ITAT President not empowered to Transfer Live Appeals from one bench of ITAT to other outside Headquarters: Bombay HC [Read Judgment]

ITAT - Bombay High Court - Taxscan

The Bombay High Court held that the President of the Income Tax Appellate Tribunal (ITAT) is not empowered to transfer live appeals from one bench of the ITAT to another bench outside the headquarters.

The assessee, MSPL Ltd. submitted that pursuant to a search operation u/s.132 of the IT Act, separate orders of assessment u/s.153A were framed by the ACIT, CC-2(1), Bangalore. Aggrieved, an appeal before CIT(A) was unsuccessful and therefore, the further appeal was preferred before the ITAT Bangalore. In the meantime, when the appeal was pending disposal with the ITAT, the jurisdiction of the Assessing Officer was transferred to Mumbai – DCIT-1(2)(2), Mumbai due to decentralization of search cases and corresponding CIT-1, Mumbai was given charge over the jurisdiction.

The said appeals were partly heard on 02.06.2011 and was adjourned for further submissions from the parties. On 28.06.2011, written submissions were filed by the Department. Subsequently, on 08.09.2011, the Accountant member was transferred. 

The impugned orders in the instant WP are the order of the ITAT Bangalore transferring the appeal to Mumbai ITAT vide order dated 19.03.2020 and the order of the President of ITAT passed under Rule 4 dated 20.08.2020.

Mr. R. V. Desai, Senior Advocate on behalf of the department submitted that the assessee did not object to the transfer of the assessment proceedings under section127 of the IT Act. Post transfer of jurisdiction the assessee has been regularly filing its return of income at Mumbai and certain appeals before the Mumbai Appellate bodies.

Mr. Desai urged that the power to transfer the appeals between the tribunals is clearly traceable in Section 255(5) of the Income Tax Act and that when read in consonance with Rule 4 of the ITAT Rules, 1963 that the transfer of appeals are permissible. An appeal u/s.260A ought to have been filed by placing emphasis on the word “every order” as contemplated in Section 260A.

The division bench of Milind N. Jadhav and Ujjal Bhuyan held that as per sub-rule (1) of Rule 4, a Bench shall hear and determine such appeals and applications made under the Act as the President may by general or special order direct. Subrule (2) says that where there are two or more Benches of the Tribunal working at any headquarters, the President or, in his absence, the Senior Vice President or Vice President of the concerned zone or in his absence the senior-most member of the station present at the headquarters may transfer an appeal or an application from any one of such Benches to any other. While sub-rule (1) empowers the President to direct the hearing of appeals by a Bench by a general or special order, sub-rule (2) is more specific. It deals with a situation where there are more than two Benches of the Tribunal at any headquarter; when there are multiple Benches in a headquarter, the President or, in his absence the Senior Vice President, etc. may transfer an appeal or an application from one of such Benches to any other. Meaning thereby that it is a transfer of an appeal or an application from one Bench to another Bench within the same headquarters.

The court while giving the example said that in Mumbai the number of Benches is twelve and in Bangalore, the number of Benches is three. Thus, this provision can be invoked to transfer an appeal from one Bench in Mumbai to another Bench in Mumbai or from one Bench in Bangalore to another Bench in Bangalore. But this provision cannot be invoked to transfer a pending appeal from one Bench under one headquarter to another Bench in a different headquarter.

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