Assessment under Section 144C: objections ruled timely per CBDT circular; DRP heard merits and assessment set aside.

Assessment under Section 144C concerned objections filed before the DRP; relying on the CBDT circular dated 30.04.2021, the objections were treated as filed within time and the DRP has now heard them on merits. The court set aside the impugned final assessment order dated 30.06.2021 because the statutory procedure under Section 144C was not followed, and directed the revenue to proceed in accordance with the procedural scheme prescribed by Section 144C, restoring the requirement for DRP consideration and compliance with the applicable procedural safeguards.

---

---

Issues:
Challenge to Final Assessment Order under IT Act for AY 2017-18, Timeliness of objections filed before DRP, Jurisdiction of Assessing Officer, Compliance with CBDT Circular, Applicability of relevant judgments.

Analysis:
The petitioner challenged the Final Assessment Order dated 30.06.2021 under Section 143(3) read with Section(s) 144C(3) and 144B of the Income Tax Act, 1961 for AY 2017-18. The petitioner's objections were filed within the extended time limit as per CBDT Circular No. 08 of 2021 dated 30.04.2021, which allowed objections to be filed by 31.05.2021. The Transfer Pricing Officer made adjustments on international transactions, leading to a Draft Assessment Order dated 21.04.2021. The petitioner filed objections before the DRP on 27.05.2021, within the extended time frame. The petitioner contended that the Final Assessment Order was without jurisdiction as objections were filed within the permitted time, citing relevant judgments to support the argument.

The respondent argued that since the petitioner failed to inform the Assessing Officer about filing objections before the DRP, the Assessing Officer proceeded to complete the assessment based on the Draft Assessment Order. The petitioner later informed that the DRP had heard the objections on merit on 30.11.2021. Citing a Bombay High Court judgment, the petitioner sought to set aside the Assessment Order until the DRP passed its order on the objections.

The Court considered the submissions and the CBDT Circular, noting that the objections were filed within the extended time frame and had been heard on merit by the DRP. Relying on judgments from the Delhi High Court, Calcutta High Court, and Bombay High Court, the Court set aside the Final Assessment Order dated 30.06.2021, directing the respondent to follow the procedure outlined in Section 144C of the Act. The writ petition and pending applications were disposed of with no order as to costs.

---