Tribunal Rules Assessment Order Null Due to Timeliness and Jurisdiction Issues; Revenue's Appeals Dismissed as Moot.

The tribunal addressed the cross objections by the assessee, challenging the jurisdiction and timeliness of the final assessment order dated February 15, 2018. The tribunal found the assessment order time-barred, as no draft assessment order was required due to the absence of income variation. Consequently, the tribunal allowed the assessee's cross objections and dismissed the Revenue's appeals, ruling the assessment order null and void. The decision, pronounced on 21.07.2022, resolved the jurisdictional and procedural issues, rendering the Revenue's appeals moot.

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Issues:
Two separate appeals by the Revenue against orders of CIT(A) for Assessment Years 2014-15 and 2015-16; Cross objections by assessee against the same order; Disposal of both appeals and cross objections together; Jurisdiction of Assessing Officer in passing final assessment order without jurisdiction; Denial of DTAA benefit between India and Cyprus; Variation in income assessed by Assessing Officer; Validity of draft assessment order under section 144C(1) of the Income-tax Act, 1961; Retrospective application of Finance Bill, 2020 amendment; Time limitation for completion of assessment.

Detailed Analysis:

1. Cross Objections and Jurisdiction Issue:
The cross objections raised by the assessee challenge the validity of the final assessment order dated February 15, 2018, passed by the Assessing Officer, contending it was without jurisdiction, null, void, and unenforceable due to being time-barred. The issue goes to the root of the matter, prompting the tribunal to address the cross objections first.

2. Background and Disputed Facts:
The draft assessment order under section 144C(1) was passed on 22.1.2017, and the assessee chose to appeal before CIT(A) instead of filing objections before DRP. The Assessing Officer subsequently finalized the assessment, denying the DTAA benefit, and taxed the income at 20% under section 115A of the Act.

3. Contentions and Legal Considerations:
The assessee argued that there was no variation in income, questioning the Assessing Officer's justification for the draft assessment order. The Assessing Officer, however, supported the assessment, citing the curative nature of the Finance Bill, 2020 amendment, proposing mandatory draft assessment orders even without income variation.

4. Analysis of Relevant Provisions:
Section 144C(1) mandates forwarding a draft assessment order to eligible assessees if there is a variation in income prejudicial to their interests. In this case, where no such variation existed, the tribunal examined the applicability of the provision, considering the Finance Bill, 2020 amendment and its retrospective effect from 01.04.2020.

5. Precedent and Decision:
The tribunal referred to a similar case in Mumbai where it was held that the assessment order would be time-barred if no draft assessment order was required. Consequently, the tribunal upheld the plea of the assessee, declaring the assessment order time-barred and rendering the revenue's appeals on the merits moot and unnecessary.

6. Final Verdict:
The tribunal allowed the cross objections of the assessee while dismissing the appeals of the Revenue, emphasizing the time-barred nature of the assessment order. The decision was pronounced on 21.07.2022, resolving the jurisdictional and procedural issues raised in the appeals and cross objections comprehensively.

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