2024 (8) TMI 1368 - HC - Income Tax

Assessment Order Quashed for 2020-21: Court Directs Officer to Await DRP Decision Before Issuing New Order.

M/s. PAR Formulations Private Limited Represented by its Authorized Signatory, Chittibabu Sampath Kumar Versus Assessment Unit/Verification Unit/ Technical Unit/Review Unit Income Tax Department, The Assistant Commissioner of Income Tax Circle 1 LTU, Chennai

M/s. PAR Formulations Private Limited Represented by its Authorized Signatory, Chittibabu Sampath Kumar Versus Assessment Unit/Verification Unit/ ... Issues:Assessment order challenge for assessment year 2020-21 due to objections not considered by DRP.Analysis:The petitioner challenged an assessment order dated 24.11.2023 for the assessment year 2020-21 after filing a revised return of income declaring Rs. 54,36,49,810. The case underwent scrutiny assessment, and objections were filed before the dispute resolution panel (DRP) on 25.10.2023, received by DRP on 27.10.2023. The petitioner claimed that the portal did not allow placing objections before the Assessing Officer, supported by a portal screenshot and an email stating the e-filing facility was closed. However, the assessment order stated the petitioner did not file objections before the DRP, leading to the conclusion that the petitioner had no objection to the draft assessment order.The petitioner argued that objections were timely filed before the DRP, and an email was sent to the Assessing Officer on 30.10.2023 informing about the objections. The petitioner sought to quash the assessment order and requested a fresh assessment after DRP examination. The senior standing counsel for the respondents pointed out that the draft assessment order was issued on 30.09.2023, giving the petitioner thirty days to file objections before the DRP. Since the objections were not placed before the Assessing Officer, the assessment order was issued.The objections filed in Form 35A before the DRP were received on 27.10.2023, as evidenced by the date stamp. The petitioner's claim of timely submission of objections before the DRP was supported by an email on 30.10.2023, attaching the objections. The Assessing Officer issued the assessment order without knowledge of the objections submitted to the DRP, resulting in a significant difference in the petitioner's total income determination. Consequently, the court quashed the assessment order due to the petitioner's objections not being considered by the DRP.The court directed the Assessing Officer to await the DRP's decision before issuing a fresh assessment order, disposing of the case without costs. The related motions were also closed in light of the judgment.