Income Tax Appellate Tribunal - Raipur
Jindal Power Limited, Raigarh vs Joint Commissioner Of Income Tax, ... on 25 June, 2024
आयकर अपील य अ धकरण यायपीठ रायपुर म।
IN THE INCOME TAX APPELLATE TRIBUNAL,
RAIPUR BENCH, RAIPUR
BEFORE SHRI RAVISH SOOD, JUDICIAL MEMBER
AND
SHRI ARUN KHODPIA, ACCOUNTANT MEMBER
आयकर अपील सं. / ITA Nos. 201 & 202/RPR/2017
नधारण वष / Assessment Years : 2010-11 & 2011-12
Jindal Power Limited
Kharsia Road,
Raigarh (C.G.)
PAN: AABCJ4683J
.......अपीलाथ / Appellant
बनाम / V/s.
The Jt. Commissioner of Income Tax,
Range-1, Bilaspur (C.G).
...... यथ / Respondent
Assessee by : S/shri Salil Kapoor &
Vibhu Jain, Advocates
Revenue by : S/shri V.K Singh, CIT-DR &
Rahul Mishra, Dy. CIT
S.L. Anuragi, CIT-DR
सुनवाई क तार ख / Date of Hearing : 15.04.2024
घोषणा क तार ख / Date of Pronouncement : 25.06.2024
2
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur
ITA Nos.201 & 202/RPR/2017
आदे श / ORDER
PER RAVISH SOOD, JM:
The captioned appeals filed by the assessee company are directed against the respective orders passed by the Commissioner of Income-Tax (Appeals), Bilaspur, dated 01.03.2017 which in turn arises from the respective orders passed by the A.O under Sec.143(3) of the Income-tax Act, 1961 (in short 'the Act') dated 01.03.2013 & 29.01.2014 for the assessment years 2010-11 & 2011-12. As the issues involved in the captioned appeals are inextricably interlinked or in fact interwoven, therefore, the same are being taken up and disposed off by way of a consolidated order.
2. We shall first take up the appeal filed by the assessee company in ITA No.201/RPR/2017 for assessment year 2010-11, wherein the impugned order has been assailed on the following grounds of appeal:
"1. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making addition of Rs 14,01,06,197/- to total income as per the provision of clause (ii) & (iii) of Rule 8D of IT Rules and made addition u/s 14A of the Act and also adding the same to book profit for calculating MAT u/s 115JB of Income Tax Act, 1961 and the same is confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
2. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making addition of Rs. 1,81,68,52,360/- to total income notionally on account of lower rate of power tariff on sales to holding company and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
3. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of the expenditure of Rs 2,24,58,798/- incurred under Rehab Compensation Scheme and 3 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
4. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of expenditure of Rs.5,39,76,720/- incurred on account of Community Welfare and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
5. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of Rs.1,09,52,951/- on account of additional depreciation and the same is confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
6. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law by treating income of Rs. 123,42,91,452/- as Income from other sources there by disallowing the deduction u/s 80IA of Income Tax Act, 1961 and disallowing personal administrating expenses by Rs. 43,04,142/- and Rs 10,64,876/- u/s 43B of Income Tax Act, 1961 and confirmed by Ld. CIT (A), the same is against the facts & also against the law, hence may kindly be deleted.
7. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law by adding disallowance of Rs 14,01,06,197/- made u/s. 14A to re-compute book Profit u/s 115JB and the same is confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
8. The appellant reserves its right to add, amend, or alter the grounds of appeals on or before the date: the appeal is finally heard for disposal."
The assessee company vide an application dated 07.03.2022 has raised additional ground of appeal which reads as under:
"1. That, the assessment order passed dated 01.03.2013 for AY 2010-11 by the Joint Commissioner of Income Tax (JCIT) is illegal, bad in law and without jurisdiction as the JCIT was not the competent person to pass the said assessment order.
2. That, the JCIT who passed the assessment order dated 01.03.2013 was not competent to pass the said order and as such the assessment order is liable to be quashed."4
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 As the adjudication of the additional grounds involves purely a question of law which would not require looking any further beyond the facts available on record, therefore, we have no hesitation in admitting the same. Our aforesaid view that where an assessee, had raised, though for the first time, an additional ground of appeal before the Tribunal which involves purely a question of law and requires no further verification of facts, then, the same merits admission finds support from the judgment of the Hon'ble Supreme Court in the case of National Thermal Power Company Ltd. Ltd. Vs. CIT (1998) 229 ITR 383 (SC).
3. Succinctly stated, the assessee company which is engaged in the business of generation and sale of power had filed its original return of income for A.Y.2010- 11 on 10.10.2012 disclosing a "book profit" of Rs.2,809.68 crores. The return of income filed by the assessee company was initially processed u/s.143(1) of the Act. Subsequently, the case of the assessee company was selected for scrutiny assessment u/s.143(2) of the Act.
4. Original assessment was framed by the A.O vide his order passed u/s. 143(3) dated 01.03.2013, wherein the income of the assessee company under normal provisions was determined at Rs.123,42,91,452/- after, inter alia, making following additions/disallowances:
Sr. Particulars Amount
No.
1. Disallowance u/s. 14A of the Act Rs.14,01,06,197/-
5
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur
ITA Nos.201 & 202/RPR/2017
2. Addition on account of lower rate of Rs.181,68,52,360/-
power tariff for the holding company
3. Addition on account of 'Rehab Rs.2,24,58,798/-
Compensation
4. Addition on account of Community Rs.5,39,76,720/-
welfare
5. Disallowance of additional depreciation Rs.1,09,52,951/-
Also, the A.O after making an addition of the amount disallowed by him u/s. 14A of the Act, re-worked out the "book profit" of the assessee company at Rs.2823,43,92,054/-.
5. Aggrieved the assessee company carried the matter in appeal before the CIT(Appeals) who upheld the aforesaid additions/ disallowances made by the A.O.
6. The assessee company being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before us.
7. We have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and material available on record as well as considered the judicial pronouncements that have been pressed into service by them to drive home their respective contentions.
8. As the assessee company has assailed the validity of the jurisdiction assumed by the A.O, i.e. Jt. CIT, Range-1, Bilaspur for framing the assessment vide his order u/s. 143(3) of the Act dated 01.03.2013, therefore, we shall first deal with the same.
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Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017
9. Shri Salil Kapoor, Ld. Authorized Representative (for short 'AR') for the assessee company at the threshold submitted that the Joint Commissioner of Income Tax (for short 'Jt. CIT'), Range-1, Bilaspur though not being a competent person to frame the assessment had, however, wrongly assumed jurisdiction and passed the assessment order u/s. 143(3) of the Act dated 01.03.2013. Elaborating on his contention, the Ld. AR submitted that as the Jt. CIT, Range-1, Bilaspur had framed the assessment vide his order u/s.143(3) of the Act dated 01.03.2013 in absence of an order u/s. 120(4)(b) of the Act conferring power on him to perform the functions of an "Assessing Officer" under the Act, therefore, the assessment so framed by him could not be sustained and is liable to be quashed on the said count itself. The Ld. AR to buttress his contention had drawn our attention to Section 120(4)(b) of the Act, which contemplates that the Central Board of Direct Tax (CBDT) may by general or special order and subject to such conditions, restrictions or limitations as may be specified therein, empower the Director General or Chief Commissioner or Commissioner to issue orders in writing that the powers 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 by an Additional Commissioner or an Additional Director or a Joint Commissioner or a Joint Director, and where any order is made under this clause, references in any other provisions of this Act, or in any rule made thereunder to the Assessing Officer shall be deemed to be references to such Additional 7 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 Commissioner or Additional Director or Joint Commissioner or Joint Director by whom the powers and functions are to be exercised or performed under such order, and any provision of this Act requiring approval or sanction of the Joint Commissioner shall not apply.
10. The Ld. AR submitted that as the Jt. CIT can assume jurisdiction and exercise powers and functions conferred on or as the case may be assigned to an Assessing Officer based on an order passed by a specified authority u/s. 120(4)(b) of the Act, which in turn is based on a general or special order by the CBDT, therefore, in absence of any order u/s. 120(4)(b) of the Act the assessment framed in the present case by the Jt. CIT, Range-1, Bilaspur cannot be sustained and is liable to be struck down for want of valid assumption of jurisdiction on his part. The Ld. AR had thereafter drawn our attention to the definition of term "Assessing Officer" contemplated in Section 2(7A) of the Act. In sum and substance, it was the claim of the Ld. AR that as the Jt. CIT, Range-1, Bilaspur had framed the assessment vide his order u/s. 143(3) of the Act dated 01.03.2013 without there being any order u/s.120(4)(b) of the Act conferring upon him the jurisdiction of the A.O, therefore, the consequential assessment framed by him u/s.143(3) of the Act dated 01.03.2013 being devoid of any force of law is liable to be quashed.
11. As the assessee company has assailed the validity of the jurisdiction assumed by the Jt. CIT, Range-1, Bilaspur for framing the assessment vide his order u/s.143(3) dated 01.03.2013, therefore, the Ld. Departmental Representative (for short 'DR') was directed to obtain a report from the A.O. 8 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017
12. On the next date of hearing, the Ld. DR had placed on record a report dated 12.06.2023 of the DCIT, Bilaspur wherein, the latter has stated that the order u/s. 120(4)(b) of the Act was passed by the Commissioner of Income Tax pursuant to CBDT Notification based on which, the concerned Jt. CIT was vested with the concurrent jurisdiction over the area jurisdiction assigned to such range. It is further stated by him that no order was passed u/s. 127 of the Act. It is further stated in the letter that as a matter of practice the order passed by the Jt. CIT would be entered in the registers of the respective A.Os. For the sake of clarity, the letter dated 12.06.2023 of the DCIT, Bilaspur is culled out as under:
9
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 The Ld. DR had further submitted that as the assessee company had not raised any objection regarding the validity of the jurisdiction assumed by the Jt. CIT, Range-1, Bilaspur for framing the assessment within the prescribed time period contemplated under sub-section (3) to Section 124 of the Act, therefore, he was divested from raising such plea in the course of the present proceedings.
13. The Ld. AR on being confronted with the aforesaid letter dated 12.06.2023 (supra) had rebutted the contents of the same. It was claimed by him that the A.O had wrongly stated in his letter that an order u/s. 120(4)(b) of the Act was passed by the Commissioner of Income Tax pursuant to the Notification issued by the CBDT vesting concurrent jurisdiction with the Jt. CIT, Range-1, Bilaspur over the case of the assessee. Also, the Ld. AR assailed the validity of the jurisdiction assumed by the Jt. CIT, Range-1, Bilaspur in absence of any order u/s. 127 of the Act.
14. As the existence of the order u/s. 120(4)(b) of the Act passed by the Commissioner of Income Tax vesting jurisdiction with the Jt. CIT, Range-1, Bilaspur over the case of the assessee company was called in question, therefore, Shri Rahul Mishra, Dy. CIT, Bilaspur, i.e. A.O who had appeared before us was directed to place on record a copy of the aforesaid order a/w. copy of the notification issued by the CBDT vesting concurrent jurisdiction with the Jt. CIT, Range-1, Bilaspur for framing the assessment in the case of the assessee company.
15. Although, the Dy. CIT, Bilaspur in compliance to the aforesaid direction of the Bench had placed on record a letter dated 08.01.2024 bearing Reference No. 10 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 DCIT/Cir-1(1)/BSP/ITAT/120(4)/2023-24/510, but inadvertently on account of mistake on the part of the registry the copy of the same was not placed on record. Accordingly, the Bench being of the view that the DCIT, Bilaspur had failed to comply with the directions, thus, on 19.03.2024 fixed the matter for necessary clarification.
16. On the next date of hearing, i.e. 15.04.2024, the Ld. CIT-DR at the threshold submitted that as intimated by the DCIT, Circle-1(1), Bilaspur, the directions of the Bench were duly complied and a reply dated 08.01.2024 (through proper channel) was forwarded to the bench (through speed post) on 18.01.2024.
17. Considering the aforesaid facts, the registry after verifying the records had placed before us a letter dated 08.01.2024 (supra) of the DCIT, Circle-1(1), Bilaspur (received vide speed post through proper channel). It was stated by the registry that inadvertently the aforesaid letter dated 08.01.2024 was tagged with another appeal of the assessee company which was posted for hearing on the same date.
18. Be that as it may, we have perused the letter dated 08.01.2024 of the DCIT, Circle-1(1), Bilaspur. The DCIT, Circle-1(1), Bilaspur in his aforesaid letter had stated that in his earlier letter dated 12.06.2023, it was inadvertently stated by him that an order u/s. 120(4)(b) of the Act was passed in place of Section 120 of the Income Tax Act, 1961. Accordingly, it was requested by him that the mention of order u/s. 120(4)(b) of the Act in his letter dated 12.06.2023 may kindly be read as an order u/s. 120 of the Act. Apart from that, the DCIT, Circle-1(1), Bilaspur had 11 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 along with his letter dated 08.01.2024 (supra) annexed a copy of the Notification No.03/2006, dated 13.10.2006 issued by the Commissioner of Income-Tax, Bilaspur. For the sake of clarity, the letter dated 08.01.2024 of the DCIT, Circle-1(1), Bilaspur is culled out as under:
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Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017
19. As stated by the DCIT, Circle-1(1), Bilaspur, no order u/s. 120(4)(b) of the Act vesting jurisdiction with the Jt. CIT, Range-1, Bilaspur to exercise or perform powers and functions of the A.O had been passed. Ostensibly, the Notification No.03/2006 dated 13.10.2006 passed by the Commissioner of Income Tax, Bilaspur dated 13.10.2006 in exercise of the powers conferred by the CBDT u/s. 120 of the Act, i.e. Notification No.223 dated 31.07.2001 in SO No.732(E) and F. No.137/5/2001-ITA(I) is in a different context. As per the Notification No.03/2006, dated 13.10.2006, the Commissioner of Income Tax, Bilaspur in exercise of powers conferred upon him by the CBDT u/s. 120 of the Act, had authorized the Additional Commissioners of Income Tax/Jt. Commissioners of Income Tax to issue orders in writing for the exercise of the powers and performance of the functions by the A.Os who were sub-ordinate to them. Accordingly, it was pursuant to the aforesaid authorization the Addl. Commissioners/Jt. Commissioners had carried out restructuring of the jurisdiction of the authorities sub-ordinate to them, i.e. DCIT/ACIT/ITO in respect of any specified area or persons or classes of persons or incomes or classes of income or cases or classes of cases. Accordingly, the Notification No.03/2006 dated 13.010.2006 issued by the Commissioner of Income Tax, Bilaspur in exercise of powers conferred by the CBDT u/s. 120 of the Act is not an order u/s.120(4)(b) of the Act conferring jurisdiction with the Jt. CIT, Range-1, Bilaspur to exercise or perform the powers and functions as that of the A.O in the case of the present assessee company before us. For the sake of clarity, the Notification No.03/2006, dated 13.10.2006 (supra) is culled out as under: 13
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 14 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 15 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 16 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 17 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 18 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 19 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 20 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 Admittedly, as stated by the Ld. AR, and rightly so, no order u/s. 120(4)(b) of the Act had been passed by the Commissioner of Income Tax, Bilaspur conferring jurisdiction with the Jt. CIT, Range-1, Bilaspur to exercise or perform the powers and functions of the A.O in the case of the present assessee company before us.
20. We shall now deal with the sustainability of the assessment order passed by the Jt. CIT, Range-1, Bilaspur u/s.143(3) dated 29.01.2014 in absence of any order u/s.120(4)(b) of the Act conferring upon him the jurisdiction to exercise or perform the powers and functions as that of an A.O over the case of the assessee company before us.
21. Before proceeding any further, we deem it fit to cull out sub-section (3) to Section 143 of the Act which reads as under:
"143(3) On the day specified in the notice issued under sub-section (2), or as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing Officer may require on specified points, and after taking into account all relevant material which he has gathered, the Assessing Officer shall, by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him or refund of any amount due to him on the basis of such assessment:"
(emphasis supplied by us) Ostensibly, as per sub-section (3) to Section 143 of the Act, the Assessing Officer shall, by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him or refund of any amount due to him on the basis of such assessment. As the assessment can only be framed by the "Assessing Officer", therefore, we shall now look into the definition of the term 21 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 "Assessing Officer" as contemplated in Section 2(7A) of the Act, which reads as under:
"2. In this act, the context otherwise requires:-
xxxxxxxxxx (7A) "Assessing Officer" means the Assistant Commissioner or Deputy Commissioner or Assistant Director 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 of this Act, and the Additional Commissioner or Additional Director or Joint Commissioner or Joint Director who is directed under clause (b) of sub-section (4) of that section to exercise or perform all or any of the powers and functions conferred on, or assigned to, an Assessing Officer under this Act;"
(emphasis supplied by us) On a careful perusal of the aforesaid definition of the term "Assessing Officer" we find that the same, inter alia, takes within its sweep an Additional Commissioner or Additional Director or Joint Commissioner or Joint Director who is directed under Clause (b) of Sub-section (4) of Section 120 of the Act to exercise or perform all or any of the powers and functions conferred on, or assigned to, an Assessing Officer under the Income Tax Act, 1961.
22. As observed by us hereinabove though the Jt. Commissioner of Income Tax, inter alia, can exercise or perform all or any of the powers and functions conferred on, or assigned to the A.O under this Act, but as provided in sub-section (7A) of Section 2 of the Act, the same is subjected to a fundamental pre-condition that he is so directed under clause (b) of sub-section (4) of Section 120 of the Act to exercise or perform all or any of the powers and functions conferred on, or assigned 22 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 to, an Assessing Officer under the Income Tax Act, 1961. Accordingly, the Jt. Commissioner of Income Tax in absence of an order u/s.120(4)(b) of the Act cannot exercise or perform all or any of the powers and functions conferred on or assigned to, an A.O under this Act. A corollary flowing thereto is that the Jt. Commissioner of Income Tax in absence of an order u/s.120(4)(b) of the Act cannot frame the assessment u/s.143(3) of the Act.
23. We find that ITAT, "H" Bench, Mumbai in the case of Shri Kishore Vithaldas Vs, JCIT-17(2), Mumbai, ITA No,7397/Mum/2016 and ITA No.5661/Mum/2017 dated 16.10.2019, had observed, that Jt. CIT/Addl. CIT cannot validly assume jurisdiction and pass an assessment order in absence of an order u/s. 120(4)(b) of the Act. Also, a similar view had been taken by the ITAT, Delhi in the case of Mega Corporation Ltd. vs. ACIT, [2015] 155 ITD 1019. Also, ITAT, Mumbai in the case of Tata Sons Ltd. Vs. ACIT, Circle-2(3), ITA Nos. 4497 & 4542/Mum/2005 had, inter alia, held that Addl. Commissioner of Income Tax can perform functions and exercise powers of an Assessing Officer only if he is specially directed u/s. 120(4)(b) of the Act. For the sake of clarity, the observations of the Tribunal are culled out as under:
"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 defined u/s 2(7A) of the Act. Now, if we refer to section 120, its perusal makes further clear that only CBOT can empower the Chief Commissioners or Commissioners for issuance of orders to the effect that powers and functions of an Assessing Officer 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 23 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 order wherein any specific authority was given by any Chief Commissioner or Commissioner authorizing the impugned Additiona1 l62 Commissioner to pass impugned assessment order. We find force in the argument of Lc). Counsel that at the relevant time when the assessment proceedings were in progress, the word 'Additional Commissioner' was not available m the aforesaid section and therefore, it was not possible for the Chief Commissioner or the Commissioner to have authorized an Additional Commissioner for exercising powers and functions of an Assessing Officer for a particular assessee or classes of assessee. Even otherwise, no order could be shown to us, whereby any such authority was given to the Joint Commissioner of the Range. Under these circumstances, we find that the Revenue is not able to show any order or notification in favour of the Additional Commissioner authorizing him for performing the powers and functions of the Assessing Officer of the assessee.
3.27. During the course of hearing, Ld. CIT-DR had drawn our attention upon Board's Notification No.267/2001 dated 1.7-9-2001, Notification No.228/2001 dated 31.7.2001 and Notification No,335/2001 dated 29-10- 2001 with a view to argue that the jurisdiction was assigned to all the officers including 'Additional Commissioner' for exercise of powers as Assessing Officer, and thus the 'Additional Commissioner of Income Tax' who had passed the impugned assessment order had inherent powers under the law to act as assessing officer of the assessee and pass the impugned assessment order.
3.28. We have gone through all these Notifications, but do not find any substance in the contention of the Ld. C1T-DR. It is noted. that Notification No.335 is issued merely for assigning jurisdiction to various Commissioners and it is thus 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,1961(43 of 1961), the Central Board of Direct Taxes, hereby directs that the Joint Commissioners of Income Tax or the Joint 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 Taxes notification number S.0.732(E) dated 31.07.2001, S.0.880(E) dated 14.09.2001, 8.0.881(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)"24
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017
24. Also, we find that a similar view had been arrived at by the ITAT, Lucknow in the case of Prachi Leather (P). Ltd. Vs. Addl. CIT, ITA No.26/L/2010 dated 08.12.2010, wherein, after drawing support from the judgment of the Hon'ble High Court of Delhi in the case of Dr. Nalini Mahajan Vs. DCIT, (2002) 257 ITR 123 (Del.), it was held as under:
"16.2 From the contents of the aforesaid provisions, it is quite clear that so far as Addl. Commissioner is concerned, 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 amendment made by the Finance Act, 2007 but at the same time, it is also clear that the Addl. Commissioner will be Assessing Officer as envisaged in section 2(7A) so amended only if he is directed under clause (b)of sub-section (4) of section 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 function or can exercise the powers and perform the functions of an Assessing Officer if he is empowered by the CBDT as required under clause (h) of sub-section (4) of section 120. ....
18.1 So far as the issue before us in the present appeal is concerned, it is now clear from the provisions as discussed hereinbefore that the Additional CIT could act and exercise the powers of an AO only in consequence upon delegation of such authority by the Board, Chief Commissioner of Income-tax or Commissioner of Income-tax as envisaged in the provisions of section 120(4)(b) of the Act, However, the power given to the Chief Commissioner of Income-tax or Commissioner of Income-tax being in consequence upon the delegation of power duly authorized by the Legislature, the Chief Commissioner of Income-tax or Commissioner of Income-tax were duly bound, if at all they were to exercise such delegated power to act according to the provisions of law; meaning thereby that it was incumbent upon the Chief Commissioner of Income-tax or the Commissioner of Income-tax, as the case maybe, if at all they wanted to authorize the Additional CIT to act and perform the functions of an AO, to pass a proper order delegating such functions/powers upon him. This view of ours is fully supported by the decision of the Hon'ble Delhi High Court in the case of Dr, Nalini Mahajan v. DIT (2001) 252 ITR 123/[2002) 122 taxman 897 wherein the Hon'ble High Court, while discussing the powers of Additional Director Investigation, held as 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 25 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 delegation must be provided by the statute. The director himself for certain matters is the delegating authority. He, unless the statute expressly states, cannot sub-delegate 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 redesignation itself, read with the provisions of the General Clauses Act, the Addl. Director does not get any statutory power to issue authorization to issue a warrant. Therefore, the Addl. Director (Investigation) cannot be said to have any power to issue any authorization or warrant to Joint Director. 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, though we are concerned with the powers of Additional CIT but the proposition of law laid down by the Hon'ble High Court which was, though in relation to powers' of Additional Director (Investigation), is fully applicable to the present case.
18.3 In view of the aforesaid facts, circumstances and the discussion and following the law laid down by the Hon'ble Delhi High Court in the case of Dr. Nalini Mahajan (supra), first of all we are of the opinion that the Addl. CIT, Range-6, Kanpur having not been empowered to exercise or perform the powers or functions of an Assessing Officer, the assessment framed, by him was illegal and void ab initio. "
25. Further, we find that a similar view had been taken by the ITAT, Jodhpur in the case of City Garden Vs. ITO (2012) 21 taxmann.com 373, and ITAT, Lucknow in the case of Mircrofin Security (P) Ltd. Vs. Addl. CIT (2005) 3 SOT
302. Also, we find that the ITAT, Delhi in the case Shri Nasir Ali Vs. Addl. CIT, ITA No.1285/Del/2018 dated 25.09.2019, had observed that where the Addl. CIT had passed the assessment order, however, no order conferring concurrent jurisdiction to the Addl. CIT over the cases of the Income Tax Officers was available, the assessment so framed being without jurisdiction was void-ab-initio. Also, a similar view had been taken by the ITAT, Delhi in the case of Harvinder Singh Jaggi Vs. ACIT (2016) 157 ITD 869. We may herein observe that the ITAT, 'K' Bench, Mumbai in the case of The Indian Hotels Company Ltd. Vs. Addl. 26
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 CIT/Dy.CIT (OSD), Range-2(2), ITA No. 8570/Mum/2011, ITA No.565/Mum/2013, ITA No.2049/Mum/2014 and ITA No.1910/Mum/2014, dated 21.05.2021, had observed, that as the Addl. CIT, Range-2(2), Mumbai had failed to establish that he possessed the legal and valid powers of performing the functions of an A.O conferred on him u/s. 120(4)(b) of the Act, therefore, assessment so framed by him being devoid and bereft of any force of law was liable to be quashed. Once again, the aforesaid view had been reiterated by the ITAT, "J" Bench, Mumbai in the case of Addl. CIT, Range-1(3) Vs. M/s. Tata Communications Limited (Formerly known as Videsh Sanchar Nigam Limited), ITA No.4452/Mum/2011, ITA No.3460/Mum/2011 and ITA No.8768/Mum/2010 dated 24.12.2019.
26. Further, we find that ITAT, "B" Bench, Kolkata had an occasion to deal with the aforesaid issue in the case of DCIT, Circle-7(1), Kolkata Vs. M/s. Ganesh Realty & Mall Development Pvt. Ltd., ITA No.581/Kol/2017 dated 23.01.2019. The Tribunal had approved the order of the CIT(Appeals), who had observed that as per Section 2(7A) of the Act, ACIT/DCIT, ADIT/DDIT or the ITO would be considered as A.O who had been vested with jurisdiction u/s.120(1) or u/s. 120(2), but the Addl. CIT/Jt. CIT, Addl. DIT/Jt. DIT would act as A.O only if they are empowered u/s. 120(4)(b) of the Act in writing. In fact, we find that a similar view had been taken by the ITAT, Delhi in the case of a group entity of the assessee company, viz. Jindal Steel & Power Ltd. Vs. JCIT, Hisar, ITA No.619/Del/2015 dated 17.09.2021. The Tribunal after carrying out a conjoint reading of Section 2(7A) r.w.s. 120(4)(b) of the Act, had observed that as no order was passed by the 27 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 Commissioner of Income Tax u/s. 120(4)(b) of the Act, therefore, the Jt. CIT, Hisar lacked jurisdiction to frame assessment in the case of the assessee company before them. Accordingly, the Tribunal had concluded that as the Jt. CIT, Hisar- Range, had not legally and validly assumed jurisdiction over the case of the assessee company, therefore, the impugned assessment order passed by him being illegal and without jurisdiction was liable to be quashed. For the sake of clarity, the observations of the Tribunal in the aforesaid case are culled out as under:
"36. In the instant case, (1) there is no order by the Id. CIT invoking powers conferred u/s 120(4) wherein sub-Section (b) empowers the CIT to issue orders in writing that the powers and functions conferred on or as the case may be assigned to the Assessing Officer by or under the Act in respect of any specified areas or persons shall be exercised by the Joint Commissioner. In the absence of any order by. the Id. CIT invoking the powers conferred by sub-Section (4) of Section 120, we hold that the order passed by the Assessing Officer lacks jurisdiction. (2) Further, we also find that the order of the Id. CIT in pursuance with the notification No.251/2001 also did not confer any jurisdiction to the CIT, Hisar. (3) In addition, no order has been issued by the Ld.CIT transferring the case from one AO to other AO u/s 127 is also wanting in the instant case.
37. Considering the totality of the facts and circumstances of the case, we are of the view that JCIT, Hisar Range, do not have jurisdiction over the case of assessee and since he did not assume the jurisdiction legally and validly, therefore, the Impugned assessment order framed by him is vitiated and illegal and without jurisdiction. In view of the above discussion, we set aside the order of the authorities below and quash the impugned order."
27. We shall now deal with the contention of the Ld. DR that as the assessee company had not called in question the jurisdiction of the Jt. CIT, Range-1, Bilaspur within the specified time period contemplated under sub section (3) of Section 124 of the Act, i.e. within a period of one month from the date on which it 28 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 was served with the notice u/s. 143(2) of the Act, therefore, it was divested of its right from assailing the same for the first time before the Tribunal.
28. Before proceeding any further, it would be relevant to cull out Section 124(3) of the Act which reads as under:
"124 (1) xxxxxxxx (2) xxxxxxx (3) No person shall be entitled to call in question the jurisdiction of an Assessing Officer--
(a) where he has made a return under sub-section (1) of section 115WD or under sub-
section (1) of section 139, after the expiry of one month from the date on which he was served with a notice under sub-section (1) of section 142 or sub-section (2) of section 115WE or sub-section (2) of section 143 or after the completion of the assessment, whichever is earlier;
(b) where he has made no such return, after the expiry of the time allowed by the notice under sub-section (2) of section 115WD or sub-section (1) of section 142 or under sub-section (1) of section 115WH or under section 148 for the making of the return or by the notice under the first proviso to section 115WF or under the first proviso to section 144 to show cause why the assessment should not be completed to the best of the judgment of the Assessing Officer, whichever is earlier;
(c) where an action has been taken under section 132 or section 132A, after the expiry of one month from the date on which he was served with a notice under sub-section (1) of section 153A or sub-section (2) of section 153C or after the completion of the assessment, whichever is earlier.
29. Having given a thoughtful consideration to the aforesaid claim of the ld. DR we are unable to persuade ourselves to subscribe to the same. On a careful perusal of Section 124 of the Act, it transpires that the same deals with the issue of "territorial jurisdiction" of an Assessing Officer. Ostensibly, sub-section (1) of Section 124 contemplates vesting with the A.O jurisdiction over a specified area by virtue of any direction or order issued under sub-section (1) and sub-section (2) of Section 120 of the Act. On the other hand sub-section (2) of Section 124 29 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 contemplates the manner in which any controversy as regards the territorial jurisdiction of an A.O is to be resolved. Apropos, sub-section (3) of Section 124 of the Act, the same places an embargo upon an assessee to call in question the jurisdiction of the A.O where he had initially not raised such objection within a period of one month from the date on which he was served with a notice under sub-section (1) of Section 142 or sub-section (2) of Section 143. In sum and substance, the obligation cast upon an assessee to call in question the jurisdiction of the A.O as per the mandate of sub-section (3) of Section 124 is confined to a case where the assessee objects to the assumption of territorial jurisdiction by the A.O, and not otherwise. Our aforesaid view is fortified by the judgment of the Hon'ble High Court of Bombay in the case of Peter Vaz Vs. CIT, Tax Appeal Nos. 19 to 30 of 2017, dated 05.04.2021 and that of the Hon'ble High Court of Gujarat in the case of CIT Vs. Ramesh D Patel (2014) 362 ITR492 (Guj.). In the aforesaid cases the Hon'ble High Courts have held that as Section 124 of the Act pertains to territorial jurisdiction vested with an AO under sub-section (1) or sub- section (2) of Section 120, therefore, the provisions of sub-section (3) of Section 124 which places an embargo on an assessee to raise an objection as regards the validity of the jurisdiction of an A.O would get triggered only in a case where the dispute of the assessee is with respect to the territorial jurisdiction and would have no relevance in so far his inherent jurisdiction for framing the assessment is concerned. Also, support is drawn from a recent judgment of the Hon'ble High Court of Calcutta in the case of Principal Commissioner of Income-tax Vs. 30 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 Nopany & Sons (2022) 136 taxmann.com 414 (Cal). In the case before the Hon'ble High Court the case of the assessee was transferred from ITO, Ward-3 to ITO, Ward-4 and the impugned order was passed by the ITO, Ward-4 without issuing notice u/s 143(2), i.e. only in pursuance to the notice that was issued by the ITO, Ward-3, who had no jurisdiction over the assessee at the relevant time. The Hon'ble High Court considering the fact that as the assessment was framed on the basis of the notice issued under Sec. 143(2) by the assessing officer who had no jurisdiction to issue the same at the relevant point of time quashed the assessment. Apart from that, the aforesaid view is also supported by the order of the ITAT, Kolkata 'B' Bench in the case of OSL Developers (p) Ltd. Vs. ITO, (2021) 211 TTJ (Kol) 621 and that of ITAT, Gauhati Bench in the case of Balaji Enterprise Vs. ACIT (2021) 187 ITD 111 (Gau.). Accordingly, on the basis of our aforesaid observations, we are of the view that as the assessee's objection to the validity of the jurisdiction assumed by the Jt. CIT, Range-1, Bilaspur is not an objection to his territorial jurisdiction, but in fact an objection to the assumption of inherent jurisdiction by him in absence of an order u/s.120(4)(b) of the Act, therefore, the provisions of sub-section (3) of Section 124 would not assist the case of the revenue.
30. In fact, we find that the Hon'ble High Court of Bombay in the case of Bansilal B. Raisoni & Sons Vs. ACIT, Central Circle-1, Nashik & Anr, WP No.13391 of 2018 had, inter alia observed that the time limit for raising objection to the jurisdiction of the Assessing Officer prescribed under sub section (3) of Section 31 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 124 has a relation to the Assessing Officer's territorial jurisdiction. It was further observed that the time limit prescribed would not apply to a case where the assessee contends that the action of the Assessing Officer is without authority of law and, therefore, wholly without jurisdiction. Also, we find that the Hon'ble High Court of Bombay in the case of CIT-1, Nagpur Vs. Lalitkumar Bardia, (2017) 84 taxmann.com 213 (Bom) had addressed the contention of the department that where the assessee had not objected to the jurisdiction within the time prescribed under sub-section (3) of Section 124 of the Act, then, having waived its said right, it was barred from raising the issue of jurisdiction after having participated in the assessment proceedings. The Hon'ble High Court had observed that the waiver can only be of one's right/privilege but non-exercise of the same will not bestow jurisdiction on a person who inherently lacks jurisdiction. Therefore, the principle of waiver cannot be invoked so as to confer jurisdiction on an Officer who is acting under the Act when he does not have jurisdiction. The Hon'ble High Court while concluding as hereinabove had relied on the judgment of the Hon'ble Supreme Court in the case of Kanwar Singh Saini Vs. High Court of Delhi, 2012 (4) SCC
307. The Hon'ble Apex Court in its aforesaid judgment had held that it is the settled legal proposition that conferment of jurisdiction is a legislative function and it can neither be conferred with the consent of the parties nor by a superior court. The Hon'ble Apex Court further observed that if the court passes order/decree having no jurisdiction over the matter, it would amount to a nullity as the matter goes to the roots of the cause. Also, the Hon'ble Apex Court clarified that an issue can be 32 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 raised at any belated stage of the proceedings including in appeal or execution. Elaborating further, it was observed by the Hon'ble Apex Court that the finding of a court or tribunal becomes irrelevant and unenforceable/inexecutable once the forum is found to have no jurisdiction. It was further observed by the Hon'ble Apex Court that acquiescence of a party equally should not be permitted to defeat the legislative animation and the court cannot derive jurisdiction apart from the statute. For the sake of clarity, the observations of the Hon'ble Apex Court in the case of Kanwar Singh Saini Vs. High Court of Delhi (supra) are culled out as under:
"22. There can be no dispute regarding the settled legal proposition that conferment of jurisdiction is a legislative function and it can neither be conferred with the consent of the parties nor by a superior court, and if the court passes order/decree having no jurisdiction over the matter, it would amount to a nullity as the matter goes to the roots of the cause. Such an issue can be raised at any belated stage of the proceedings including in appeal or execution. The finding of a court or tribunal becomes irrelevant and unenforceable/inexecutable once the forum is found to have no jurisdiction. Acquiescence of a party equally should not be permitted to defeat the legislative animation. The court cannot derive jurisdiction apart from the statute. (Vide United Commercial Bank Ltd v. Workmen, Nai Bahu v. Lala Ramnarayan, Natraj Studios (P) Ltd. v. Navrang Studios, Sardar Hasan Siddiqui v. STAT, A.R. Antulay v. R.S. Nayak, Union of India v. Deoki Nandan Aggarwal, Karnal Improvement Trust v. Parkash Wanti, U.P. Rajkiya Nirman Nigam Ltd. v. Indure (P) Ltd., State of Gujarat v. Rajesh Kumar Chimanlal Barot, Kesar Singh v. Sadhu, Kondiba Dagadu Kadam v. Savitribai Sopan Gujar and CCE v. Flock (India) (P) Ltd.)"
31. We, thus, are of the view that as the Jt. CIT, Range-1, Bilaspur in absence of any order passed by the specified authority u/s. 120(4)(b) of the Act had no jurisdiction to frame the assessment in the case of the assessee company before us, therefore, the calling into question of the same by the assessee company before us would not be hit by the prescribed time limit contemplated in Section 33 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 124(3) of the Act, which as observed by us hereinabove, is in context of the territorial jurisdiction of the A.O. Apart from that, as held by the Hon'ble Supreme Court in the case of Kanwar Singh Saini Vs. High Court of Delhi (supra), as the Jt. CIT, Range-1, Bilaspur in absence of any order in writing u/s. 120(4)(b) of the Act had wrongly assumed jurisdiction and framed the assessment vide his impugned order u/s. 143(3) of the Act dated 01.03.2013, therefore, the assessee company remained well within its right to challenge the absence of his inherent jurisdiction to frame the impugned assessment in the course of the proceedings before us.
32. We, thus, in terms of our aforesaid observations, quash the order passed by the Jt. CIT, Range-1, Bilaspur u/s. 143(3) of the Act dated 01.03.2013 for want of valid assumption of jurisdiction on his part.
33. As we have quashed the assessment for want of valid assumption of jurisdiction, therefore, we refrain from adverting to and dealing with the contentions raised by the assessee company qua the merits of the case which, thus, are left open.
34. In the result, appeal filed by the assessee company in ITA No.201/RPR/2017 for A.Y.2010-11 is allowed in terms of our aforesaid observations.
ITA No.202/RPR/2017
A.Y.2011-12 34 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017
35. In the captioned appeal, the assessee company has assailed the impugned order of the CIT(Appeals) on the following grounds of appeal:
"1. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making addition of Rs 7,53,54,684/- to total income as per the provision of clause (ii) & (iii) of Rule 8D of IT Rules, and made addition u/s 14A of the Act and adding'' same to book profit for calculating MAT u/s 115JB of Income Tax Act, 1961 and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
2. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making addition of Rs. 1,04,86,57,120/- notionally to total income on account of lower rate of power tariff on account of sales to the holding company and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
3. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of the expenditure of Rs 1,30,31,661/- incurred under Rehab Compensation Scheme and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
4. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of the expenditure of Rs.6,50,24,740/- incurred on account of Community Welfare and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
5. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of Rs.4,22,18,354/- on account of additional depreciation and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
6. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of personnel and administrative expenses amounting to Rs.36,28,02,180/- and adding the same in income not eligible for deduction u/s 80IA of the Act and confirmed by Ld. CIT(A), the same is against the facts & also against aw, hence may kindly be deleted.
7. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in adding current investment amounting to Rs.1,51,155/- to total income and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.35
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017
8. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of Rs.43,73,770/- on account of employee welfare fund and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
9. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of service charges amounting to Rs.2,11,495/- u/s. 40(a)(ia) of the Act and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
10. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of flying charges amounting to Rs.30,10,101/- and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
11. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in making disallowance of Rs 5,02,11,500/- towards reversal of sale bill as a prior period expenses and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
12. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law by treating investment income, under the head STCG amounting to Rs.5,55,69,182/- generated from sale/ purchase of mutual funds, as business income and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
13. That the Ld. A.O has grossly erred on facts and in the circumstances of the case and in law in disallowing credit of TDS/TCS amounting to Rs 22,04,251/- and confirmed by Ld. CIT(A), the same is against the facts & also against the law, hence may kindly be deleted.
14. The appellant reserves its right to add, amend, or alter the grounds of appeals on or before the date: the appeal is finally heard for disposal."
The assessee company vide an application dated 07.03.2022 has raised additional grounds of appeal which reads as under:
"1. That, the assessment order passed dated 29.01.2014 for AY 2011-12 by the Joint Commissioner of Income Tax (JCIT) is illegal, bad in law and without jurisdiction as the JCIT was not the competent person to pass the said assessment order.36
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017
2. That, the JCIT who passed the assessment order dated 29.01.2014 was not competent to pass the said order and as such the assessment order is liable to be quashed."
As the adjudication of the additional ground involves purely a question of law which would not require looking any further beyond the facts available on record, therefore, we have no hesitation in admitting the same. Our aforesaid view that where an assessee, had raised, though for the first time, an additional ground of appeal before the Tribunal which involves purely a question of law and requires no further verification of facts, then, the same merits admission finds support from the judgment of the Hon'ble Supreme Court in the case of National Thermal Power Company Ltd. Ltd. Vs. CIT (1998) 229 ITR 383 (SC).
36. Succinctly stated, the assessee company had filed its return of income for A.Y.2011-12 on 29.09.2011, declaring "book profit" of Rs.2,495,67,71,210/- u/s. 115JB of the Act. The return of income filed by the assessee company was initially processed u/s. 143(1) of the Act. Subsequently, the case of the assessee company was selected for scrutiny assessment u/s. 143(2) of the Act.
37. Assessment was, thereafter, framed by the A.O vide his order passed u/s. 143(3) of the Act, dated 29.01.2014 determining the income of the assessee company under the normal provisions at Rs.224,25,56,784/- and "book profit" u/s. 115JB of the Act of Rs.2,503,21,25,897/- after inter alia, making the following additions/ disallowances:
37
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 38 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017
38. Aggrieved the assessee company carried the matter in appeal before the CIT(Appeals) who upheld the additions/disallowances made by the A.O. 39 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017
39. The assessee company being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before us.
40. Shri Salil Kapoor, the Ld. AR for the assessee company submitted that alike the earlier appeal, i.e. ITA No.201/RPR/2017 for A.Y.2010-11, the Jt. CIT, Range- 1, Bilaspur in the present case had also wrongly assumed jurisdiction and without any order u/s. 120(4)(b) of the Act, framed assessment vide his impugned order u/s. 143(3) of the Act dated 29.01.2014.
41. The Ld. DR relied on his contentions that were advanced by him in ITA No.201/RPR/2017 for A.Y.2010-11.
42. We have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and material available on record as well as considered the judicial pronouncements that have been pressed into service by them to drive home their respective contentions.
43. Admittedly, it is a matter of fact borne from record that a letter dated 12.06.2023 (supra) and 08.01.2024 (supra) of the DCIT, Circle-1(1), Bilaspur have been placed on our record pertaining to both the subject years before us, i.e. A.Ys. 2010-11 and 2011-12. As in the present case before us, i.e. ITA No.202/RPR/2017, the Jt. CIT, Range-1, Bilaspur had framed the assessment u/s. 143(3) of the Act dated 29.01.2014 in absence of any order u/s.120(4)(b) of the Act and, thus, wrongly assumed jurisdiction, therefore, our observations recorded while disposing off the appeal in ITA No.201/RPR/2017 for A.Y.2010-11 shall mutatis mutandis 40 Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur ITA Nos.201 & 202/RPR/2017 apply for disposing of the captioned appeal, i.e. ITA No.202/RPR/2017 for A.Y.2011-12. In this case also, we quash the order passed by the Jt. CIT, Range-1, Bilaspur u/s. 143(3) of the Act dated 29.01.2014 for want of valid assumption of jurisdiction on his part.
44. As we have quashed the assessment for want of valid assumption of jurisdiction, therefore, we refrain from adverting to and dealing with the contentions raised by the assessee company qua the merits of the case which, thus, are left open.
45. In the result, appeal filed by the assessee company in ITA No.202/RPR/2017 for A.Y.2011-12 is allowed in terms of our aforesaid observations.
46. In the result, both the appeals of the assessee company are allowed in terms of our aforesaid observations.
Order pronounced in open court on 25th day of June, 2024.
Sd/- Sd/-
ARUN KHODPIA RAVISH SOOD
(ACCOUNTANT MEMBER) (JUDICIAL MEMBER)
रायपरु / RAIPUR ; दनांक / Dated : 25th June, 2024.
****SB
41
Jindal Power Limited Vs. Jt. CIT, Range-1, Bilaspur
ITA Nos.201 & 202/RPR/2017
आदे श क त ल प अ े षत / Copy of the Order forwarded to :
1. अपीलाथ / The Appellant.
2. यथ / The Respondent.
3. The CIT(Appeals), Bilaspur (C.G.)
4. The Pr. CIT, Raipur-1 (C.G)
5. वभागीय त न ध, आयकर अपील य अ धकरण, रायपुर बच,
रायपुर / DR, ITAT, Raipur Bench, Raipur.
6. गाड फ़ाइल / Guard File.
आदे शानस
ु ार / BY ORDER,
// True Copy //
Senior Private Secretary
आयकर अपील य अ धकरण, रायपरु / ITAT, Raipur.