Assessment under s.144C time-barred as DRP directions deemed received on NFAC upload, making order beyond limitation.

HC held the assessment under s.144C barred by limitation. The court reckoned receipt of DRP directions as the date they were uploaded to the National Faceless Assessment Centre (17.06.2022), not a later internal transfer to the jurisdictional AO, and therefore the one-month period under s.144C(13) expired on 31.07.2022. The assessment order issued on 25.03.2023 was beyond the statutory time limit and, applying prior Division Bench interpretations, was unsustainable. Decision rendered in favour of the assessee.

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Issues Involved:
The issues involved in the judgment are the challenge to an assessment order dated 25.03.2023 under the Income Tax Act, 1961 for assessment year 2018-2019. The primary grounds of challenge were on limitation and the jurisdictional authority of the assessing officer.

Limitation Grounds:
The petitioner challenged the assessment order on the grounds of limitation, citing Section 144C(13) of the Income Tax Act which sets out the period for passing an assessment order upon receipt of directions from the DRP. The petitioner argued that the directions were received on 17.06.2022, and as per the provision, the limitation period of one month expired on 31.07.2022. Referring to a previous judgment, the petitioner contended that the assessing officer should pass orders within one month, irrespective of the DRP issuing directions within nine months.

Jurisdictional Challenge:
The second ground of challenge was that the jurisdictional assessing officer did not have the authority to issue the assessment order, as per clause (xx) of subsection (1) of Section 144B. The petitioner argued that all orders and directions are required to be communicated electronically as per the E-Assessment Scheme 2019, and the assessing officer did not have the authority to issue the order.

Court's Analysis and Conclusion:
The court examined Section 144C(13) which specifies the time limit for completing the assessment upon receipt of directions from the DRP. The court noted that the directions were uploaded on the ITBA portal on 17.06.2022, and the assessing officer should be considered as having received the directions on that date. The court found that the assessment order issued on 25.03.2023 was beyond the time limit specified in the Act, based on statutory provisions and previous court interpretations. As the assessment proceedings were deemed barred by limitation, the court allowed the petition by quashing the assessment order dated 25.03.2023. The court did not delve into the jurisdictional authority of the assessing officer due to the limitation issue being conclusive.

Outcome:
The court allowed the petition, quashing the assessment order dated 25.03.2023, with no order as to costs. The connected miscellaneous petition was closed accordingly.

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