Facts of the Case

The petitioner, an individual assessee, filed his return for AY 2009–10 in Delhi. Based on Annual Information Return (AIR) data, the Income Tax Officer (ITO), Noida received information about cash deposits of ₹12,89,609 in a bank account located in Noida.

The Noida ITO issued notices under Section 133(6) and later under Section 148 for reassessment. The petitioner failed to respond initially and later challenged the notice, claiming:

  • Lack of jurisdiction of Noida ITO
  • Improper transfer of case without following Section 127 procedure

The case was subsequently transferred to Delhi jurisdiction.

Issues Involved

  1. Whether the notice issued under Section 148 by the Noida ITO was without jurisdiction?
  2. Whether transfer of the case without compliance of Section 127 invalidated proceedings?
  3. Whether delayed objection by the assessee bars jurisdictional challenge under Section 124?

Petitioner’s Arguments

  • The petitioner was regularly assessed in Delhi; hence Noida ITO had no jurisdiction.
  • Transfer of case was invalid due to non-compliance of Section 127(2)(a) (no order by competent authority).
  • Notice under Section 148 was not properly served before limitation period.
  • Proceedings were illegal and void ab initio.

Respondent’s Arguments

  • Jurisdiction arose due to bank account and transaction location in Noida.
  • Multiple notices were issued and served at available addresses.
  • The assessee deliberately avoided responding to notices.
  • Objection to jurisdiction was time-barred under Section 124(3).
  • Jurisdiction provisions are procedural; defect does not invalidate proceedings.

Court Findings / Order

The Delhi High Court dismissed the writ petition and held:

  • Concurrent Jurisdiction Valid:
    Under Sections 120 & 124, more than one Assessing Officer can have jurisdiction simultaneously.
  • Jurisdiction Objection Time-Barred:
    Assessee failed to raise timely objection as required under Section 124(3).
  • Procedural Defect ≠ Nullity:
    Even if there was irregularity in jurisdiction or transfer, it is procedural, not fatal to proceedings.
  • Deliberate Non-Compliance:
    Court observed that the petitioner intentionally avoided responding to notices to raise technical objections later.
  • Reassessment Notice Valid:
    Notice under Section 148 was legally sustainable and proceedings were not void.

Important Clarifications by Court

  • Jurisdiction under Income Tax Act is administrative and procedural, not strictly territorial.
  • Concurrent jurisdiction is permissible and recognized under law.
  • Failure to object within statutory time results in deemed waiver of jurisdictional challenge.
  • Distinction between:
    • Lack of jurisdiction (fatal)
    • Irregular exercise of jurisdiction (curable defect)

Link to download the order -https://delhihighcourt.nic.in/app/case_number_pdf/2018:DHC:3678-DB/SKN01062018CW118442016.pdf

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