Tax Assessment Orders Quashed for 2015-16 & 2016-17 Due to Limitation; TPO Order Declared Void for Exceeding Timeline.

The Tribunal allowed the assessee's appeals for the assessment years 2015-16 and 2016-17, quashing the final assessment orders for being barred by limitation. The TPO's order was also quashed as void ab initio due to exceeding the prescribed timeline. Consequently, other issues in the appeals were deemed academic and infructuous.

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Issues Involved:
1. Delay in filing the appeal.
2. Admission of additional grounds of appeal.
3. Validity of the final assessment order based on the timeline prescribed under section 153 of the Income Tax Act.
4. Validity of the Transfer Pricing Officer's (TPO) order based on the timeline prescribed under section 92CA(3A) read with section 153 of the Act.

Summary:

Issue 1: Delay in Filing the Appeal
The assessee filed the appeal after a delay of 333 days, citing pandemic-related restrictions in Maharashtra. The appeal was submitted via email on 04/06/2021 and in physical form on 05/05/2022. The Hon'ble Supreme Court extended the limitation period for filing the appeal up to 29/05/2022. Hence, there was no delay in filing the appeal.

Issue 2: Admission of Additional Grounds of Appeal
The assessee sought admission of additional grounds challenging the validity of the final assessment order and the TPO's order based on the prescribed timelines. The Tribunal admitted these grounds, considering them legal issues that could be decided based on the material available on record, in line with the Hon'ble Supreme Court's decision in NTPC Ltd vs CIT.

Issue 3: Validity of the Final Assessment Order
For the assessment year 2015-16, the final assessment order dated 06/04/2021 was challenged as being beyond the prescribed time limit under section 153 of the Act. The Tribunal noted that the due date for completing the assessment was 31/12/2019, considering the extensions provided under sections 153(4) and 92CD(5)(b) of the Act. Since the final assessment order was passed on 06/04/2021, it was deemed barred by limitation and void ab initio.

Issue 4: Validity of the TPO's Order
The TPO's order dated 01/11/2019 was challenged as being beyond the time limit prescribed under section 92CA(3A) read with section 153 of the Act. The Tribunal, following the Hon'ble Madras High Court's decision in Pfizer Healthcare India Private Ltd, held that the TPO's order should have been passed on or before 31/10/2019. Since the TPO's order was passed on 01/11/2019, it was barred by limitation and quashed as void ab initio. Consequently, the assessee was not an "eligible assessee" under section 144C(15)(b) of the Act, and the draft assessment order dated 30/12/2019 was without jurisdiction.

Conclusion:
Both appeals by the assessee for the assessment years 2015-16 and 2016-17 were allowed, with the final assessment orders being quashed due to being barred by limitation. Other issues raised in the appeals were rendered academic and infructuous. The order was pronounced in open Court on 07/08/2023.

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