ALLOWED BY THE NOTICE U/S 142(1) OR SECTION 148 FOR MAKING THE RETURN WHERE SUCH PERSO N HAS NOT FILED THE RETURN AT ALL. IN THE PRESENT CASE THE ASSESS EE HAS NOT FILED THE RETURN AT ALL FOR THIS ASSESSMENT YEAR AND IT H AS NOT QUESTIONED THE JURISDICTION OF THE ASSESSING OFFICER BEFORE TH E EXPIRY OF THE TIME ALLOWED IN THE NOTICE U/S 148 FOR MAKING THE R ETURN. SINCE THE NOTICE U/S 148 WAS SERVED ON 31.3.2002 AND SINC E THE ASSESSEE WAS GIVEN TIME OF 30 DAYS TO FILE THE RETU RN FROM THE DATE OF SERVICE OF NOTICE ANY OBJECTION REGARDING JURISDICTION FOR ISSUING THE NOTICE SHOULD HAVE BEEN FILED BY THE AS SESSEE ON OR BEFORE 30.4.2002 WHICH WAS THE TIME ALLOWED FOR MA KING THE RETURN. HOWEVER THE ASSESSEE HAS CALLED IN QUESTI ON THE JURISDICTION FOR THE FIRST TIME VIDE LETTER DATED 2 1.3.2003 WHICH IS NEARLY ONE YEAR AFTER THE DATE OF SERVICE OF THE NO TICE U/S 148. IN VIEW OF THIS THE ASSESSEE IS NOT LEGALLY ENTITLED TO QUESTION THE JURISDICTION FOR THE ISSUE OF THE NOTICE AND FOR CO MPLETION OF THE 3 ASSESSMENT IN ACCORDANCE WITH THE PROVISIONS OF SE CTION 124(3)(B) OF THE I.T. ACT. 5. THE ASSESSEE HEREIN HAS NOT FILED ANY RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION. THE ASSESSEE FIRM HAS BE EN SERVED WITH A NOTICE U/S 148 ON 31.3.2002. HENCE THE ASSESSEE FIRM HAS TO OBJECT TO THE JURISDICTION OF THE ASSESSING OFFICER AS PER THE PROVISIONS OF SECT ION 124(3)(B). AS DISCUSSED BY THE ASSESSING OFFICER THE ASSESSEE FIRM SHOULD HAVE OBJECTED WITHIN THE TIME PRESCRIBED IN THE NOTICE ISSUED U/S 148. HENCE IN OUR OPINION THE ASSESSEE FIRM HAVING FAILED TO DO SO IS NOT ENTITLED TO CA LL IN QUESTION THE JURISDICTION OF THE ASSESSING OFFICER AS PER THE PROVISIONS OF SECT ION 124(3). HENCE WE ARE OF THE VIEW THE LEARNED CIT(A) IS NOT RIGHT IN LAW IN HOLDING THAT THE ASSESSING OFFICER IN THE INSTANT CASE DID NOT HAVE JURISDICTI ON. ACCORDINGLY WE SET ASIDE THE ORDER OF LEARNED CIT(A). IT WAS POINTED OUT TO US THAT THE LEARNED CIT(A) DID NOT ADJUDICATE THE ISSUES ON MERIT. HENCE IN ORDE R TO ENABLE THE LEARNED. CIT(A) TO ADJUDICATE THE ISSUES ON MERITS OF ADDITI ONS MADE IN THE ASSESSMENT WE SET ASIDE THE APPEAL TO THE FILE OF LEARNED CIT( A). 6. IN THE RESULT THE APPEAL FILED BY THE REVENUE I S TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED ACCORDINGLY ON 3 RD AUGUST 2010. SD/- SD/- (SUNIL KUMAR YADAV) (B.R. BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PVV/SPS VISAKHAPATNAM DATE : 03-08-2010. A COPY OF THIS ORDER IS FORWARDED TO : 01 ADDITIONAL COMMISSIONER OF INCOME TAX CIRCLE-2( 1) GUNTUR 02 M/S. JAYALAKSHMI ENTERPRISES 7-5-96 KANNAVARIT HOTA GUNTUR 03 THE CIT GUNTUR 04 THE CIT (A) GUNTUR 05 THE DR ITAT VISAKHAPATNAM 06 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH