Nehru Bal Niketan Prabandh Samiti vs Income Tax Officer

PER MADHUMITA ROY, JM:

The instant appeal filed by the Assessee is directed against the order dated 12.06.2025 passed by the Ld. Addl./JCIT(A), Bhubaneswar, (hereinafter referred to as ‘Ld. CIT(A)’) arising out of the Assessment Order dated 17.12.2018, passed by the Exemption Ward, Ghaziabad, (hereinafter referred to as the "AO") under Section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for the Assessment Year 2016-17.

The assessee has filed an application for admission of additional ground of appeal, inter alia on the jurisdictional issue challenging the very basis of the assessment proceeding itself by issuance of notice under Section 143(2) of the Act dated 21.08.2017 by and under the signature of ACIT(E), Circle, Ghaziabad. Since, this very ground relates to the jurisdiction of the Ld. AO itself which goes to the root of the matter, we have decided to address the same at the very threshold as submitted by the Ld. Senior Counsel, Shri Ved Jain.

It is the case of the assessee that since the assessee has filed return declaring total income at ‘NIL’, which is below Rs.15 lakhs as per CBDT Instruction No. 01/2011 dated 31.01.2011 read with Instruction No.06/2011, dated 08.04.2011, the notice under Section 143(2) of the Act ought to have been issued by the ITO whereas in the instant case the same was issued under the signature of the ACIT, Exemption, Circle Ghaziabad. In that view of the matter, the entire proceeding since having been completed on the basis of a invalid notice, the proceeding itself vitiated, void-ab-initio and therefore, liable to be quashed as also reiterated by the Ld. AR.

In this connection, he has drawn our attention to pages 10-13 of Paper book, wherein the notice in question under Section 143(2) of the Act dated 28.01.2017 issued by the ACIT (E), Circle Ghaziabad, is annexed. Furthermore, he has also relied upon the judgment passed by the Hon’ble Calcutta High Court in the case of PCIT vs Raghvendra Mohta, reported in (2025 (5) TMI 529) and Hon’ble Bombay High Court in the case of Ashok Devichand vs Union of India and Ors., reported in 2022 (3) TMI 1466, wherein it has been held that an assessment framed on the basis of notice issued by an officer lacking jurisdiction particularly in violation of CBDT Instruction no.01/2011 is non-est in the eyes of law and liable to be quashed.

The contention made by the Ld. AR has not been able to be controverted by the Ld. DR

Having heard the Ld. Counsels appearing for the parties and having regard to the facts and circumstances of the matter particularly the basis of reassessment proceeding being notice under Section 143(2) of the Act having been issued by a non-jurisdictional officer in violation of CBDT Circular itself and further the ratio laid down by the Hon’ble High Courts as mentioned hereinabove, we are inclined to accept the contentions made by the Ld. AR. The impugned notice under Section 143(2) dated 28.01.2017 is found to have been issued by ACIT having no jurisdiction considering the ROI filed by the assessee at Rs.15 lakhs, i.e., below Rs.20 lakhs, thus, not sustainable in the eyes law. The entire proceeding is, therefore, vitiated, having no legs to stand on and therefore quashed.

As the assessee has succeeded on its legal grounds qua jurisdictional sufficiency, the other grounds of appeal raised by the assessee on the merits of the addition, have become academic and, therefore, no order needs to be passed.

In the result, the appeal of the assessee is allowed.