Case: Industrial Trust Limited Jaipur Vs. The Commissioner of Income Tax (Central &amp; Rajasthan) New Delhi

2. At the relevant time the headquarters of the assessee company was at Jaipur. TheOfficer, Ajmer issued notices under Section 34 of the IndianAct, 1922 (to be hereinafter referred to as the Act) to the assessee calling upon it to submit itsreturns in respect of the assessment years mentioned earlier. In response to those notices the assessee submitted its returns on August 11, 1953. When those returns were pending before the I.T.O., Ajmer, the I.T.O., Central Circle IV, issued fresh notices to the assessee under Section 34 calling upon it to submit itsreturns in respect of those very assessment years. The assessee did not submit any return. On the other hand it wrote a letter to the I.T.O., Central Circle IV, saying that it had already submitted its returns to the I.T.O., Ajmer and hence it could not be called upon to submit fresh returns. Ignoring the objection of the assessee the I.T.O., Central Circle, assessed the assessee. He rejected the assessees objection regarding jurisdiction with theseits letter dated 27th September, 1956, the assessee contended that under Section 64 (1) of the IndianAct, the place of assessment should be where the assessee carried on business, profession or vocation and that as the principal place of the business was at Jaipur, the place of assessment should have been at Jaipur. The assessee also relied upon the decision of the Bidi Supply Co. v. Union of India, in support of its contention. This objection of the assessee regarding the jurisdiction was duly referred to the Commission ofDelhi, who vide his letter dated 30th January, 1957, addressed to the assessee company, informed that the case of assessee has been transferred to theOfficer, Central Circle IV, under Sectionof the IndianAct, and that in view of the facility of investigation and proper assessment it was not possible to accede to the request of the company for transfer of the case back to the territorialOfficer. Moreover, the case of Pannalal Brijraj v. Union of India, has already decided the issue regarding the vires of Section 5The contention of the assessee regarding jurisdiction is, therefore, rejected".

Court's reasoning:
3. From the above observations it is clear that the contention taken before the I.T.O., Central Circle was that the assessee should be asserted by theOfficer, Jaipur who possibly had acquired territorial jurisdiction over the assessee by the time the assessment proceedings were going on before the Central Circle. No objection appears to have been taken on the ground that the Ajmer I.T.O., was seized of the proceedings in view of the notices issued by him under Section 34. The contention now advanced, namely, that in view of the circumstances that the Ajmer I.T.O. had already issued notices under Section 34 and that the assessee had already submitted its returns in response to their notices the I.T.O., Central Circle was incompetent to initiate fresh proceedings under Section 34 against the assessee does not appear to have been taken before the I.T.O., Centralmay be noticed that by its letter datedthe assessee had requested theOfficer, Central Circle, to assess him on the basis of the returns submitted by it to theOfficer, Ajmer. TheOfficer Central Circle, complied with that request. The circumstance under which the I.T.O., Central Circle came to issue notices under Section 34 is set out in the order of the A.A.C. The A.A.C.s order indicates that in respect of Jaipur which was formerly a native State, there have been some changes as regards theset up. Possibly for some time after Jaipurs integration with India, Jaipur was under the jurisdiction of the I.T.O., Ajmer. But that is not clear from the records. All the same it is necessary to note that it was not the contention of the assessee that the I.T.O., Central Circle was not competent to initiate proceedings against it in view of the notices issued by the I.T.O., Ajmer. We have only to examine the correctness of that contention.Jaipur was integrated into India on 7th April, 1949 but for the purposes ofit was integrated as from 1st April, 1950. In view of the aforementioned notification it is clear that theOfficer, Ajmer had jurisdiction over the residents of Jaipur after the issue of that notification only in respect of the assessments pending before him and not in respect of any other assessments.Quite clearly the assessees assessments were not pending before the I.T.O., Ajmer. Hence the contention advanced on behalf of the assessee that the I.T.O., Ajmer had jurisdiction over it in respect of the assessment years in question cannot be upheld. It was never urged either before the I.T.O., or before the Appellate Assistant Commissioner or even before the Tribunal that the I.T.o., Central Circle, had no jurisdiction per se over the assessee. That queston did not come up for consideration before any of the authorities under the Act. We are not called upon to decide that question nor is it possible to decide that question on the basis of the material before us.hence, the rule laid down by this court in Commr. ofBombay City v. Ramchhoddas Karsondas, 36 ITR 569  = (AIR 1959 SC 1154 ) relied on by the appellant has no application on the facts of this case.12. It was next contended by Mr. B. Sen, learned Counsel for the assessee that whether the I.T.O., Ajmer had jurisdiction over the assessee or not that Officer, having issued notices to the assessee under Section 34 and the assessee having submitted its returns in response to those notices, the I.T.O., Central Circle, was not competent to initiate assessment proceedings against the assessee. In support of that contention reliance was placed on the decision of the Madras High Court in Raman Chettiar v. Commr. ofMadras, 42 ITR 700  (Mad). That decision was affirmed by this Court in Commr. ofMadras v. S. Raman Chettiar, 55 ITR 630  = (AIR 1965 SC 1031 ). The question that arose for decision in Raman Chettiars case was whether a return, submitted to anOfficer having jurisdiction, in response to an invalid notice under Section 34, is a valid return. The High Court as well as this Court held that such a return was a valid return. But that is not the case here. herein, the return was submitted to an I.T.O., who had no jurisdiction territorial or otherwise over the assessee. Hence the rule laid down in Raman Chettiars case does not bear on the question arising for decision in this case.