Chhattisgarh High Court Upholds Validity of Income Tax Assessment Based on PAN Address

Court Affirms Jurisdiction of Assessing Officer Using PAN Address Despite Business Location Claims

The Chhattisgarh High Court has dismissed an appeal by Harish Kumar Chhabada, confirming the validity of an income tax assessment conducted based on the PAN database address. The appellant had contested the jurisdiction of the Assessing Officer, arguing that his place of business should dictate jurisdiction rather than his residential address as recorded in the PAN database.

In a detailed judgment delivered on October 8, 2025, the Division Bench comprising Justices Sanjay K. Agrawal and Radhakishan Agrawal upheld the assessment made by the Income Tax Officer (ITO), Ward-2(1), Raipur. The court noted that the appellant, who trades in electrical goods, had failed to update his address in the PAN database and did not object to the jurisdiction within the statutory period.

The Court observed that under Section 124(3)(a) of the Income Tax Act, objections to the jurisdiction of the Assessing Officer must be raised within one month of receiving the notice or before the assessment's completion, whichever is earlier. The appellant's failure to raise timely objections resulted in a waiver of his right to contest the jurisdiction.

The judgment emphasized that the PAN database address is a valid basis for jurisdiction, citing the Supreme Court’s decision in Principal Commissioner of Income-tax, Mumbai v. I-Ven Interactive Ltd., which supports the issuance of notices based on PAN addresses when no updated address is provided.

Despite the appellant's claims that his business location should determine jurisdiction, the court found that the reallocation of territorial jurisdiction to ITO, Ward-2(1), Raipur, following a notification on November 15, 2014, was lawful. The Assessing Officer’s actions were deemed valid by operation of law, reinforcing the assessment's legitimacy.

Chhabada's additional appeal to the Income Tax Appellate Tribunal (ITAT) was also dismissed, with the ITAT affirming the validity of the initial notice issued based on the PAN address. The court's decision effectively supports the tax department's jurisdictional processes, ensuring that procedural compliance is upheld.

This ruling underscores the importance for taxpayers to maintain updated records in official databases and to adhere to statutory timelines for raising jurisdictional objections. 

Bottom Line:

Income Tax Act - Objection to jurisdiction of Assessing Officer barred after stipulated time under Section 124(3)(a) - Notice issued based on residential address in PAN database constitutes valid jurisdiction.

Statutory provision(s): Income Tax Act, 1961 Sections 124(3)(a), 143(2), 142(1), 124(4)

Harish Kumar Chhabada v. PR. Commissioner of Income Tax Income Tax Officer-2(1), (Chhattisgarh)(DB) : Law Finder Doc Id # 2791892