M/s. TATA SONS LTD., MUMBAI v. ACIT CIR 2(3), MUMBAI

ITA 4497/MUM/2005 | 2001-2002
Pronouncement Date: 31-10-2016

Appeal Details

RSA Number 449719914 RSA 2005
Assessee PAN AAACT4060A
Bench Mumbai
Appeal Number ITA 4497/MUM/2005
Duration Of Justice 11 year(s) 4 month(s) 13 day(s)
Appellant M/s. TATA SONS LTD., MUMBAI
Respondent ACIT CIR 2(3), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 31-10-2016
Appeal Filed By Assessee
Bench Allotted D
Tribunal Order Date 31-10-2016
Date Of Final Hearing 22-04-2015
Next Hearing Date 22-04-2015
Assessment Year 2001-2002
Appeal Filed On 17-06-2005
Judgment Text
D IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D MUMBAI BEFORE SHRI SANJAY GARG JUDICIAL MEMBER AND SHRI ASHWANI TANEJA ACCOUNTANT MEMBER ITA NO.4497/MUM/2005 ASSESSMENT YEAR: 2001-02 TATA SONS LTD. BOMBAY HOUSE 24 HOMI MODY STREET MUMBAI-400001 / VS. ACIT CIR. 2(3) AAYAKAR BHAVAN ROON NO.555 M.K. RD. MUMBAI-400020 ( APPELLANT ) ( REVENUE ) P.A. NO . AAA CT 4060A ITA NO.4542/MUM/2005 ASSESSMENT YEAR: 2001-02 DCIT CIR. 2(3) AAYAKAR BHAVAN ROON NO.555 M.K. RD. MUMBAI-400020 / VS. TATA SONS LTD. BOMBAY HOUSE 24 HOMI MODY STREET MUMBAI-400001 (REVENUE) (RESPONDENT) P.A. NO . AAACT4060A APPELLANT BY SHRI DINESH VYAS (AR) REVENUE BY SHRI K. SRISHA MURTHY (DR) ! ' # $% / DATE OF HEARING : 20/10/2016 # $% / DATE OF ORDER: 31/10/2016 / O R D E R TATA SONS LTD. 2 PER ASHWANI TANEJA (ACCOUNTANT MEMBER): THESE CROSS APPEALS HAVE BEEN FILED AGAINST THE ORD ER OF LD. COMMISSIONER OF INCOME TAX MUMBAI -XXXII{(IN S HORT CIT(A)} DATED 31.03.2005 PASSED AGAINST THE ASSE SSMENT ORDER OF THE AO U/S 143(3) DATED 19.03.2004 FOR THE ASSESSMENT YEAR 2001-02 ON THE FOLLOWING GROUNDS: ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) ERRED IN ALLOWING RELIEF TO THE ASSESSEE TO THE EXTENT IMPUGNED IN THE GROUNDS ENUMERATED BELOW. 1. THE CIT(A) ERRED IN HOLDING THAT THE FIGURE OF GROSS FUNDS OF RS.4443.16 CRORES BE ADOPTED AS DENOMINATION AS AGAINST THE CORRECT FIGURE OF RS. 1 745.69 CRORES (BEING THE TOTAL AMOUNT OF BORROWED FUNDS) W HILE CALCULATING THE INTEREST EXPENSES TO DIVIDEND INCOM E. 2. THE CIT(A) ERRED IN HOLDING THAT THE DISALLOWANCE U/S. 14A OF THE ADMINISTRATIVE 3EXPENSES ATTRIBUTABLE TO THE EARNING OF THE EXEMPT ED INCOME SHOULD BE RESTRICTED TO 1 CRORE AS AGAINST 2 % OF SUCH EXPENSES DISALLOWED BY THE AO. 2. DURING THE COURSE OF HEARING ARGUMENTS WERE MADE B Y SHRI DINESH VYAS AUTHORISED REPRESENTATIVE (SR. CO UNSEL) ON BEHALF OF THE ASSESSEE AND BY SHRI K. SRISHA MURTHY DEPARTMENTAL REPRESENTATIVE (CIT-DR) ON BEHALF OF T HE REVENUE. 3. DURING THE COURSE OF HEARING THE ASSESSEE FILED FE W MORE ADDITIONAL GROUNDS ON MERITS. THE ASSESSEE VIDE ITS PETITION DATED 15.01.2016 FILED ADDITIONAL GROUNDS RAISING JURISDICTIONAL VALIDITY OF ASSESSMENT ORDER ON THE GROUND THAT THE ASSESSMENT ORDER WAS PASSED BY THE ADDITIONAL COMMISSIONER OF INCOME TAX U/S 143(3) WHO WAS NOT COMPETENT UNDER THE LAW TO DISCHARGE FUNCTIONS OF A O AND TATA SONS LTD. 3 THEREFORE IMPUGNED ASSESSMENT ORDER WAS PASSED BY HIM WITHOUT AUTHORITY OF LAW AND THUS ASSESSMENT ORDER WAS BAD IN LAW. 3.1. DURING THE COURSE OF HEARING LD. SENIOR COUNSEL VEHEMENTLY ARGUED THAT HE SHOULD BE HEARD FIRST ON THE AFORESAID LEGAL GROUNDS WHICH GO TO ROOT OF THE MATTER AND IF NEED ARISES THEN THIS CASE MAY BE HEARD ON MERITS. 3.2. PER CONTRA LD. CIT-DR INITIALLY REQUESTED FOR SHO RT ADJOURNMENT ON THE GROUND THAT HE WAS NOT PREPARED AND DOCUMENTS REQUIRED FROM THE AO IN RESPECT TO THE AF ORESAID ADDITIONAL GROUND RAISED BY THE ASSESSEE WERE NOT Y ET MADE AVAILABLE BY THE AO. IN RESPONSE LD. SENIOR COUNSE L VEHEMENTLY OPPOSED THE SUBMISSIONS OF THE LD. CIT-D R ON THE GROUND THAT IN THIS CASE NUMEROUS ADJOURNMENTS HAVE BEEN TAKEN BY THE DEPARTMENT SINCE JANUARY 2016 ON ONE PRETEXT OR THE OTHER AND EVERY TIME DIFFERENT OFFICER WOULD APPEAR IN THIS CASE AND MAKE REQUEST FOR ADJOURNMENT ON THE G ROUND THAT THE ORDER AUTHORIZING ADDITIONAL COMMISSIONER OF INCOME TAX TO PASS THE ASSESSMENT ORDER WAS NOT AVAILABLE ON RECORD AND SOME MORE TIME WAS REQUIRED TO TRACE THE SAME. ON EARLIER TWO DATES ALSO DETAILED ORDER WAS PASSED BY THE BE NCH ON THE ORDER SHEET DIRECTING THE DEPARTMENT TO ARGUE THE M ATTER ON THE NEXT DATE AND IF DEPARTMENT STILL SEEKS ADJOURN MENT THEN HEAVY COST WOULD BE IMPOSED ON THE DEPARTMENT. BUT DESPITE THAT DEPARTMENT IS TAKING THIS MATTER LIGHTLY AND IN A CASUAL MANNER AND IS DISREGARDING DETAILED ORDERS PASSED B Y THE TRIBUNAL AND THE AO HAS ALSO DISREGARDED DIRECTIONS OF THE TATA SONS LTD. 4 TRIBUNAL. HE HAS NEITHER SENT THE RECORD NOR ANY PR OPER EXPLANATION FOR NOT SENDING THE RECORDS. 3.3. UNDER THESE CIRCUMSTANCES WE WENT THROUGH THE PREVIOUS ORDERS PASSED BY THE BENCH ON THE ORDER SH EET AND ACCORDINGLY IT WAS FELT NECESSARILY THAT THE AO SHO ULD BE SUMMONED PERSONALLY TO EXPLAIN HIS CONDUCT AND NEXT DATE WAS GIVEN FOR HEARING. ACCORDINGLY THE AO WAS PERS ONALLY PRESENT ON THE NEXT DATE. BUT HE AGAIN SUBMITTED TH AT THE ORDER AUTHORIZING ADDITIONAL COMMISSIONER OF INCOME TAX FOR PASSING THE IMPUGNED ASSESSMENT ORDER WAS NOT AVAIL ABLE ON FILE. LD. CIT-DR ALSO MAINTAINED THAT NO SUCH ORDER WAS AVAILABLE. BUT HE ADDED THAT EVEN WITHOUT SUCH AN ORDER THE ADDITIONAL COMMISSIONER OF INCOME TAX WAS VERY MUCH COMPETENT AND AUTHORIZED UNDER THE LAW TO PASS THE IMPUGNED ASSESSMENT ORDER. 3.4. WE HAVE GONE THROUGH ENTIRE FACTS AND CIRCUMSTANCE S OF THE CASE AND PREVIOUS INTERIM ORDERS ISSUED ON ORDE R SHEET. IT IS NOTED THAT ON 15.06.2016 THE BENCH HAD DIRECTED THE THEN CIT-DR TO BE PRESENT ALONG WITH NECESSARY DOCUMENTS AND EXPLANATION ON 27.06.2016. ON THE NEXT DATE I.E. 27 .06.2016 THESE APPEALS WERE SUBSTANTIALLY HEARD BUT THESE WE RE SUBSEQUENTLY ADJOURNED ON THE PERSISTENT REQUEST OF THE CIT- DR ON THE GROUND THAT DEPARTMENT WANTED TO PRODUCE THE RECORDS. ACCORDINGLY DATE OF 29 TH JUNE 2016 WAS GIVEN AS LAST AND FINAL OPPORTUNITY TO THE REVENUE ON THE CONDITI ON THAT NO FURTHER ADJOURNMENT SHALL BE GIVEN AND IF STILL REC ORDS WERE NOT PRODUCED THEN ADVERSE VIEW MAY BE TAKEN ON 29.06. 2016. ON THE SAID DATE THE AO WAS PERSONALLY PRESENT ALONG WITH LD. TATA SONS LTD. 5 CIT-DR TO AGAIN MAKE A REQUEST FOR FURTHER TIME. SO MEHOW ACCEPTING HIS REQUEST THE CASE WAS ADJOURNED FOR11 .07.2011. ON SAID DATE AGAIN ADJOURNMENT REQUEST WAS MADE BY THE DEPARTMENT AND TO ACCOMMODATE THE DEPARTMENT CASE WAS ADJOURNED ON 19.07.2016. ON SAID DATE THE CIT-DR A GAIN MOVED AN APPLICATION REQUESTING FOR TWO DAYS TIME A ND GAVE AN UNDERTAKING THAT NO FURTHER ADJOURNMENT SHALL BE TA KEN BY THE DEPARTMENT. THUS TAKING STRICT VIEW ON THE CONDUCT OF THE DEPARTMENT FOLLOWING ORDER WAS PASSED: ON 15 TH JUNE 2016 THE LEARNED D.R. WAS DIRECTED TO BE PRESENT ALONGWITH NECESSARY DOCUMENTS ON 27TH JUNE 2016 LAST OPPORTUNITY WAS PROVIDED TO THE DEPARTMENT WITH A DIRECTION THAT NECESSARY DOCUMENTS/ CASE RECORD WILL HE PRODUCED. AGAIN ON 27 TH JUNE 2016 NOTHING WAS PRODUCED AND AGAIN AT THE REQUEST OF THE DEPARTMENT LAST OPPORTUNITY WAS PROVIDED TO THE DEPARTMENT WITH A DIRECTION TO PRODUCE THE RECORD. IT WAS MADE CLEAR THAT IT WILL BE THE FINAL OPPORTUNIT Y TO THE DEPARTMENT. AGAIN ON 29 TH JUNE 2016 NECESSARY DOCUMENTS WERE NOT PRODUCED AND IT WAS MADE CLEAR THAT IF THE NECESSARY RECORD IS NOT PRODUCED ADVERSE VIEW WILL BE TAKEN. AGAIN NOTHING WAS PRODUCED. THE DEPARTMENT ON 11.07.2016 AGAIN REQUESTED FOR ADJOURNMENT AND 'THUS THE BENCH WAS CONSTRAINED TO PROVIDE LAST OPPORTUNITY TO THE DEPARTMENT. TODAY I.E. 19.07.2016 THE LEARNED CIT-DR HAS AGAIN MOVED AN APPLICATION AND REQUESTED FAT TWO DAYS TIME WITH AN UNDERTAKING THAT NO FURTHER ADJOURNMENT SHALL BE REQUESTED. SINCE THESE ARE OLD APPEALS AND CONSIDERING THAT THESE APPEALS ARE TO BE DISPOSED OF ON PRIORITY BASIS THOUGH WE ARE CONSTRAINED TO GRANT ANOTHER OPPORTUNITY TO THE DEPARTMENT AS PRAYED BUT IT IS MADE CLEAR THAT NO FURTHER ADJOURNMENT SHALL BE GRANTED TO THE DEPARTMENT AND ADVERSE VIEW WILL BE TAKEN. IT IS ALSO MADE CLEAR THAT IF THE DEPARTMENT STILL TATA SONS LTD. 6 SEEKS ADJOURNMENT THEN THE HIGHER AUTHORITIES OF TH E DEPARTMENT OF REVENUE WILL HE INFORMED. THE LEARNED CIT-DR SUGGESTED THAT THESE APPEAL MAY BE TAKEN ON 22 ND JULY 2016. ACCORDINGLY THE APPEALS ARE FIXED FOR HEARING ON 22.07.2016. 3.5. ACCORDINGLY CASE WAS ADJOURNED ON 22.07.2016 AND ON THE SAID DATE LD. CIT-DR AGAIN CAME OUT WITH A NEW PLEA FOR SEEKING ADJOURNMENT AND FOLLOWING ORDER WAS PASSED ON 22.07.2016: THE LD. CIT(DR) SHRI AJIT SRIVASTAVA HAS FILED WRITTEN SUBMISSIONS FOR WHICH OUR ATTENTION WAS INV ITED TO PAGE 16 PARAGRAPH (C) OF THE SUBMISSIONS DT 22- 07- 2016. SHRI SRIVASTAVA STATES THAT THEY ARE TRYING T O LOCATE THE RELEVANT ORDER / RECORD AND SEEKS TIME F OR 3 MONTHS BY STATING THAT THE ENTIRE MACHINERY OF TH E DEPARTMENT IS ENGAGED IN THE PROCESS OF IDS. DR. DINESH VYAS THE LD. SENIOR ADVOCATE STRONGLY OPPOSED THE SUBMISSION OF THE DEPARTMENT BY STATING THAT THE APPROACH OF THE DEPARTMENT HAS BEEN VERY CASUAL AND ON EARLIER OCCASIONS LAST OPPORTUNITY WAS PROVIDED TO THE DEPARTMENT IN SPITE OF THAT T HE DEPARTMENT HAS NOT PRODUCED THE RELEVANT RECORD. 2. WE AGREE WITH THE SUBMISSIONS OF DR. DINESH VYAS AND CONSTRAINED TO OBSERVE THAT THE DEPARTMENT HAS NOT PRODUCED THE RELEVANT RECORD IN SPITE OF REPEATED OPPORTUNITIES FOR PROVIDING THE RECORD. TODAY THE LD. CIT(DR) HAS COME OUT WITH A NEW PLEA IN SUPPORT OF HIS WRITTEN SUBMISSIONS. WE ARE AWARE THAT THESE ARE OL D APPEALS AND MUST BE DISPOSED OF AT THE EARLIEST. HOWEVER CONSIDERING THE TOTALITY OF FACTS THESE A PPEALS ARE DE-HEARD. IT IS ADJOURNED FOR FRESH HEARING BY THE REGULAR BENCH. ADJOURNED TO 18TH OCTOBER ; 2016 ALONG WITH APPEAL IN ITA NO. 193/MUM/2006; 4542/MUM/2005; 2745/MUM/2006; NS ITA NO.3623/MUM/2008. THE LD. CIT(DR) HAD NO OBJECTION TO THIS DATE. HOWEVER IT IS MADE CLEAR THAT IF THE DEPARTMENT STILL SEEKS TIME AT THAT TIME HEAVY COS TS WILL BE PUT ON THE DEPARTMENT AND THESE APPEALS SHALL BE DE CIDED ON THE BASIS OF MATERIAL HELD ON RECORD. TATA SONS LTD. 7 3.6. UNDER THESE CIRCUMSTANCES CASE WAS ADJOURNED FOR 18 TH OCTOBER 2016 FOR PRODUCING REQUISITE RECORDS AND FOR MAKING FINAL ARGUMENTS. ON 18.10.2016 LD. CIT-DR AGAIN MA DE AN ADJOURNMENT APPLICATION IN A HIGHLY CASUAL MANNER W HICH WAS TURNED DOWN AS MENTIONED ABOVE AND THEREFORE HE WA S DIRECTED TO ARGUE THE MATTER AND WAS ALSO DIRECTED TO INSTRUCT THE AO TO REMAIN PRESENT DURING THE COURSE OF HEARI NG. UNDER THESE CIRCUMSTANCES ON 19.10.2016 AO APPEARED ALO NG WITH LD. CIT-DR AND TENDERED HIS APOLOGIES FOR NOT BEING ABLE TO PROVIDE THE RECORDS AS WAS DIRECTED BY THE BENCH ON EARLIER OCCASIONS. UNDER THESE CIRCUMSTANCES LD. CIT-DR RE QUESTED THAT THE CASE SHOULD BE TAKEN UP THE NEXT DATE SO T HAT FINAL ARGUMENT MAY BE MADE. UNDER THESE CIRCUMSTANCES CA SE WAS FIXED FOR FINAL ARGUMENTS ON 20.10.2016. THUS UNDE R THESE CIRCUMSTANCES WE HAVE NO OTHER OPTION BUT TO PROCE ED WITH THE HEARING OF THE MATTER ON THE BASIS OF RECORDS A VAILABLE BEFORE US. 3.7. IT IS NOTED THAT FIRST ARGUMENT MADE ON BEHALF OF THE ASSESSEE WAS WITH RESPECT TO ADDITIONAL GROUND CHAL LENGING LEGAL COMPETENCE OF THE ADDITIONAL COMMISSIONER FOR PASSING IMPUGNED ORDER. THE LD. CIT-DR VEHEMENTLY OPPOSED T HE ADMISSION OF ADDITIONAL GROUNDS AT THIS STAGE. IT I S NOTED THAT THE ASSESSEE HAS FILED ITS PETITION FOR ADMISSION O F ADDITIONAL GROUNDS WITH FOLLOWING REQUEST: DELHI BENCH OF THE HON'BLE TRIBUNAL IN THE CASE OF MEGA CORPORATION LTD. VS. ADDITIONAL CIT (ITA NO.102/DEL/2014) DECIDED ON 22/9/2015 ON THE FACTS SIMILAR TO FACTS IN THE AFORESAID APPEALS OF THE AP PELLANT HAS HELD THE ASSESSMENT ORDER TO BE INVALID AND BAD IN TATA SONS LTD. 8 LAW. THIS ORDER OF THE HON'BLE TRIBUNAL HAS JUST BE EN REPORTED AND ON THE BASIS THEREOF WE PROPOSE TO FI LE THE ADDITIONAL GROUNDS OF APPEAL CHALLENGING THE VALIDI TY OF THE ASSESSMENT ORDER PASSED IN OUR CASE. THEREFORE WE HEREBY FILE THE ENCLOSED ADDITIONAL GROUNDS OF APPE AL IN THE APPEALS REFERRED TO ABOVE AND FILED BY US WITH A RE QUEST THAT THESE GROUNDS MAY PLEASE BE ADJUDICATED BY THE HON'BLE TRIBUNAL. THE ADDITIONAL GROUNDS RAISED HEREIN GO TO THE VERY ROOT OF THE MATTER AND DEAL WITH THE VERY JURISDICTION AND AUTHORITY OF THE ASSESSING OFFICER TO PASS THE ORDE R. THEREFORE THESE GROUNDS CAN BE ADMITTED IN THE INT EREST OF SUBSTANTIAL JUSTICE AND ESPECIALLY WHEN THEY ARE RA ISED IN A BONA FIDE MANNER WITHOUT INDULGING IN DELAYING TA CTICS. IN THIS CONNECTION WE WISH TO RELY ON THE FOLLOWIN G DECISIONS OF THE HON'BLE APEX COURT AND THE HONBIE JURISDICTIONAL HIGH COURT:- 1. JUTE CORPORATION OF INDIA LTD. VS. CIT [187 ITR 688 (SC)] 2. CIT VS. S. NELLIAPPAN [66 ITR 722 (SC)] 3. AHMEDABAD ELECTRICITY CO. LTD. VS. CIT [199 ITR 351 (BOM)] 4. CIT VS. PRUTHVI BROKERS & SHAREHOLDERS [349 ITR 336 (BOM)] 5. ASHOK VARDHAN BIRLA VS. CIT [208 ITR 958 (BOM)] 6. INAROO VS. CIT [204 ITR 312 (BOM)] 7. CIT VS. GOVINDRAM BROS. P. LTD. [141 ITR 626 (BO M)] 3.8. FOLLOWING ADDITIONAL GROUNDS HAVE BEEN RAISED ALON G WITH THE AFORESAID PETITION: 1.ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE ASSESSMENT ORDER DATED 19.03.2004 PASSED BY THE ADDITIONAL COMMISSIONER OF INCOME TAX UNDER SECTION 143(3) IS HAD IN LAW ILLEGAL AND WITHOUT JURISDICTION AND/OR IN EXCESS OF JURISDICTION. ON T HE GROUNDS AMONGST OTHERS THAT HE FAILED TO ESTABLISH THAT HE POSSESSED LEGAL AND VALID JURISDICTION UNDE R THE ACT TO PASS THE ASSESSMENT ORDER AND CONSEQUENTLY THE HONBLE TRIBUNAL HE PLEASED TO QUASH THE SAID ORDER. 2. THE ADDITIONAL COMMISSIONER OF INCOME TAX LACKED JURISDICTION TO PASS THE ORDER OF TATA SONS LTD. 9 ASSESSMENT U/S 143(3) DATED 19.03.2004 AND TO EXERCISE THE POWERS OF PERFORMING THE FUNCTIONS OF AN ASSESSING OFFICER WITHOUT ESTABLISHING THAT HE POSSESS SUCH JURISDICTION CONFERRED ON HIM UNDER SECTION 120(4)(B) OF THE ACT. ACCORDINGLY IN THE ABSENCE OF AN ORDER U/S 120(4)(B) CONFERRING JURISDICTION ON THE ADDITIONAL COMMISSIONER OF INCOME TAX THE ASSESSMENT ORDER DATED 19.03.2004 PASSED BY HIM NEEDS TO BE QUASHED. 3. THE PROCEEDINGS HAVING BEEN INITIATED BY ISSUE O F A NOTICE U/S 143(2) ON 30.09.2002 BY THE ASST. COMMISSIONER OF INCOME TAX IN THE ABSENCE OF AN ORDER TRANSFERRING JURISDICTION U/S 127 TO THE ADDITIONAL COMMISSIONER OF INCOME TAX THE ORDER OF ASSESSMENT DATED 19.03.2004 PASSED BY THE ADDITIONAL COMMISSIONER OF INCOME TAX. IS WITHOUT JURISDICTION AND NEEDS TO BE QUASHED. 4. THE PROCEEDINGS HAVING BEEN INITIATED BY THE LOWER AUTHORITY (VIZ. ASST. COMMISSIONER OF INCOME TAX) IN THE ABSENCE OF AN ORDER TRANSFERRING JURISDICTION U/S 127 TO THE ADDITIONAL COMMISSIONER OF INCOME TAX THE ORDER OF ASSESSMENT PASSED BY THE HIGHER AUTHORITY (VIZ. ADDITIONAL COMMISSIONER OF INCOME TAX) IS WITHOUT JURISDICTION AND NEEDS TO BE QUASHED. 5. AS HELD IN MEGA CORPORATION LTD VS. ADDL. CIT IT A NO. 102/DEL/2014. IN A CASE WHERE THE PROCEEDINGS HAVE BEEN INITIATED BY ONE OFFICER AND THE ASSESSMENT ORDER IS PASSED BY THE ANOTHER OFFICER THE ASSESSMENT ORDER IS BAD IN LAW AND ILLEGAL AND THEREFORE THE IMPUGNED ASSESSMENT ORDER IN THIS CASE SHOULD HE QUASHED. 3.9. WE HAVE GONE THROUGH THE AFORESAID PETITION AND FI NAL GROUNDS RAISED BY THE ASSESSEE. 3.10. THE SOLITARY ISSUE RAISED IN THESE ADDITIONAL GROU NDS IS FOR CHALLENGING THE JURISDICTIONAL VALIDITY OF THE ASSESSMENT ORDER ON THE GROUND THAT ADDITIONAL COMMISSIONER OF INCOME TAX WHO HAD PASSED IMPUGNED ASSESSMENT ORDER DID NOT TATA SONS LTD. 10 HAVE THE AUTHORITY OF LAW TO ACT AS AN ASSESSING OF FICER AND TO PASS THE IMPUGNED ASSESSMENT ORDER. 3.11. ADMISSION OF ADDITIONAL GROUNDS: THE ASSESSEE HAS CHALLENGED LEGAL COMPETENCE OF THE ADDITIONAL COMMISSIONER OF INCOME TAX TO ACT AS AN ASSESSING OFFICER OF THE ASSESSEE AND TO PASS THE IMPUGNED AS SESSMENT ORDER BY WAY OF ADDITIONAL GROUNDS. THE ISSUE RAIS ED BY THE ASSESSEE GOES TO THE ROOT OF THE MATTER AND SEEKS T O SHAKE THE VERY SUSTAINABILITY OF THE IMPUGNED ASSESSMENT ORDE R IN THE EYES OF LAW. DURING THE COURSE OF HEARING IT WAS SHOWN BY THE LD. SENIOR COUNSEL OF THE ASSESSEE THAT LAW IN THIS REGARD HAS BEEN DEVELOPED RECENTLY. MOREOVER THIS FACT WAS N OT IN THE KNOWLEDGE OF THE ASSESSEE THAT THE ADDITIONAL COMMI SSIONER OF INCOME TAX HAD ASSUMED JURISDICTION TO FRAME THE IM PUGNED ASSESSMENT ORDER WITHOUT THE AUTHORITY OF LAW AND W ITHOUT THERE BEING ANY ORDER FROM THE COMMISSIONER OF INCO ME TAX AUTHORIZING HIM TO ACT AS ASSESSING OFFICER OF THE ASSESSEE. UNDER THESE CIRCUMSTANCES IT IS BOUNDEN DUTY OF TH E REVENUE TO ESTABLISH LEGAL COMPETENCE AND AUTHORITY OF THE OFFICER PASSING THE ASSESSMENT ORDER IF SO CHALLENGED BY A N ASSESSEE AT ANY STAGE. 3.12. WE HAVE EXAMINED THIS ISSUE. IT IS WELL ACCEPTED P OSITION THAT THE TRIBUNAL IS A FINAL FACT FINDING BODY. RE QUISITE DOCUMENTS REQUIRED FOR ESTABLISHING LEGAL AUTHORITY OF THE ASSESSING OFFICER WHO HAD PASSED THE ASSESSMENT ORD ER ARE EXPECTED TO BE AVAILABLE IN THE ASSESSMENT RECORDS. THUS THE LEGAL ISSUE RAISED BY THE ASSESSEE FALLS IN THE CAT EGORY OF CASES WHICH CAN BE DECIDED ON THE BASIS OF MATERIAL HELD ON RECORD. TATA SONS LTD. 11 3.13. FURTHER IT IS NOTED BY US THAT THE AFORESAID GROU NDS ARE PURELY LEGAL GROUNDS AND DO NOT REQUIRE ANY INVESTI GATION OF FRESH FACTS AND CAN BE DECIDED ON THE BASIS OF RECO RDS HELD ON RECORD. IT HAS BEEN HELD BY THE HONBLE SUPREME COU RT IN THE CASE OF NATIONAL THERMAL POWER CORPORATION 229 ITR 383 AS WELL AS IN THE OTHER JUDGMENTS AS HAVE BEEN RELI ED UPON BY THE LD. COUNSEL IN ITS PETITION THAT ASSESSEE SHOUL D BE PERMITTED TO RAISE LEGAL GROUNDS AT ANY STAGE IF T HEY GO TO THE ROOT OF THE MATTER. 3.14. REVENUES ARGUMENT TO REJECT THE ADDITIONAL G ROUNDS DUE TO ACQUIESCENCE AND PARTICIPATION OF THE ASSESS EE IN ASSESSMENT PROCEEDINGS: IT WAS CONTENDED BY THE LD. CIT-DR THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS ASSESSEE HAD MADE PARTICIPA TION IN THE PROCEEDINGS. THEREFORE ASSESSEE CANNOT BE ALL OWED TO CHALLENGE JURISDICTIONAL DEFECT IN THE ASSESSMENT O RDER AT THIS STAGE. WE HAVE CONSIDERED THIS ASPECT VERY CAREFUL LY. THE ASSESSEE HAS CHALLENGED BEFORE US AUTHORITY OF THE OFFICER TO PASS THE IMPUGNED ASSESSMENT ORDER. IT IS BOUNDEN DUTY OF THE REVENUE TO ESTABLISH THE AUTHORITY AND LEGAL CO MPETENCE OF ITS OFFICER TO PASS THE ASSESSMENT ORDER AS AND WH EN IT IS CALLED UPON TO DO SO. NO ORDER CAN BE SUSTAINED IN THE EYES OF LAW IF ITS AUTHOR DOES NOT HAVE REQUISITE SANCTION OF THE LAW. IF AN ORDER DOES NOT POSSESS REQUISITE STRENGTH IN THE EYES OF LAW AND IS VOID AB-INITIO THEN IT WILL REMAIN SO EVEN IF THERE IS ACQUIESCENCE OR PARTICIPATION BY THE ASSESSEE IN TH E PROCEEDINGS CARRIED OUT BY THE AO TO FRAME THE ASSE SSMENT ORDER. IT IS WELL SETTLED LAW THAT CONSENT OF THE ASSESSEE CANNOT CONFER JURISDICTION TO AN ASSESSING OFFICER WHO LACKED TATA SONS LTD. 12 JURISDICTION UNDER THE LAW. SIMILARLY VICE VERSA IS ALSO TRUE I.E. ABSENCE OF CONSENT OF THE ASSESSEE SHALL NOT T AKE AWAY JURISDICTION FROM AN ASSESSING OFFICER WHO ACTUALLY POSSESSED A VALID JURISDICTION IN THE EYES OF LAW. THUS LE GAL COMPETENCE OF THE OFFICER WHO PASSED THE ASSESSMENT ORDER AS W ELL AS VALIDITY OF THE ASSESSMENT ORDER MUST BE EXAMINED O N THE BASIS OF FACTUAL ANALYSIS AND PROVISIONS OF LAW AND NOT ON THE BASIS OF CONDUCT OF THE ASSESSEE. THIS ISSUE IS N OT RES-INTEGRA . IMMEDIATE REFERENCE IN THIS REGARD CAN BE MADE ON T HE JUDGMENT OF HONBLE BOMBAY HIGH COURT IN THE CASE OF INVENTORS INDUSTRIAL CORPORATION LIMITED VS. CIT 19 4 ITR 548 (BOMBAY). SIMILAR VIEW WAS TAKEN BY HONBLE GUJARAT HIGH COURT IN THE CASE OF P.V. DOSHI VS. CIT 113 ITR 22 (GUJ) . RECENTLY HONBLE DELHI HIGH COURT HANDLED A SIMIL AR SITUATION IN THE CASE OF VALVOLINE CUMMINS LTD 307 ITR 103 (DEL) WHEREIN CHALLENGE WAS MADE TO THE JURISDICTION OF ADDITIONAL COMMISSIONER OF INCOME TAX WHO HAD PASSE D THE ASSESSMENT ORDER. IT WAS CONTENDED ON BEHALF OF TH E REVENUE THAT CHALLENGE OF JURISDICTION MUST BE MADE WITHIN THE STIPULATED TIME DURING THE COURSE OF ASSESSMENT PRO CEEDINGS IN VIEW OF RESTRICTIONS IMPOSED BY THE PROVISIONS C ONTAINED IN SECTION 124 OF THE ACT. HONBLE DELHI HIGH COURT IN THE AFORESAID CASE HELD AS UNDER:- THIS IS WELL SETTLED THAT MERE ACQUIESCENCE IN THE EXERCISE OF POWERS BY A PERSON WHO DOES NOT HAVE JURISDICTION TO EXERCISE THAT POWER CANNOT WORK AS AN ESTOPPEL AGAINST HIM. 3.15. IT IS FURTHER NOTED BY US THAT IN THE CASE BEFORE US A CHALLENGE HAS BEEN MADE ABOUT THE LEGAL COMPETENCE OF THE ADDITIONAL COMMISSIONER OF INCOME TAX AND HIS JURIS DICTION TO TATA SONS LTD. 13 EXERCISE THE POWERS AND PERFORM THE FUNCTIONS OF TH E ASSESSING OFFICER OF THE ASSESSEE AND TO CARRY OUT THE ASSESS MENT PROCEEDINGS AND FRAME THE ASSESSMENT ORDER IN ACCOR DANCE WITH THE PROVISIONS OF THE INCOME TAX ACT 1961. T HUS RELIANCE UPON THE PROVISIONS CONTAINED IN SECTION 1 24 OF THE ACT WOULD BE OF NO HELP TO THE REVENUE AS THE ASSES SEE HAS NOT CHALLENGED EITHER TERRITORIAL JURISDICTION OR I RREGULAR EXERCISE OF JURISDICTION BY THE ADDITIONAL COMMISSI ONER OF INCOME TAX BUT CHALLENGE WAS MADE TO THE AUTHORITY AND LEGAL COMPETENCE ITSELF OF THE ADDITIONAL COMMISSIONER OF INCOME TAX TO PASS THE IMPUGNED ASSESSMENT ORDER UPON THE ASSESSEE. SIMILAR VIEW HAS BEEN TAKEN BY THE DELHI BENCH OF ITAT IN THE CASE OF MEGA CORPORATION LTD VS. ADDITIONAL CIT 155 ITD 1019 (DELHI) FOLLOWING THE JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF VALVOLINES CUMMINS LTD S UPRA. 3.16. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THIS CA SE AND THE JUDGMENTS OF HONBLE SUPREME COURT AND HONBLE BOMBAY HIGH COURT RELIED UPON BY THE LD. COUNSEL IN ITS PE TITION AS MENTIONED ABOVE WE FIND THAT THESE ADDITIONAL GROU NDS DESERVE TO BE AN ADMITTED AND THEREFORE THESE ARE ADMITTED FOR OUR ADJUDICATION. 3.17 . SINCE THE ADDITIONAL GROUNDS GO TO THE ROOT OF TH E MATTER AND CHALLENGE JURISDICTIONAL VALIDITY OF THE ORDER THEREFORE WE FIND IT APPROPRIATE TO FIRST DEAL WITH THE SAME BEF ORE DECIDING THE APPEAL ON MERITS. IT HAS BEEN ARGUED AT LENGTH BY THE LD. SENIOR COUNSEL OF THE ASSESSEE THAT IN THIS CASE FI RST NOTICE OF ASSESSMENT PROCEEDINGS INTIMATING CHANGE OF JURISDI CTION WAS ISSUED BY ACIT CIRCLE 2(3) MUMBAI DATED 5 TH SEPTEMBER 2001 TATA SONS LTD. 14 WHEREIN IT WAS CLAIMED THAT THE JURISDICTION OF ASS ESSMENT WAS WITH THE SAID OFFICER. SUBSEQUENTLY NOTICE U/S 143 (2) WAS ISSUED BY THE DCIT DATED 01.12.2003. THEREAFTER A QUESTIONNAIRE WAS ISSUED BY THE ADDITIONAL COMMISSI ONER OF INCOME TAX RANGE -2(3) MUMBAI DATED 10 TH FEBRUARY 2004 AND FINALLY THE ADDITIONAL COMMISSIONER OF INCOME T AX FRAMED THE ASSESSMENT ORDER. HE TOOK US THROUGH THE VARIOU S PROVISIONS OF INCOME TAX ACT TO IMPRESS UPON THE PO INT THAT ADDITIONAL COMMISSIONER OF INCOME TAX WAS NOT LEGAL LY COMPETENT TO ACT AS ASSESSING OFFICER AND TO PASS A SSESSMENT ORDERS. HE REFERRED TO PROVISIONS OF SECTION 2(7A) WHICH PROVIDE DEFINITION OF THE TERM ASSESSING OFFICER. HE ALSO REFERRED TO THE PROVISIONS OF SECTION 2(28C) WHICH DEFINES JOIN T COMMISSIONER OF INCOME TAX. IT WAS ARGUED THAT IN T HE DEFINITION OF ASSESSING OFFICER EARLIER ONLY JOINT COMMISSIONER WAS PROVIDED AND ADDITIONAL COMMISSIONER WAS INSERT ED SUBSEQUENTLY. IT WAS FURTHER SUBMITTED THAT ONLY TH OSE JOINT COMMISSIONERS/ADDITIONAL COMMISSIONERS WERE COMPETE NT TO PASS THE ASSESSMENT ORDER WHO WERE AUTHORIZED TO AC T AN ASSESSMENT OFFICER AS PER CLAUSE (B) OF SUB-SECTION 4 OF SECTION 120. IT WAS VEHEMENTLY ARGUED THAT THE ADDITIONAL COMMISSIONER WHO PASSED THE IMPUGNED ASSESSMENT ORD ER WAS NOT HAVING ANY AUTHORITY ISSUED FROM THE BOARD OR THE JURISDICTIONAL COMMISSIONER OF INCOME TAX TO ACT AS AN ASSESSING OFFICER AND TO PASS AN ASSESSMENT ORDER I N THE CASE OF THE ASSESSEE. HE ALSO TOOK US THROUGH PROVISIONS OF SECTION 120 TO ARGUE THAT ADDITIONAL COMMISSIONER OR JOINT COMMISSIONER COULD HAVE EXERCISED THE POWER OF AN A SSESSING TATA SONS LTD. 15 OFFICER ONLY IF THEY WERE SO AUTHORIZED SPECIFICALL Y BY THEIR JURISDICTIONAL COMMISSIONER. IN SUPPORT OF HIS PROP OSITION HE RELIED UPON FOLLOWING JUDGMENTS: 1. MEGA CORPORATION V. ADDL. CIT (62 TAXMANN.COM 35 1(DEL. ITAT) 2. BINDAL APPARELS LTD. ACIT 104 TTJ 950(DEL) 3. CITY GARDEN VS. ITO (21 TAXMANN.COM 373 (JODHPUR ITAT) 4. MICROFIN SECURITIES (P) LTD. VS. ADDL. CIT 3 SOT 302 (LUK.) 5. PRACHI LEATHERS LTD. 26L/LUK/2010 IN ITA NO.744/LUK/2004 ORDER DAT. 29.03.2010 6. HARVINDER SINGH JAGGI VS. ACIT 67 TAXMANN.COM 10 9(DEL. ITAT) 7. DR. NALINI MAHAJAN VS. DIT (INV.) 257 ITR 123(DE L. HC) 8. GHANSHYAM K. KHABRANI VS. ACIT 346 ITR 443(BOM. HC) 9. CIT VS. SPLS SIDDHARTHA LTD. 345 ITR 223 (DEL. HC) 3.18. PER CONTRA LD. CIT-DR WITH THE ASSISTANCE OF LD. AO VEHEMENTLY OPPOSED THE SUBMISSIONS OF THE LD. SENIO R COUNSEL AND ARGUED THAT ALL THE ADDITIONAL COMMISSI ONERS HAVE CONCURRENT JURISDICTION UPON ALL THE ASSESSES FALLING IN THEIR RESPECTIVE RANGES AND THEREFORE ADDITIONAL C OMMISSIONER WAS WELL WITHIN HIS COMPETENCE TO PASS THE IMPUGNED ASSESSMENT ORDER. IT WAS FURTHER SUBMITTED THAT AS PER SECTION 2(28C) JOINT COMMISSIONER INCLUDES ADDITIONAL COMMISSIONERS ALSO. IT WAS FURTHER SUBMITTED THAT S ECTION 2(7A) WAS AMENDED RETROSPECTIVELY AND THE WORD ADD ITIONAL COMMISSIONER WAS ALSO INSERTED ALONG WITH WORD JO INT COMMISSIONER BY FINANCE ACT 2007 WITH RETROSPECT IVE EFFECT FROM 01.06.1994. IN RESPONSE TO OUR QUERY LD. CIT- DR FAIRLY TATA SONS LTD. 16 SUBMITTED THAT HE WAS NOT ABLE TO SUBMIT ANY ORDER FROM THE BOARD OR CHIEF COMMISSIONER OF INCOME TAX OR JURISD ICTIONAL COMMISSIONER OF INCOME TAX AUTHORIZING THE PRESENT ADDITIONAL COMMISSIONER OF INCOME TAX TO ACT AS AN ASSESSING OFFICER AND TO PASS ASSESSMENT ORDER. BUT HE MAINT AINED THAT EVEN WITHOUT AND SUCH SPECIFIC ORDER THE ADDITIONA L COMMISSIONER WAS LEGALLY COMPETENT TO PASS THE IMPU GNED ASSESSMENT ORDER. 3.19. IN REJOINDER LD. SENIOR COUNSEL OF THE ASSESSEE A GAIN TOOK US THROUGH ALL THE PREVIOUS ORDER SHEET ENTRIE S RECORDED BY THE BENCH ON EARLIER DATES WHEREIN BENCH HAD REP EATEDLY DIRECTED AND HAD GIVEN OPPORTUNITY TO THE DEPARTMEN T TO PRODUCE IF THERE WAS ANY ORDER AUTHORIZING THE ADDI TIONAL COMMISSIONER OF INCOME TAX TO PASS IMPUGNED ASSESSM ENT ORDER. IT WAS FURTHER SUBMITTED BY HIM THAT ASSESSE E IS NOT CHALLENGING TERRITORIAL JURISDICTION OF THE ASSESSE E BUT THE ASSESSEE IS CHALLENGING LEGAL COMPETENCE OF THE OFF ICER TO PASS THE IMPUGNED ASSESSMENT ORDER AND IT CAN BE DONE AT ANY STAGE. UNDER THESE CIRCUMSTANCES THE RESTRICTION P ROVIDED U/S 124 WAS NOT APPLICABLE. IF THE LEGAL COMPETENCE OF THE OFFICER IS CHALLENGED THEN IT IS FOR THE REVENUE TO ESTABLISH THAT THE OFFICER WAS LEGALLY AUTHORIZED TO PASS THE ASSESSME NT ORDER. IT WAS LASTLY ARGUED THAT CASE OF THE ASSESSEE WAS SQU ARELY COVERED IN VIEW OF VARIOUS JUDGMENT RELIED UPON BY THE COUNSEL WHEREIN IT HAS BEEN INTER-ALIA HELD THAT IF THE LAW MANDATES A PARTICULAR ACT TO BE DONE IN A PARTICULAR MANNER T HEN THAT ACT SHOULD BE DONE BY THE CONCERNED AUTHORITIES IN THAT MANNER ALONE AS HAS BEEN PRESCRIBED UNDER THE LAW ELSE IT SHALL BE TATA SONS LTD. 17 DEEMED THAT THE SAID ACT HAS NEVER BEEN DONE. HE RE QUESTED FOR QUASHING THE ASSESSMENT ORDER ON THE GROUND THA T SAME WAS PASSED WITHOUT AUTHORITY OF LAW AND WAS VOID AB-INITIO . 3.20 . WE HAVE GONE THROUGH ALL THE FACTS AND CIRCUMSTAN CES OF THE CASE. IT IS NOTED BY US THAT FOR THE IMPUGNED A SSESSMENT YEAR AFTER THE RETURN WAS FILED BY THE ASSESSEE A NOTICE WAS ISSUED BY THE ACIT CIR-2(3) MUMBAI DATED 5 TH SEPTEMBER 2001 INTIMATING THE ASSESSEE ABOUT CHANGE IN JURIS DICTION AND CLAIMING THAT JURISDICTIONAL WAS WITH THE SAID OFFICER. THE RELEVANT PART OF THE SAID NOTICE IS REPRODUCED HERE UNDER: SUB: CHANGE IN JURISDICTION-INTIMATION REGARDING IN TERMS OF NOTIFICATION NO. SO NO. 732(E) DATED 31 .7.2001 OF CENTRAL BOARD OF DIRECT TAXES AND CONSEQUENTIAL NOTIFICATION DATED 7.8.2001 OF CIT. MC-II MUMBAI JURISDICTION OVER YOUR CASE WITH EFFECT FROM 1.8.20 01 VESTS WITH THE UNDERSIGNED. ALL IT./W.T. AND INTEREST TAX RETURNS AND NECESSARY CORRESPONDENCE ON THAT ACCOUN T ARE THEREFORE REQUIRED TO BE FILED WITH THE UNDERSI GNED. ALL PAYMENTS TOWARDS INCOME-TAX (BY WAY OF ADVANCE TAX REGULAR TAX OR S.A. TAX) INTEREST TAX WEALTH TAX AND PAYMENT U/S. 115-0 OF THE I.T. ACT ARE ALSO TO BE MADE W.E.F. 1.8.2001 TO THE CREDIT OF THE ACIT CIRC LE 2(3) MUMBAI. 2. SIMILARLY JURISDICTION OVER THE MANAGING DIRECT OR DIRECTOR MANAGER AND SECRETARY OF YOUR COMPANY AL SO VESTS WITH THE UNDERSIGNED VIDE NOTIFICATIONS QUOTE D SUPRA. CONSEQUENTLY ALL THE RETURNS OF THE ABOVE P ERSONS AND FOLLOW UP CORRESPONDENCES ON THAT ACCOUNT ARE T O BE MADE WITH THE UNDERSIGNED. ALL PAYMENTS TOWARDS INCOME-TAX AND WEALTH-TAX W.E.F 01.08.2001 OF THE ABOVE PERSONS ARE ALSO TO BE MADE TO THE CREDIT OF ACIT CIR.2(3) MUMBAI. THIS MAY BE CAREFULLY NOTED. YOURS FAITHFULLY SD/- (JAGADISH PRASAD JANGID) ACIT CIR. 2(3) MUMBAI. TATA SONS LTD. 18 3.21. THUS FROM THE ABOVE IT IS CLEAR THAT INITIALLY TH E JURISDICTION WAS WITH ACIT CIR. 2(3) MUMBAI FOR P ASSING THE ASSESSMENT ORDER. SUBSEQUENTLY A NOTICE U/S 143(2) WAS ISSUED BY DCIT CIR. 2(3) DATED 01.12.2003 WHO WAS I NDEED SUCCESSOR TO THE FIRST OFFICER. SUBSEQUENTLY ASSES SEE RECEIVED A QUESTIONNAIRE DATED 10 TH DECEMBER 2004 FROM THE ADDITIONAL CIT RANGE 2(3) MUMBAI. APPARENTLY ADDITIONAL COMMI SSIONER OF INCOME TAX WAS NOT SUCCESSOR OF ACIT/DCIT WHO HA D ISSUED EARLIER NOTICE. BUT THE ASSESSEE HAS CONTEN DED THAT THERE IS NOTHING ON RECORD TO SHOW AS TO HOW THE AD DITIONAL COMMISSIONER OF INCOME TAX BECAME AO OF THE ASSESSE E AND PASSED THE IMPUGNED ASSESSMENT ORDER. 3.22. THUS THE FIRST ISSUE RAISED BY THE ASSESSEE BEFORE US IS THAT IN THIS CASE ASSESSMENT PROCEEDINGS WERE INITI ATED BY THE ASSISTANT COMMISSIONER OF INCOME TAX BUT WERE TAKEN OVER IN THE MIDDLE OF THE PROCEEDINGS BY THE ADDITIONAL COM MISSIONER OF INCOME TAX AND COMPLETED BY HIM WITHOUT THERE BE ING ANY VALID TRANSFER OF JURISDICTION FROM THE ASSISTANT C OMMISSIONER OF INCOME TAX TO THE ADDITIONAL COMMISSIONER OF INC OME TAX AS REQUIRED UNDER SECTION 127 OF THE INCOME TAX ACT . IN THIS REGARD LD. CIT-DR WAS OF THE VIEW THAT THE ADDITIO NAL COMMISSIONER OF INCOME TAX AND ASSISTANT COMMISSION ER OF INCOME TAX HAVE CONCURRENT JURISDICTION OVER THE AS SESSEE. IN OUR VIEW CONTENTION OF LD. CIT-DR IS NOT VALID AS IT IS NOT BASED UPON CORRECT APPRECIATION OF THE LAW. IT APP EARS THAT REVENUE HAS MISUNDERSTOOD AND MISS-APPLIED THE VERY CONCEPT OF CONCURRENT JURISDICTION AND HAS IGNORE D THE DISTINCTION BETWEEN THE CONCURRENT JURISDICTION A ND JOINT TATA SONS LTD. 19 JURISDICTION. WHEN WE TALK ABOUT ASSIGNMENT OF C ONCURRENT JURISDICTION TO TWO OFFICERS OF DIFFERENT HIERARCH Y IT DOES NOT MEAN THAT BOTH THE OFFICERS CAN SIMULTANEOUSLY OR J OINTLY WORK UPON THE ASSESSMENT PROCEEDINGS OF SAME ASSESSEE. B UT IT MEANS THAT BOTH THE OFFICERS ARE LEGALLY ELIGIBLE F OR ASSIGNMENT OF JURISDICTION OF THE ASSESSMENT PROCEEDINGS OF AN ASSESSEE AND THEREFORE ANY ONE OF THESE OFFICERS CAN BE AS SIGNED THE JURISDICTION BY THE HIGHER AUTHORITY. BUT EXERCIS E OF THE JURISDICTION BETWEEN BOTH THE OFFICERS SHALL ALWAYS BE MUTUALLY EXCLUSIVE TO EACH OTHER. IF THE JURISDICTION HAS BE EN ASSIGNED TO ONE OF THE OFFICERS IT SHALL NOT BE EXERCISED BY T HE OTHER AND IF THE JURISDICTION IS TAKEN AWAY FROM THE FORMER OFFI CER AND ASSIGNED TO THE LATTER THEN IT SHALL BE EXERCISED BY THE LATTER ONLY AND NOT BY THE FORMER. THUS THE JURISDICTION CAN BE EXERCISED BY ONLY ONE ASSESSING OFFICER AT ANY GIVE N POINT OF TIME WHO HAS BEEN DULY ASSIGNED THE JURISDICTION BY THE COMPETENT AUTHORITY. THE ASSIGNMENT OF JURISDICTION TO AN OFFICER AND ITS TRANSFER FROM ONE OFFICER TO THE OT HER CAN BE MADE ONLY THROUGH THE PRESCRIBED PROCESS OF LAW. S ECTION 127 OF THE ACT CONTAINS PROVISIONS REGARDING PROCESS TO BE FOLLOWED BY THE REVENUE OFFICERS AND THEIR POWERS FOR TRANSF ER OF CASES FROM ONE ASSESSING OFFICER TO THE OTHER. SECTION 1 27(1) INTER- ALIA PROVIDES AND MANDATES THAT THE COMMISSIONER MAY A FTER RECORDING HIS REASONS FOR DOING SO TRANSFER ANY CA SE FROM ONE ASSESSING OFFICER SUBORDINATE TO HIM TO ANY OTHER ASSESSING OFFICER (WHETHER WITH OR WITHOUT CONCURRENT JURISDI CTION) ALSO SUBORDINATE TO HIM. THUS MANDATORY REQUIREMENT OF THE LAW IN THIS REGARD IS THAT AN ORDER IN WRITING MUST BE PASSED BY THE TATA SONS LTD. 20 JURISDICTIONAL COMMISSIONER OF INCOME TAX FOR EFFEC TING TRANSFER OF ASSESSMENT PROCEEDINGS FROM ONE ASSESSI NG OFFICER TO THE OTHER. LAW IN THIS REGARD WAS EXPLAINED IN DETAIL BY HONBLE DELHI HIGH COURT IN THE CASE OF VALVOLINES CUMMINS SUPRA. SIMILAR VIEW WAS TAKEN BY THE DELHI BENCH O F THE TRIBUNAL IN THE CASE OF MEGA CORPORATION LTD. VS. ADDITIONAL CIT SUPRA FOLLOWING THE AFORESAID JUDGMENT OF THE DELH I HIGH COURT. RELEVANT PART OF ORDER IS REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE:- 9. ANOTHER CONTENTION SPECIFICALLY RAISED IS THAT T HERE IS NO TRANSFER ORDER U/S 127 OF THE ACT FROM TRANSF ERRING THE CASE FROM THE DCIT TO THE ADDL. CIT RANGE 6 A ND NEW DELHI. THE LEARNED CIT(A) HAS HELD THAT IN THE CASE S OF TRANSFER OF CASES TO ANOTHER AO AFTER ISSUE OF NOTI CE U/S 143(2) OF THE ACT BY ANOTHER AO THE ISSUE INVOLVES THE INTERPRETATION OF CONCURRENT JURISDICTION WHICH IS BEYOND THE SCOPE OF THIS APPEAL WITHIN THE RESTRICTED DIRE CTIONS OF THE HONBLE ITAT. HE HAS HELD THAT IN MY CONSIDER ED OPINION SINCE BOTH ADDL. CIT RANGE-6 AND DCIT CIRC LE-6(1) WORKS AS SUBORDINATE OFFICER TO THE SAME CIT AND TH E CIT HAVING ENTIRE TERRITORIAL JURISDICTION THE PASSING OF ASSESSMENT ORDER BY THE ADDL. CIT AFTER ISSUE OF NO TICE U/S 143(2) BY THE DCIT CIRCLE 6(1) DOES NOT AFFECT THE TAXABILITY OF THE APPELLANT OR APPELLANT IS NOT ADV ERSELY AFFECTED BY THE ORDER. THE HONBLE DELHI HIGH COURT IN THE ABOVE CONTEXT IN THE CASE OF VALVOLINE CUMMINS LTD . (SUPRA) HAS HELD AS UNDER: 28. ON THE ISSUE OF CONCURRENT JURISDICTION BETW EEN THE ADDITIONAL COMMISSIONER AND THE DEPUTY COMMISSIONER LEARNED COUNSEL FOR THE ASSESSEE RELIED UPON A DECI SION OF THE CALCUTTA HIGH COURT IN BERGER PAINTS INDIA LTD. V. ASSTT. CIT [2000] 246 ITR 133. THE CALCUTTA HIGH CO URT HAD EXPLAINED THE MEANING OF THE EXPRESSION CONCUR RENT TO MEAN TWO AUTHORITIES HAVING EQUAL POWERS TO DEAL WITH A SITUATION -BUT THE SAME WORK CANNOT BE DIVIDED BE TWEEN THEM. THIS IS WHAT THE CALCUTTA HIGH COURT HAD TO S AY: '. . . CONCURRENT JURISDICTION MEANS A SUBORDINATE AUTHORITY CAN DEAL WITH THE MATTER EQUALLY WITH ANY SUPERIOR TATA SONS LTD. 21 AUTHORITY IN ITS ENTIRETY SO THAT EITHER ONE OF SUC H JURISDICTIONS CAN BE INVOKED. IT CANNOT BE CONSTRUE D AS CONCURRENT JURISDICTION WHEN ONE PART OF THE ASSESS MENT WILL BE DEALT WITH BY ONE SUPERIOR OFFICER AND THE OTHER PART WILL BE DEALT WITH BY ONE SUBORDINATE OFFICER. . . .' IT APPEARS TO US QUITE CLEARLY THAT THERE IS A DISTINCTION BETWEEN CONCURRENT EXERCISE OF POWER AND JOINT EXERCISE OF POWER. WHEN POWER HAS BEEN CONFERRED UPON TWO AUTHORITIES CONCURRENTLY EITHER ONE OF THEM CAN EXERCISE THAT POWER AND ONCE A DECISION IS TAKEN TO EXERCISE THE POWER BY ANY ONE OF THOSE AUTHORITIES THAT EXERCISE MUST BE TERMINATED BY THAT AUTHORITY ONLY. IT IS NOT THAT ONE AUTHORIT Y CAN START EXERCISING A POWER AND THE OTHER AUTHORIT Y HAVING CONCURRENT JURISDICTION CAN CONCLUDE THE EXERCISE OF THAT POWER. THIS PERHAPS MAY BE PERMISSIBLE IN A SITUATION WHERE BOTH THE AUTHORITI ES JOINTLY EXERCISE POWER BUT IT CERTAINLY IS NOT PERMISSIBLE WHERE BOTH THE AUTHORITIES CONCURRENTLY EXERCISE POWER. ONE EXAMPLE THAT IMMEDIATELY COMES TO THE MIND IS THAT OF GRANT OF ANTICIPATORY BAIL. BOT H THE SESSIONS JUDGE AND THE HIGH COURT HAVE CONCURRENT POWER. IT IS NOT AS IF A PART OF THAT POWER CAN BE EXERCISED BY THE HIGH COURT AND THE BALANCE POWER CAN BE EXER CISED BY THE SESSIONS JUDGE. IF THE HIGH COURT IS SEIZED OF AN APPLICATION FOR ANTICIPATORY BAIL IT MUST DEAL WITH IT AND SIMILARLY IF THE SESSIONS JUDGE IS SEIZED OF AN ANT ICIPATORY BAIL HE MUST DEAL WITH IT. THERE CAN BE NO JOINT E XERCISE OF POWER BOTH BY THE HIGH COURT AS WELL AS BY THE SESS IONS JUDGE IN RESPECT OF THE SAME APPLICATION FOR ANTICI PATORY BAIL. 30. IN THE FACTS OF THE PRESENT CASE SINCE THE ADD ITIONAL COMMISSIONER HAD EXERCISED THE POWER OF AN ASSESSIN G OFFICER HE WAS REQUIRED TO CONTINUE TO EXERCISE TH AT POWER TILL HIS JURISDICTION IN THE MATTER WAS OVER. HIS J URISDICTION IN THE MATTER WAS NOT OVER MERELY ON THE PASSING OF THE ASSESSMENT ORDER BUT IT CONTINUED IN TERMS OF SECTI ON 220(6) OF THE ACT IN DEALING WITH THE PETITION FOR STAY. WHAT HAS HAPPENED IN THE PRESENT CASE IS THAT AFTER HAVI NG PASSED THE ASSESSMENT ORDER THE ADDITIONAL COMMISSIONER SEEMS TO HAVE WASHED HIS HANDS OF THE MATTER AND LEFT IT TO THE DEPUTY COMMISSIONER TO DE CIDE THE TATA SONS LTD. 22 STAY PETITION FILED UNDER SECTION 220(6) OF THE ACT . WE ARE OF THE OPINION THAT THIS WAS NOT PERMISSIBLE IN LAW . 9.1 WE THEREFORE HOLD THAT APPLYING THE ABOVE JUDIC IAL POSITION THAT ASSESSMENT HAS TO BE COMPLETED BY THE AUTHORITY WHO HAS INITIATED THE PROCEEDINGS FOR MAK ING ASSESSMENT AND ANY OTHER AUTHORITY CAN TAKE OVER TH E PROCEEDINGS ONLY AFTER A PROPER ORDER OF TRANSFER U /S 127(1) OR 127(2) OF THE PROCEEDINGS. THE REVENUE HA S NOT BROUGHT ANY ORDER FOR TRANSFER OF THE PROCEEDINGS F ROM DCIT CIRCLE-6(1) NEW DELHI TO THE ADDITIONAL CIT RANGE- 6 NEW DELHI AND THEREFORE IT IS QUITE EVIDENT THAT THE ADDITIONAL CIT RANGE-6 TOOK OVER THE ASSESSMENT PROCEEDINGS WITHOUT THERE BEING AN ORDER U/S 127(1) . IN THE CASE OF PRACHI LEATHERS PVT. LTD. (SUPRA) IT H AS BEEN HELD AS UNDER: 19. WE ARE FURTHER OF THE OPINION THAT THE NOTICE U NDER SECTION 143(2) OF THE ACT HAVING BEEN ISSUED BY THE INCOME-TAX OFFICER RANGE 6(2) KANPUR ON 16.8.2002 IT WAS INCOME-TAX OFFICER ALONE WHO COULD FRAME THE ASSESSMENT SUBJECT HOWEVER TO THE FACT THAT THAT TH E ASSESSMENT COULD BE FRAMED BY ANY OTHER OFFICER ALS O PROVIDED THERE WAS AN ORDER OF TRANSFER OF JURISDIC TION OVER ASSESSEES CASE FROM INCOME-TAX OFFICER RANGE-6(2) KANPUR TO THAT OFFICER UNDER SECTION 127(4) OF THE ACT BUT SO FAR AS PRESENT CASE IS CONCERNED THE REVENUE HA S NOT BROUGHT TO OUR NOTICE ANY ORDER UNDER SECTION 127 P ASSED AFTER 6.8.2002 TRANSFERRING JURISDICTION OVER THE A SSESSEES CASE FROM THE INCOME-TAX OFFICER RANGE 6(2) KANPU R TO THE ADDL. CIT RANGE-6 KANPUR AND THEREFORE THE ASSESS MENT FRAMED BY THE ADDL.CIT RANGE-6 KANPUR IRRESPECTIVE OF THE FACT AS TO WHETHER HE WAS AUTHORIZED TO PERFORM THE FUNCTIONS OF AN AO OR NOT IS ILLEGAL AND VOID AB I NITIO FOR WANT OF JURISDICTION. CONSEQUENTLY WE ARE OF THE O PINION THAT THE ASSESSMENT ORDER IN THE PRESENT CASE DATED 31.3.2003 PASSED BY THE ADDL.CIT RANGE (6) KANPUR WAS ILLEGAL AND VOID AB INITIO FOR WANT OF JURISDICTION . CONSEQUENTLY THE ASSESSMENT ORDER IS QUASHED. 9.2 CONSEQUENTLY ON THIS COUNT ALSO THE ASSESSMENT MADE ON 29.12.2008 BY THE ADDITIONAL COMMISSIONER IS ILL EGAL AND BAD IN LAW FOR WANT OF JURISDICTION. 10. FOR THE REASONS AFORESAID WE HOLD THAT THE ORDE R OF ASSESSMENT DATED 29.12.2008 WAS WITHOUT JURISDICTIO N TATA SONS LTD. 23 AND THEREFORE IS QUASHED AS SUCH. IN RESULT GROUND NOS. 1 AND 2 ARE ALLOWED. 3.23. IN THE CASE BEFORE US THE FACTS ARE IDENTICAL. IT IS NOTED THAT LD. CIT-DR AS WELL AS THE ASSESSING OFFICER (P RESENT INCUMBENT) WHO WAS PERSONALLY PRESENT DURING THE CO URSE OF HEARING BEFORE US JOINTLY STATED THAT NO SUCH ORDE R (AS PRESCRIBED UNDER SECTION 127(1) REQUIRED TO BE PASS ED BY THE JURISDICTIONAL COMMISSIONER OF INCOME TAX) IS AVAIL ABLE IN THE RECORDS. THUS IT IS CLEAR THAT THERE WAS NO VALID TRANSFER OF JURISDICTION TO THE ADDITIONAL COMMISSIONER OF INCO ME TAX WHO HAD PASSED THE IMPUGNED ASSESSMENT ORDER. THUS IMP UGNED ASSESSMENT ORDER HAD BEEN PASSED WITHOUT ASSUMING JURISDICTION AS PER LAW. 3.24. NEXT ISSUE RAISED BY THE LD. SENIOR COUNSEL WAS THAT THE ADDITIONAL COMMISSIONER WHO HAD PASSED THE IMPU GNED ASSESSMENT ORDER WAS NOT AUTHORIZED TO ACT AS ASSES SING OFFICER OF THE ASSESSEE AND PASS THE IMPUGNED ASSES SMENT ORDER. WE ANALYZED THE PROVISIONS OF LAW IN THIS RE GARD AND FIND THAT SECTION 2(7A) DEFINES THE TERM OF ASSESSI NG OFFICER AS UNDER: ASSESSING OFFICER' MEANS THE ASSISTANT COMMISSIONE R OR DEPUTY COMMISSIONER OR ASSISTANT DIRECTOR OR DEPUTY DIRECTOR OR THE INCOME-TAX OFFICER WHO IS VESTED WI TH THE RELEVANT JURISDICTION BY VIRTUE OF DIRECTIONS OR OR DERS ISSUED UNDER SUB-SECTION (1) OR SUBSECTION (2) OF S ECTION 120 OR ANY OTHER PROVISION OF THIS ACT AND THE JOI NT COMMISSIONER OR JOINT DIRECTOR WHO IS DIRECTED UNDE R CLAUSE (B) OF SUB-SECTION (4) OF THAT SECTION TO EX ERCISE OR PERFORM ALL OR ANY OF THE POWERS AND FUNCTIONS CONF ERRED ON OR ASSIGNED TO AN ASSESSING OFFICER UNDER THIS ACT. 3.25. SUBSEQUENTLY THE WORD ADDITIONAL COMMISSIONER W AS ALSO ADDED IN THE SAID DEFINITION BY FINANCE ACT 2 007 WITH TATA SONS LTD. 24 RETROSPECTIVE EFFECT FROM DAY 01.06.1994. THUS FRO M THE ABOVE IT IS CLEAR THAT WHEN THE IMPUGNED ASSESSMEN T ORDER WAS PASSED DEFINITION OF THE WORD ASSESSING OFFIC ER DID NOT INCLUDE ADDITIONAL COMMISSIONER OF INCOME TAX. IT IS FURTHER NOTED THAT SECTION 2(28C) DEFINES JOINT COMMISSIONE R. SECTION 2(28C) WAS AVAILABLE ON STATUTE SINCE 01.10.1998 AN D PROVIDE AS UNDER: 2(28C) JOINT COMMISSIONER MEANS A PERSON APPOINTED TO BE A JOINT COMMISSIONER OF INCOME TAX OR AN ADDITIO NAL COMMISSIONER OF INCOME TAX UNDER SUB-SECTION (1) OF SECTION 117. ON THE OTHER HAND SECTION 2(1C) DEFINES ADDITIONA L COMMISSIONER AS UNDER: ADDITIONAL COMMISSIONER MEANS A PERSON AS APPOINTE D TO BE AN ADDITIONAL COMMISSIONER OF INCOME TAX UNDER S UB- SECTION (1) OF SECTION 117. THUS COMBINED READING OF ALL THE ABOVE SECTIONS MA KES IT CLEAR THAT PRIOR TO AMENDMENT MADE BY FINANCE ACT 2007 THE LEGISLATURE TREATED ADDITIONAL COMMISSIONER AND JOINT COMMISSIONER DIFFERENTLY FOR THE PURPOSES OF PERFO RMING THE ROLE AS AN ASSESSING OFFICER DESPITE THE FACT THAT FOR ALL THE OTHER PURPOSES JOINT COMMISSIONER MEANT ADDITION AL COMMISSIONER AS WELL AS PER SECTION 2(28C). IT IS CLEAR FROM THE FACTS THAT BY WAY OF SUBSEQUENT AMENDMENT BY FI NANCE ACT 2007 WORDS ADDITIONAL COMMISSIONER HAVE ALS O BEEN INSERTED ALONG WITH WORDS JOINT COMMISSIONER IN S ECTION 2(7A) WHICH DEFINES THE TERM FOR ASSESSMENT OFFICE R . IN CASE THE LEGISLATURE WOULD HAVE INTENDED AND MEANT THAT FOR THE TATA SONS LTD. 25 PURPOSE OF ACTING AS ASSESSING OFFICER JOINT COMM ISSIONER AND ADDITIONAL COMMISSIONER MEANS ONE AND THE SAM E THEN THERE WAS NO NEED TO COME OUT WITH AN AMENDMENT MAD E BY FINANCE ACT 2007 WHEREIN THE WORD ADDITIONAL COMMISSIONER WAS ALSO INSERTED IN THE DEFINITION O F ASSESSING OFFICER AS CONTAINED IN SECTION 2(7A). THUS IT IS CLEAR AS PER THE PLAIN READING OF THE STATUTE THAT WHEN THE ASSE SSMENT ORDER WAS PASSED THE ADDITIONAL COMMISSIONER WAS NOT AUTHORIZED TO ACT AS ASSESSING OFFICER. 3.26 . IN ADDITION TO THE ABOVE IT FURTHER NOTED BY US THAT ONLY THAT JOINT COMMISSIONER WAS AUTHORIZED TO ACT AS AN ASSESSING OFFICER WHO WAS DIRECTED UNDER CLAUSE (B) OF SUB- SECTION 4 OF SECTION 120 TO EXERCISE OR PERFORM ALL OR ANY OF THE POWERS AND FUNCTIONS OF AN ASSESSING OFFICER AS DEF INED U/S 2(7A) OF THE ACT. NOW IF WE REFER TO SECTION 120 ITS PERUSAL MAKES FURTHER CLEAR THAT ONLY CBDT CAN EMPOWER THE CHIEF COMMISSIONERS OR COMMISSIONERS FOR ISSUANCE OF ORDE RS TO THE EFFECT THAT POWERS AND FUNCTIONS OF AN ASSESSING OF FICER FOR A PARTICULAR ASSESSEE OR CLASSES OF ASSESSEE SHALL BE EXERCISED BY A JOINT COMMISSIONER. DESPITE NUMEROUS DIRECTIONS THE REVENUE WAS NOT ABLE TO BRING BEFORE US ANY ORDER W HEREIN ANY SPECIFIC AUTHORITY WAS GIVEN BY ANY CHIEF COMMISSIO NER OR COMMISSIONER AUTHORIZING THE IMPUGNED ADDITIONAL COMMISSIONER TO PASS IMPUGNED ASSESSMENT ORDER. WE FIND FORCE IN THE ARGUMENT OF LD. COUNSEL THAT AT THE RE LEVANT TIME WHEN THE ASSESSMENT PROCEEDINGS WERE IN PROGRESS T HE WORD ADDITIONAL COMMISSIONER WAS NOT AVAILABLE IN THE AFORESAID SECTION AND THEREFORE IT WAS NOT POSSIBLE FOR THE CHIEF TATA SONS LTD. 26 COMMISSIONER OR THE COMMISSIONER TO HAVE AUTHORIZED AN ADDITIONAL COMMISSIONER FOR EXERCISING POWERS AND F UNCTIONS OF AN ASSESSING OFFICER FOR A PARTICULAR ASSESSEE O R CLASSES OF ASSESSEE. EVEN OTHERWISE NO ORDER COULD BE SHOWN T O US WHEREBY ANY SUCH AUTHORITY WAS GIVEN TO THE JOINT COMMISSIONER OF THE RANGE. UNDER THESE CIRCUMSTANCE S WE FIND THAT THE REVENUE IS NOT ABLE TO SHOW ANY ORDER OR NOTIFICATION IN FAVOUR OF THE ADDITIONAL COMMISSION ER AUTHORIZING HIM FOR PERFORMING THE POWERS AND FUNCT IONS OF THE ASSESSING OFFICER OF THE ASSESSEE. 3.27. DURING THE COURSE OF HEARING LD. CIT-DR HAD DRAW N OUR ATTENTION UPON BOARDS NOTIFICATION NO.267/2001 DATED 17-9-2001 NOTIFICATION NO.228/2001 DATED 31.7.2001 AND NOTIFICATION NO.335/2001 DATED 29-10-2001 WITH A VI EW TO ARGUE THAT THE JURISDICTION WAS ASSIGNED TO ALL TH E OFFICERS INCLUDING ADDITIONAL COMMISSIONER FOR EXERCISE OF POWERS AS ASSESSING OFFICER AND THUS THE ADDITIONAL COMMISS IONER OF INCOME TAX WHO HAD PASSED THE IMPUGNED ASSESSMENT ORDER HAD INHERENT POWERS UNDER THE LAW TO ACT AS ASSESSI NG OFFICER OF THE ASSESSEE AND PASS THE IMPUGNED ASSESSMENT OR DER. 3.28. WE HAVE GONE THROUGH ALL THESE NOTIFICATIONS BUT D O NOT FIND ANY SUBSTANCE IN THE CONTENTION OF THE LD. CIT -DR. IT IS NOTED THAT NOTIFICATION NO.335 IS ISSUED MERELY FOR ASSIGNING JURISDICTION TO VARIOUS COMMISSIONERS AND IT IS THU S OF NO USE TO REVENUE AS FAR AS ISSUE BEFORE US IS CONCERNED. SO FAR AS NOTIFICATION NO.267/2001 IS CONCERNED IT READS AS FOLLOWS:- IN EXERCISE OF THE POWERS CONFERRED BY CLAUSE(B) OF SUB- SECTION (4) OF SECTION 120 OF THE INCOME TAX ACT 1 961(43 OF 1961) THE CENTRAL BOARD OF DIRECT TAXES HEREBY DI RECTS TATA SONS LTD. 27 THAT THE JOINT COMMISSIONERS OF INCOME TAX OR THE J OINT DIRECTORS OF INCOME TAX SHALL EXERCISE THE POWERS AND FUNCTIONS OF THE ASSESSING OFFICERS IN RESPECT OF TERRITORIAL AREA OR PERSONS OR CLASSES OF PERSONS OR INCOMES OR CLASSES OF INCOME OR CASES OR CLASSES OF CASES IN RESPECT OF WHICH SUCH JOINT COMMISSIONERS OF INCOME TAX ARE AUTHORISED BY THE COMMISSIONER OF INCOME TAX VIDE GOVERNMENT OF INDIA CENTRAL BOARD OF DIRECT T AXES NOTIFICATION NUMBER S.O.732(E) DATED 31.07.2001 S.O.880(E) DATED 14.09.2001 S.O.881(E) DATED 14.09.2001 S.O. 882(E) DATED 14.09.2001 AND S.O. 883(E) DATED 14.09.2001 PUBLISHED IN THE GAZETTE OF INDIA PART II SECTION 3 SUB-SECTION (II) EXTRAORDINARY . (EMPHASIS SUPPLIED) 3.29. PERUSAL OF THE AFORESAID NOTIFICATION REVEALS THAT ONLY THOSE JOINT COMMISSIONERS SHALL EXERCISE THE POWERS AND FUNCTIONS OF THE ASSESSING OFFICERS WHO HAVE BEEN A UTHORIZED BY THE CONCERNED COMMISSIONERS OF INCOME TAX IN PUR SUANCE TO THE RELEVANT NOTIFICATION CONFERRING REQUISITE P OWERS TO THE CONCERNED COMMISSIONERS. 3.30. SIMILARLY NOTIFICATION NO.228/2001 SUPRA AUTHORIZ E THE COMMISSIONERS OF INCOME TAX TO ISSUE ORDERS FOR AUT HORIZING IN TURN THE JOINT COMMISSIONER OF INCOME TAX WHO ARE SUBORDINATE TO THEM FOR EXERCISING OF THE POWERS A ND PERFORMANCE OF THE FUNCTIONS OF THE ASSESSING OFFIC ERS. IT ALSO INTER-ALIA AUTHORIZES THE JOINT COMMISSIONERS WHO WERE SO AUTHORIZED BY THE COMMISSIONERS TO ISSUE ORDERS IN WRITING TO THE OFFICERS WHO ARE SUBORDINATE TO THEM FOR THE EX ERCISE OF THE POWERS AND PERFORMANCE OF THE FUNCTIONS OF THE ASSESSING OFFICERS FOR SPECIFIED ASSESSEE OR CLASS OF ASSESSE E. RELEVANT PART OF THE SAID NOTIFICATION IS REPRODUCED AS UNDE R FOR THE SAKE OF READY REFERENCE:- TATA SONS LTD. 28 (C) AUTHORISE THE COMMISSIONER OF INCOME TAX REF ERRED TO IN THIS NOTIFICATION TO ISSUE THE ORDERS IN WRIT ING FOR THE EXERCISE OF THE POWERS AND PERFORMANCE OF THE FUNCT IONS OF THE JOINT COMMISSIONERS OF INCOME TAX WHO ARE SUBORDINATE TO THEM IN RESPECT OF SUCH CASES OR CL ASSES OF CASES SPECIFIED IN THE CORRESPONDING ENTRIES IN COL UMN(6) OF THE SCHEDULE-I AND SCHEDULE II OF SUCH PERSONS OR CLASSES OF PERSONS SPECIFIED IN THE CORRESPONDING ENTRIES I N COLUMN(5) OF THE SAID SCHEDULES IN SUCH TERRITORIA L AREAS SPECIFIED IN THE CORRESPONDING ENTRIES IN COLUMN (4 ) OF THE SAID SCHEDULES AND IN RESPECT ALL OF INCOMES OR CL ASSES OF INCOME; (D) AUTHORISES THE JOINT COMMISSIONER OF INCOME TAX REFERRED TO IN CLAUSE (C) OF THIS NOTIFICATION TO ISSUE ORDERS IN WRITING FOR THE EXERCISE OF THE POWERS AND PERFO RMANCE OF THE FUNCTIONS BY THE ASSESSING OFFICERS WHO ARE SUBORDINATE TO THEM IN RESPECT OF SUCH SPECIFIED A REA OR PERSONS OR CLASSES OF PERSONS OR INCOMES OR CLASSES OF INCOME OR CASES OR CLASSES OF CASES IN RESPECT OF WHICH SUCH JOINT COMMISSIONERS OF INCOME TAX ARE AUTHORIS ED BY THE COMMISSIONER OF INCOME TAX UNDER CLAUSE (C) OF THIS NOTIFICATION 3.31. THUS IN VIEW OF THE AFORESAID NOTIFICATION IT BECO MES IMPERATIVE ON THE PART OF THE REVENUE TO SHOW US TH AT IN THE CASE BEFORE US THE ADDITIONAL COMMISSIONER OF INCO ME TAX WHO HAD PASSED THE IMPUGNED ASSESSMENT ORDER WAS D ULY AUTHORIZED BY THE JURISDICTIONAL COMMISSIONER TO DO SO. IT IS NOTED THAT ANY SUCH ORDER WOULD NOT BE AVAILABLE WI TH THE REVENUE BECAUSE EVEN IN THE NOTIFICATIONS DISCUSSE D ABOVE ONLY JOINT COMMISSIONERS WERE AUTHORIZED TO PERFO RM THE ROLE OF THE ASSESSING OFFICERS. HOWEVER THE REVENUE IS NOT ABLE TO BRING BEFORE US ANY ORDER OF THE COMMISSIONER AUTHO RIZING EVEN THE JOINT COMMISSIONER TO PERFORM POWERS AND FUNCTIONS OF ASSESSING OFFICER OF THE ASSESSEE. AS PER THE DISCUSSION MADE BY US IN DETAIL IN THE EARLIER PART OF OUR ORDER IT IS CLEAR THAT NO SUCH ORDER IS AVAILABLE IN THE ASSESSMENT TATA SONS LTD. 29 RECORD OR IN ANY OTHER RECORD. LEGAL CONSEQUENCES OF THE SAME HAVE BEEN ELABORATELY ANALYSED IN MANY JUDGMEN TS BY VARIOUS COURTS. 3.32. IDENTICAL ISSUE CAME UP FOR CONSIDERATION BEFORE DE LHI BENCH OF INCOME TAX APPELLATE TRIBUNAL IN THE CASE OF MEGA CORPORATION SUPRA. THE BENCH DISCUSSED ENTIRE LAW AVAILABLE ON THIS ISSUE AND HELD THAT AN ADDITIONAL COMMISSI ONER OF INCOME TAX CANNOT IPSO FACTO EXERCISE THE POWERS OR PERFORM THE FUNCTION OF AN ASSESSING OFFICER UNDER THE ACT. HE CAN PERFORM THE FUNCTIONS AND EXERCISE THE POWERS OF AN ASSESSING OFFICER ONLY IF HE IS SPECIFICALLY DIRECTED UNDER S ECTION 120(4)(B) OF THE ACT TO DO SO. RELEVANT PART OF THE OBSERVAT IONS OF THE BENCH IS REPRODUCED HEREUNDER FOR THE SAKE OF READY REFERENCE:- .. WE HAVE CONSIDERED THE ARGUMENTS ADVANCED BY THE PARTIES AND PERUSED THE ORDER OF THE LEARNED CI T(A) COMMENTS OF THE ASSESSING OFFICER AND MATERIAL PLAC ED ON RECORD. THE CONTROVERSY RAISED IN THIS APPEAL RELAT ES TO THE VALIDITY OF ORDER OF ASSESSMENT DATED 29.12.2008 PA SSED BY ADDITIONAL CIT RANGE 6 NEW DELHI. ACCORDING TO THE APPELLANT/ASSESSEE IT IS INCUMBENT UNDER THE SCHEM E OF STATUTE TO VEST THE ADDITIONAL CIT U/S 120(4)(B) OF THE ACT TO EXERCISE OR PERFORM ALL OR ANY OF THE POWERS AND FU NCTIONS OF ASSESSING OFFICER UNDER THE ACT. 5.1 TO EXAMINE THE ABOVE CONTENTION WE CONSIDER IT APPROPRIATE TO FIRSTLY EXTRACT SECTION 2(7A) OF THE ACT WHICH READS AS UNDER: 2(7A) ASSESSING OFFICERS (7A) 'ASSESSING OFFICER' MEANS THE ASSISTANT COMMISSIONER OR 2 DEPUTY COMMISSIONER 3 OR ASSISTANT DIRECTOR 4 OR DEPUTY DIRECTOR OR THE INCOME-TAX OFFICER WHO IS VESTED WITH THE RELEVANT JURISDICTION BY VIRTUE OF DIRECTIONS OR ORDERS ISSUED UNDER SUB-SECTION (1)OR SUB- SECTION (2) OF SECTION 120 OR ANY OTHER PROVISION O F THIS ACT AND THE 6 [ADDITIONAL COMMISSIONER OR] 6 7 [ADDITIONAL TATA SONS LTD. 30 DIRECTOR OR] 7 5 JOINT COMMISSIONER OR JOINT DIRECTOR WHO IS DIRECTED UNDER CLAUSE (B) OF SUB-SECTION (4) OF THA T SECTION TO EXERCISE OR PERFORM ALL OR ANY OF THE POWERS AND FUNCTIONS CONFERRED ON OR ASSIGNED TO AN ASSESSIN G OFFICER UNDER THIS ACT; 5.2 A PLAIN READING OF THE AFORESAID PROVISION WOUL D SHOW THAT IT IS IN TWO PARTS. THE FIRST PART PROVIDES TH AT ASSESSING OFFICER MEANS THE ASSISTANT COMMISSIONER OR DEPUTY COMMISSIONER OR ASSISTANT DIRECTOR OR D EPUTY DIRECTOR OR INCOME TAX OFFICER WHO IS VESTED WIT H THE RELEVANT JURISDICTION BY VIRTUE OF DIRECTIONS OR OR DERS ISSUED UNDER SECTION 120(1) OR 120(2) OR ANY OTHER PROVISI ON OF THIS ACT. THE SECOND PART PROVIDES THAT ASSESSING O FFICER MEANS THE ADDITIONAL COMMISSIONER OR ADDITIONAL DIRECTOR OR JOINT COMMISSIONER OR JOINT DIRECTO R WHO IS DIRECTED UNDER SECTION 120(4)(B) OF THE ACT TO EXER CISE OR PERFORM ALL OR ANY OF THE POWERS AND FUNCTIONS CONF ERRED ON OR ASSIGNED TO AN ASSESSING OFFICER UNDER THIS A CT. IN OTHER WORDS IT IS MANIFEST THAT ASSESSING OFFICER INTER-ALIA MEANS ADDITIONAL COMMISSIONER WHO IS DIRECTED UNDER SECTION 120(4)(B) OF THE ACT TO EXERCISE OR PERFORM ALL OR ANY OF THE POWERS AND FUNCTIONS CONFERRED ON OR ASSIGNE D TO AN ASSESSING OFFICER UNDER THE ACT . IN OTHER WORDS AN ADDITIONAL COMMISSIONER CAN ONLY BE DIRECTED U/S 120(4)(B) OF THE ACT TO ASSISTANT COMMISSIONER OR DEPUTY COMMISSIONER OR ASSISTANT DIRECTOR OR D EPUTY DIRECTOR OR INCOME TAX OFFICER UNDER THE ACT. THI S INTERPRETATION ALSO DERIVES STRENGTH FROM THE PROVI SIONS CONTAINED IN SECTION 120(4)(B) OF THE ACT WHICH REA DS AS UNDER: 120. JURISDICTION OF INCOME-TAX AUTHORITIES (4) WI THOUT PREJUDICE TO THE PROVISIONS OF SUB-SECTIONS (1) AND (2) THE BOARD MAY BY GENERAL OR SPECIAL ORDER AND SUBJECT TO SUCH CONDITIONS RESTRICTIONS OR LIMITATIONS AS MAY BE SPECIFIED THEREIN - (B) EMPOWER THE DIRECTOR GENERAL OR CHIEF COMMISSIO NER OR COMMISSIONER TO ISSUE ORDERS IN WRITING THAT THE PO WERS AND FUNCTIONS CONFERRED ON OR AS THE CASE MAY BE ASSIGNED TO THE ASSESSING OFFICER BY OR UNDER THIS ACT IN RESPECT OF ANY SPECIFIED AREA OR PERSONS OR CLASSES OF PERSONS OR INCOMES OR CLASSES OF INCOME OR CASES OR CLASSES OF CASES SHALL BE EXERCISED OR PERFORMED B Y AN TATA SONS LTD. 31 ADDITIONAL COMMISSIONER OR AN ADDITIONAL DIRECTOR O R A JOINT COMMISSIONER OR A JOINT DIRECTOR AND WHERE ANY ORDER IS MADE UNDER THIS CLAUSE REFERENCES IN ANY OTHER PROVISION OF THIS ACT OR IN ANY RULE MADE THERE UN DER TO THE ASSESSING OFFICER SHALL BE DEEMED TO BE REFERENCES TO SUCH ADDITIONAL COMMISSIONER OR ADDITIONAL DIRECTOR OR J OINT COMMISSIONER OR A JOINT DIRECTOR BY WHOM THE POWE RS AND FUNCTIONS ARE TO BE EXERCISED OR PERFORMED UNDE R SUCH ORDER AND ANY PROVISION OF THIS ACT REQUIRING APPR OVAL OR SANCTION OF THE JOINT COMMISSIONER SHALL NOT APPLY. 5.3 IT WILL BE SEEN THAT THE SAID PROVISION PROVIDE S THAT BOARD MAY BY GENERAL OR SPECIAL ORDER AND SUBJECT T O SUCH CONDITIONS RESTRICTIONS OR LIMITATIONS AS MAY BE S PECIFIED THEREIN EMPOWER THE DIRECTOR GENERAL OR CHIEF COMMISSIONER OR COMMISSIONER TO ISSUE ORDERS IN WRI TING THAT THE POWERS AND FUNCTIONS CONFERRED ON OR AS TH E CASE MAY BE ASSIGNED TO ASSESSING OFFICER BY OR UNDER THIS ACT IN RESPECT OF ANY SPECIFIED AREA OR PERSONS OR CLASSES OF PERSONS OR INCOMES OR CLASSES OF INCOME OR CASES OR CLASSES OF CASES SHALL BE EXERCISED OR PERFORMED BY AN ADDITIONAL COMMISSIONER OR AN ADDITIONAL DIRECTOR O R A JOINT COMMISSIONER OR A JOINT DIRECTOR AND WHERE AN Y ORDER IS MADE UNDER THIS CLAUSE REFERENCE IN ANY O THER PROVISION OF THIS ACT OR IN ANY RULE MADE THERE UND ER TO THE ASSESSING OFFICER SHALL BE DEEMED TO BE REFERENCES TO SUCH ADDITIONAL COMMISSIONER OR ADDITIONAL DIRECTOR OR J OINT COMMISSIONER OR A JOINT DIRECTOR BY WHOM THE POWER S AND FUNCTIONS ARE TO BE EXERCISED OR PERFORMED UNDE R SUCH ORDER AND ANY PROVISION OF THIS ACT REQUIRING APPRO VAL OR SANCTION OF THE JOINT COMMISSIONER SHALL NOT APPLY. 5.4 THE POSITION WHICH EMERGES THUS IS THAT AN ADDI TIONAL COMMISSIONER OF INCOME TAX IPSO FACTO CANNOT EXERCI SE THE POWERS OR PERFORM THE FUNCTIONS OF AN ASSESSING OFF ICER UNDER THE ACT . HE CAN PERFORM THE FUNCTIONS AND EXERCISE THE POWERS OF AN ASSESSING OFFICER ONLY IF HE IS SP ECIFICALLY DIRECTED UNDER SECTION 120(4)(B) OF THE ACT. 3.33. SIMILAR ISSUE HAS BEEN DECIDED BY THE LUCKNOW BENCH OF ITAT IN THE CASE OF PRACHI LEATHER PVT. LTD VS. ADDITIONAL CIT IN ITA NO. 26(L)/2010 DATED 8.12.2010 RELYING UPON ITS EARLIER ORDER IN ITA NO.744/2004/LUCKNOW FOR ASSESS MENT TATA SONS LTD. 32 YEAR 2001-02 DECIDED THIS ISSUE ON THE SIMILAR LINE S AFTER CONSIDERING AND FOLLOWING THE DECISION OF HONBLE D ELHI HIGH COURT IN THE CASE OF NALINI MAHAJAN VS. DIT 257 ITR 123 (DELHI) . IT IS ALSO NOTED THAT THIS DECISION HAS ALSO BEE N CONSIDERED BY DELHI BENCH IN THE CASE OF MEGA CORPO RATIONS LTD SUPRA AND RELEVANT PORTION OF THE ORDER AS DIS CUSSED THEREIN IS REPRODUCED BELOW:- 16.2 FROM THE CONTENTS OF THE AFORESAID PROVISIONS IT IS QUITE CLEAR THAT SO FAR AS ADDL. COMMISSIONER IS CO NCERNED FIRSTLY HE HAS BEEN INCLUDED IN THE DEFINITION OF ASSESSING OFFICER GIVEN UNDER SECTION 2(7A) OF THE ACT WITH EFFECT FROM 1.6.1994 AS A RESULT OF RETROSPECTIVE AMENDMEN T MADE BY THE FINANCE ACT 2007 BUT AT THE SAME TIME IT IS ALSO CLEAR THAT THE ADDL. COMMISSIONER WILL BE ASSE SSING OFFICER AS ENVISAGED IN SECTION 2(7A) SO AMENDED ON LY IF HE IS DIRECTED UNDER CLAUSE (B)OF SUB-SECTION (4) OF S ECTION 120 TO EXERCISE OR PERFORM ALL OR ANY OF THE POWERS AND FUNCTIONS CONCERNED ON OR ASSIGNED TO AN ASSESSING OFFICER; MEANING THEREBY THAT THE ADDL. CIT CAN FUN CTION OR CAN EXERCISE THE POWERS AND PERFORM THE FUNCTIONS O F AN ASSESSING OFFICER IF HE IS EMPOWERED BY THE CBDT AS REQUIRED UNDER CLAUSE (B) OF SUB-SECTION (4) OF SEC TION 120. 18.1 SO FAR AS THE ISSUE BEFORE US IN THE PRESENT A PPEAL IS CONCERNED IT IS NOW CLEAR FROM THE PROVISIONS AS D ISCUSSED HEREINBEFORE THAT THE ADDITIONAL CIT COULD ACT AND EXERCISE THE POWERS OF AN AO ONLY IN CONSEQUENCE UPON DELEGA TION OF SUCH AUTHORITY BY THE BOARD CHIEF COMMISSIONER OF INCOME-TAX OR COMMISSIONER OF INCOME-TAX AS ENVISAG ED IN THE PROVISIONS OF SECTION 120(4)(B) OF THE ACT. HOW EVER THE POWER GIVEN TO THE CHIEF COMMISSIONER OF INCOME-TAX OR COMMISSIONER OF INCOME-TAX BEING IN CONSEQUENCE UPO N THE DELEGATION OF POWER DULY AUTHORIZED BY THE LEGI SLATURE THE CHIEF COMMISSIONER OF INCOME-TAX OR COMMISSIONE R OF INCOME-TAX WERE DUTY BOUND IF AT ALL THEY WERE TO EXERCISE SUCH DELEGATED POWER TO ACT ACCORDING TO THE PROVIS IONS OF LAW; MEANING THEREBY THAT IT WAS INCUMBENT UPON THE CHIEF COMMISSIONER OF INCOME-TAX OR THE COMMISSIONE R OF INCOME-TAX AS THE CASE MAYBE IF AT ALL THEY WANTE D TO TATA SONS LTD. 33 AUTHORIZE THE ADDITIONAL CIT TO ACT AND PERFORM THE FUNCTIONS OF AN AO TO PASS A PROPER ORDER DELEGATI NG SUCH FUNCTIONS/ POWERS UPON HIM. THIS VIEW OF OURS IS FU LLY SUPPORTED BY THE DECISION OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF DR. NALINI MAHAJAN VS. DIT 257 ITR 123 WHEREIN THE HON'BLE HIGH COURT WHILE DISCUSSING TH E POWERS OF ADDITIONAL DIRECTOR INVESTIGATION HELD A S UNDER: 'IT IS NOW WELL-SETTLED THAT WHEN A POWER IS GIVEN TO DO A CERTAIN THING IN A CERTAIN MANNER THE SAME MUST BE DONE IN THAT MANNER OR NOT AT ALL. A DELEGATION OF POWER IS ESSENTIALLY A LEGISLATIVE FUNCTION. SUCH A POWER OF DELEGATION MUST BE PROVIDED BY THE STATUTE. THE DIR ECTOR HIMSELF FOR CERTAIN MATTERS IS THE DELEGATING AUTHO RITY. HE UNLESS THE STATUTE EXPRESSLY STATES CANNOT SUB-DEL EGATE HIS POWER TO ANY OTHER AUTHORITY. IN ANY EVENT IF AN AUTHORITY WHICH HAD NO JURISDICTION TO ISSUE SUCH AN AUTHORIZATION DID SO THE SAME WOULD BE LIABLE TO BE QUASHED AS ULTRA VIRES. THUS UNLESS AND UNTIL AN AMENDMENT IS CARRIED OUT BY REASON OF THE REDESIGN ATION ITSELF READ WITH THE PROVISIONS OF THE GENERAL CLA USES ACT THE ADDL. DIRECTOR DOES NOT GET ANY STATUTORY POWER TO ISSUE AUTHORIZATION TO ISSUE WARRANT. THEREFORE TH E ADDL. DIRECTOR (INVESTIGATION) CANNOT BE SAID TO HAVE ANY POWER TO ISSUE ANY AUTHORIZATION OR WARRANT TO JOINT DIRE CTOR. CONSEQUENTLY NOTIFICATION DT. 6TH SEP. 1989 IS NOT VALID IN LAW TO THE SAID EXTENT. ' 18.2 SO FAR AS THE PRESENT CASE IS CONCERNED THOUG H WE ARE CONCERNED WITH THE POWERS OF ADDITIONAL CIT BUT THE PROPOSITION OF LAW LAID DOWN BY THE HON'BLE HIGH CO URT WHICH WAS THOUGH IN RELATION TO POWERS OF ADDITION AL DIRECTOR (INVESTIGATION) IS FULLY APPLICABLE TO TH E PRESENT CASE. 18.3 IN VIEW OF THE AFORESAID FACTS CIRCUMSTANCES AND THE DISCUSSION AND FOLLOWING THE LAW LAID DOWN BY THE H ON'BLE DELHI HIGH COURT IN THE CASE OF DR. NALINI MAHAJAN (SUPRA) FIRST OF ALL WE ARE OF THE OPINION THAT THE ADDL.CI T RANGE-6 KANPUR HAVING NOT BEEN EMPOWERED TO EXERCISE OR PER FORM THE POWERS OR FUNCTIONS OF AN ASSESSING OFFICER TH E ASSESSMENT FRAMED BY HIM WAS ILLEGAL AND VOID AB INITIO. TATA SONS LTD. 34 3.34. IT IS FURTHER NOTED THAT SIMILAR VIEW HAS BEEN EXPR ESSED BY JODHPUR BENCH OF ITA IN THE CASE CITY GARDEN VS. ITO 21 TAXMAN.COM 373 (JODHPUR) WHEREIN IT HAS BEEN HELD THAT IN THE ABSENCE OF A SPECIFIC ORDER ISSUED IN PURSUANCE TO SECTION 120(4)(B) SPECIFICALLY AUTHORIZING JOINT COMMISSIONE R OF INCOME TAX TO EXERCISE THE POWERS AND PERFORM THE F UNCTION AS CONFERRED ON OR ASSIGNED TO AN ASSESSING OFFICER BY OR UNDER THE ACT OR A NOTIFICATION UNDER SECTION 120 OF THE ACT HE IS NOT COMPETENT TO ACT AS AN ASSESSING OFFICER AND PASS A N ASSESSMENT ORDER. 3.35. SIMILAR VIEW HAS BEEN TAKEN BY LUCKNOW BENCH OF ITA T IN THE CASE OF MICROFIN SECURITY PVT. LTD VS. ADDITIONAL CIT 94 TTJ 767 WHEREIN IT WAS HELD THAT IN ABSENCE OF ANY ALLOCATION BEING MADE IN FAVOUR OF ADDITIONAL COMMI SSIONER TO MAKE AN ASSESSMENT HE CANNOT ASSUME FOR HIMSELF SU CH AN AUTHORITY SO AS TO PASS AN ASSESSMENT ORDER. 3.36. SIMILAR VIEW HAS BEEN TAKEN RECENTLY IN ANOTHER JUDGMENT BY THE DELHI BENCH OF THE ITAT IN THE CASE OF HARVINDER SINGH JAGGI VS. ACIT 157 ITD 869 (DELHI) . RELEVANT PART OF OBSERVATIONS OF THE BENCH IS REPRO DUCED BELOW:- .AS REGARD THE CONTENTION OF THE ASSESSEE THAT N O ORDER UNDER SECTION 127 WAS PASSED BY THE COMMISSIO NER OF INCOME-TAX THE REVENUE HAS SUBMITTED THAT THE A DDL. COMMISSIONER OF INCOME TAX WAS PROVIDED CONCURRENT JURISDICTION OVER THE CASES THROUGH THE ORDER OF TH E COMMISSIONER OF INCOME TAX AND THEREFORE NO SEPAR ATE ORDER UNDER SECTION 127 WAS REQUIRED TO BE PASSED B Y THE COMMISSIONER OF INCOME TAX. HOWEVER NO SUCH ORDER OF THE COMMISSIONER OF INCOME TAX CONFERRING THE CONCU RRENT JURISDICTION TO THE ADDL. COMMISSIONER OF INCOME TA X OVER THE CASES OF THE INCOME TAX OFFICER IS EITHER AVAIL ABLE ON TATA SONS LTD. 35 ASSESSMENT RECORD OR WAS PRODUCED BY THE REVENUE. THUS IN ABSENCE OF ANY SUCH ORDER IT CANT BE EST ABLISHED THAT SAID ASSESSMENT ORDER PASSED WAS WITHIN THE JURISDICTION OF THE ADDL. COMMISSIONER OF INCOME TA X. THUS THE ASSESSMENT COMPLETED BY ADDITIONAL COMMISSIONER OF INCOME TAX IN THE CASE BEING WITHOU T JURISDICTION IS VOID AB INITIO. ACCORDINGLY THE G ROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 3.37. IN THE CASE OF BINDAL APPARELS LTD VS. ACIT DELHI BENCH OF ITAT TOOK A SIMILAR VIEW AND HELD THAT IN VIEW OF DEFINITION OF ASSESSING OFFICER CONTAINED U/S 2(7A) AN ADDITIONAL COMMISSIONER CANNOT BE AN AUTHORITY TO E XERCISE AND PERFORM ALL OR ANY OF THE POWERS OF THE FUNCTIO NS OF THE ASSESSING OFFICER TO MAKE ASSESSMENT OF INCOME. TH E BENCH ANALYSED THE PROVISIONS OF SECTION 2(7A) AS IT EXIS TED PRIOR TO AMENDMENT MADE BY FINANCE ACT 2007. 3.38. DURING THE COURSE OF HEARING IT WAS ALSO SUBMITTED BY LD. CIT-DR TO DEFEND THE IMPUGNED ASSESSMENT ORDER THAT IN ANY CASE THE ASSESSMENT ORDER HAS BEEN PASSED BY AN OFFICER OF THE RANK OF ADDITIONAL COMMISSIONER WHICH IS MUC H SUPERIOR TO THE RANK OF ASSISTANT COMMISSIONER AND THUS NO PREJUDICE CAN BE PRESUMED TO HAVE BEEN DONE TO THE ASSESSEE. WE FIND THAT REASONING GIVEN BY THE LD. CIT-DR TO D EFEND THE IMPUGNED ASSESSMENT ORDER DOES NOT HAVE ANY LEGAL F ORCE. IT IS WELL SETTLED LAW THAT JURISDICTIONAL CONDITIONS REQUIRED TO BE FULFILLED BY THE ASSESSING OFFICER MUST BE PERFORME D STRICTLY IN THE MANNER AS HAVE BEEN PRESCRIBED AND IF IT HAS NO T BEEN DONE IN THE MANNER AS PRESCRIBED UNDER THE LAW THE N IT BECOMES NULLITY IN THE EYES OF LAW. HONBLE SUPREME COURT IN THE CASE OF CIT VS. ANJUM M. H. GHASWALA OBSERVED THAT IT IS A NORMAL RULE OF CONSTRUCTION THAT WHEN A STA TUE VESTS TATA SONS LTD. 36 CERTAIN POWERS IN AN AUTHORITY TO BE EXERCISED IN A PARTICULAR MANNER THEN THAT AUTHORITY IS BOUND TO EXERCISE IT ONLY IN THE MANNER PROVIDED IN THE STATUE ONLY. 3.39. HONBLE BOMBAY HIGH COURT DEALT WITH A SIMILAR SITUATION IN THE CASE OF GHANSHAM K.KHABRANI VS. ACIT 346 ITR 443 WHEREIN THE SAID ASSESSEE RAISED AN ISSUE THAT REQUISITE SANCTION PRESCRIBED U/S 151 FOR REOPENING OF AN ASSESSMENT WAS REQUIRED TO BE OBTAINED BY THE AO FR OM JOINT COMMISSIONER OF INCOME TAX WHEREAS THE SAME WAS GRA NTED BY COMMISSIONER OF INCOME TAX AND THEREFORE THE SAME W AS NULLITY IN THE EYES OF LAW. REVENUE TOOK A STAND T HAT SANCTION WAS GRANTED BY AN OFFICER SUPERIOR IN RANK AND THER EFORE NO PREJUDICE WAS CAUSED TO THE ASSESSEE. BUT HONBLE HIGH COURT DID NOT AGREE WITH THE CONTENTION OF THE REVENUE AN D OBSERVED THAT:- ..THE EXPRESSION JOINT COMMISSIONER IS DEFINED IN SECTION 2(28C) TO MEAN A PERSON APPOINTED TO BE A J OINT COMMISSIONER OF INCOME TAX OR AN ADDITIONAL COMMISSIONER OF INCOME-TAX UNDER SECTION 117(1). SE CTION 151(2) MANDATES THAT THE SATISFACTION HAS TO BE OF THE JOINT COMMISSIONER. THE EXPRESSION HAS A DISTINCT MEANING BY VIRTUE OF THE DEFINITION IN SECTION 2(28 C). THE COMMISSIONER OF INCOME TAX IS NOT A JOINT COMMISSIO NER WITHIN THE MEANING OF SECTION 2(28C). THERE IS NO S TATUTORY PROVISION UNDER WHICH POWER TO BE EXERCISED BY AN O FFICER CAN BE EXERCISED BY A SUPERIOR OFFICER. WHEN THE ST ATUTE MANDATES THE SATISFACTION OF A PARTICULAR FUNCTIONA RY FOR THE EXERCISE OF A POWER THE SATISFACTION MUST BE O F THAT AUTHORITY. WHERE A STATUTE REQUIRES SOMETHING TO BE DONE IN A PARTICULAR MANNER IT HAS TO BE DONE IN THAT M ANNER ONLY 3.40. THUS IN VIEW OF THE LEGAL DISCUSSION MADE ABOVE AN D FACTS OF THE CASE IT IS CLEAR THAT IMPUGNED ASSESS MENT ORDER HAS BEEN PASSED WITHOUT AUTHORITY OF LAW IN AS MUCH AS TATA SONS LTD. 37 REVENUE HAS NOT BEEN ABLE TO DEMONSTRATE THAT THE A DDITIONAL COMMISSIONER OF INCOME TAX WHO HAD PASSED THE ASSES SMENT ORDER HAD VALID AUTHORITY TO PERFORM AND EXERCISE T HE POWERS AND FUNCTIONS OF AN ASSESSING OFFICER OF THE ASSESS EE AND TO PASS THE IMPUGNED ASSESSMENT ORDER. UNDER THESE CIRCUMSTANCES WE HAVE NO OTHER OPTION BUT TO HOLD THE SAME AS NULLITY AND THEREFORE THE IMPUGNED ASSESSMENT ORDER IS QUASHED HAVING BEEN PASSED WITHOUT AUTHORITY OF LAW . 3.41. SINCE WE HAVE QUASHED THE ASSESSMENT ORDER ON JURISDICTIONAL GROUND WE DO NOT DEEM IT NECESSARY TO ADJUDICATE GROUNDS ON MERIT RAISED BY THE ASSESSEE IN ITS APPEAL. AS A RESULT THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 3.42. WITH REGARD TO REVENUES APPEAL SINCE ASSESSMENT ORDER HAS BEEN QUASHED THEREFORE APPEAL FILED BY THE RE VENUE BECOMES INFRUCTUOUS AT THIS STAGE. THUS THE SAME I S DISMISSED AS INFRUCTUOUS. 4. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PARTL Y ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST OCTOBER 2016. SD/- (SANJAY GARG) SD/- (ASHWANI TANEJA) ! / JUDICIAL MEMBER ' ! / ACCOUNTANT MEMBER ! ' MUMBAI; ' DATED : 31 / 10 /2016 CTX? P.S/. .. TATA SONS LTD. 38 #$%&'(')% / COPY OF THE ORDER FORWARDED TO : 1. ) *+ / THE APPELLANT 2. -*+ / THE RESPONDENT. 3. .$ . ! / ( ) ) / THE CIT MUMBAI. 4. .$ . ! / / CIT(A)- MUMBAI 5. 23 45 .$ )% 45$6 ! ' / DR ITAT MUMBAI 6. 7 8 ' / GUARD FILE. / BY ORDER - 2) //TRUE COPY// / (DY./ASSTT. REGISTRAR) ! ' / ITAT MUMBAI