Tribunal nullifies assessment order, rules in favor of assessee, deems revenue's appeal infructuous. Assessment order invalidated.

The Tribunal annulled the assessment order dated 09-01-2015, ruling in favor of the assessee and dismissing the revenue's appeal as infructuous. The Tribunal found that the assessment order dated 12-03-2014 was invalid due to non-compliance with statutory provisions, rendering it null and void. The corrigendum issued by the assessing officer was deemed ineffective in rectifying the initial mistake. The final assessment order was declared without jurisdiction, null, void, and unenforceable.

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Issues Involved:
1. Validity of the assessment order passed by the assessing officer.
2. Compliance with the provisions of Section 144C(1) of the Income Tax Act.
3. Time limit for completing the assessment as per Section 153(2A) of the Income Tax Act.
4. Impact of the corrigendum issued by the assessing officer.

Issue-wise Detailed Analysis:

1. Validity of the Assessment Order Passed by the Assessing Officer:
The assessee challenged the validity of the assessment order dated 09-01-2015, arguing that the final assessment order dated 12-03-2014 was passed without adhering to the mandate of Section 144C(1) of the Income Tax Act, which requires the issuance of a draft assessment order to the eligible assessee before finalizing the assessment. The assessee contended that the subsequent corrigendum issued on 16-04-2014 could not rectify the mistake, rendering the assessment order a nullity in the eyes of law. The Tribunal agreed with the assessee, noting that the assessing officer had indeed issued a notice of demand and penalty notice, indicating the intention to treat the order dated 12-03-2014 as final.

2. Compliance with the Provisions of Section 144C(1) of the Income Tax Act:
The Tribunal observed that the assessing officer failed to follow the directions of the Tribunal's order dated 25-01-2012, which had set aside the assessment order and restored the matter to the stage of the draft assessment order. The assessing officer was required to forward a copy of the draft order to the assessee as per Section 144C(1) of the Act, but instead, he passed a final assessment order on 12-03-2014. The Tribunal emphasized that the assessing officer's failure to adhere to the statutory mandate of Section 144C(1) rendered the assessment order invalid.

3. Time Limit for Completing the Assessment as per Section 153(2A) of the Income Tax Act:
The Tribunal noted that the assessing officer himself had observed that the time limit for completing the assessment was extended up to 31-03-2014 as per the third proviso to Section 153(2A) of the Act. Since the draft order was not forwarded to the assessee within this time limit, the Tribunal held that the assessment order dated 12-03-2014 was passed in violation of the statutory provisions, making it null and void. The Tribunal also rejected the revenue's contention that the provisions of Section 144C(13) override the time limit prescribed under Section 153, clarifying that Section 144C(13) operates for a limited purpose and comes into effect only after the receipt of directions from the Dispute Resolution Panel (DRP).

4. Impact of the Corrigendum Issued by the Assessing Officer:
The Tribunal was not persuaded by the revenue's argument that the corrigendum issued on 16-04-2014, which reclassified the assessment order dated 12-03-2014 as a draft assessment order, could rectify the initial mistake. Citing the decisions in Zuari Cement Limited Vs. ACIT and Vijay Television Private Limited Vs. DRP, the Tribunal held that such a defect or failure to adhere to statutory provisions is not a curable defect by virtue of a subsequent corrigendum. The Tribunal concluded that the assessment order dated 12-03-2014 should be construed as a final assessment order passed in violation of the statutory provisions, making it without jurisdiction, null and void, and unenforceable.

Conclusion:
The Tribunal annulled the assessment order dated 09-01-2015, treating the appeal filed by the assessee as allowed and dismissing the revenue's appeal as infructuous. The order was pronounced in the open court on 29th May, 2015.

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