Limitation for final assessment under 144C read with 153: time-barred orders exceed jurisdiction and are quashed

Limitation for passing a final assessment under section 144C(13) must be determined by reference to section 144C read with section 153, because the provisions overlap and operate inclusively; applying that combined timeline, orders issued beyond that period are without jurisdiction. The tribunal followed the Madras High Court's reasoning rejecting the Revenue's attempt to apply section 144C(13) in isolation, found the dates in the assessee's table undisputed, and held that the final assessment orders challenged were time-barred and therefore quashed as lacking jurisdiction.

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Issues: Whether the final assessment orders passed under section 144C(13) of the Income-tax Act, 1961 read with section 153 of the Income-tax Act, 1961 are barred by limitation and therefore void for want of jurisdiction.

Analysis: The Tribunal examined the interplay between section 144C and section 153, having regard to the statutory timelines for draft orders, DRP directions and finalisation of assessment. The Tribunal considered the Madras High Court decision in Roca Bathroom Products P. Ltd., which held that sections 144C and 153 are mutually inclusive and that the outer time limits under section 153 apply to proceedings remanded to DRP/AO; it also considered the Department's contention that section 144C is a self-contained code with its own timelines and the objections based on pendency before the Supreme Court. The Tribunal rejected the preliminary objection to adjudication, followed the reasoning in Roca Bathroom that the limitation period for finalising assessment on remand must be determined with reference to section 144C read with section 153, and compared the uncontested date charts showing the dates of draft order, DRP directions, statutory due dates and actual dates of final orders in the appeals. On those facts, the final assessment orders were found to have been passed after the applicable limitation period prescribed by section 144C(13) r.w.s. 153.

Conclusion: The final assessment orders passed beyond the period of limitation under section 144C(13) read with section 153 are without jurisdiction and are quashed; decision is in favour of the assessee.

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