TaxTMI 
TaxTMI 
2019 (6) TMI 658
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....e assessment order dated 28th December, 2011 issued by the learned Assessing Officer is bad in law and void ab initio as the same has been passed in violation of section 144C of the Income-tax Act, 1961. 2] The appellant company submits that the learned Assessing Officer erred in issuing the notice of demand notice u/s. 156 and penalty notice u/s. 274 r.w.s. 271(1)(c) along with the assessment order dated 28.12.2011 instead of draft assessment order and hence, since the procedure laid down in section 144C was not followed by the learned A.O., the assessment order passed be held invalid in law. 3] Without prejudice to the above additional grounds of appeal, the appellant company submits that the adjustment on account of working capital ought to have been granted while computing the operating margins of the comparables. The appellant submits that the additional grounds raised are legal in nature and as all the facts are on record, the assessee requests for admission of the above ground." 3. Shri Nikhil Pathak appearing on behalf of the assessee submitted that the assessee is engaged in the business of manufacturing and selling of Passenger Cars and trading in spare parts and a....
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....Ltd. Vs. Dispute Resolution Panel, 46 taxmann.com 100 (Mad.); iv. ACIT Vs. Skoda Auto India Pvt. Ltd. in ITA No. 39/PUN/2011 for assessment year 2003-04 decided on 31-12-2018; v. DCIT Vs. M/s. Rehau Polymers Pvt. Ltd. in ITA No. 566/PUN/2015 for assessment year 2010-11 decided on 14-06-2017; vi. Soktas India Pvt. Ltd. Vs. Asstt. CIT in ITA No. 206/PN/2015 for assessment year 2010-11 decided on 09-12-2016. 4. On the other hand Shri S.B. Prasad representing the Department vehemently defended the assessment order and prayed for dismissing the additional grounds raised by the assessee. The ld. DR submitted that due procedure has been followed by the authorities below in passing the final assessment order. The Assessing Officer after receiving the order from TPO u/s. 92CA(3) passed the Draft Assessment Order on 28-12-2011 u/s. 143(3) r.w.s. 144C of the Act. The assessee thereafter, filed objections before DRP. The objections of assessee were disposed of by DRP vide directions dated 30-07-2012. Thereafter, the final assessment order was passed by the Assessing Officer on 31-10-2012. Nowhere, in the proceedings before DRP or the Assessing Officer the assessee raised objections chal....
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....ion 144C and hence, such final assessment order is unsustainable. 7. The Hon'ble Bombay High Court in the case of Pr. Commissioner of Income Tax Vs. Lionbridge Technologies Pvt. Ltd. (supra) has held : "11 It must be noted that in respect of the procedure and determination of the ALP of International Transaction between related person, the law provides a special dispensation. In terms of Section 144C(I) of the Act, the Assessing Officer is to first pass a draft Assessment Order which is subject to challenge, by way of representation to the DRP. It is only after the DRP disposes of the representation, that the Assessing Officer passes a final order in terms of the directions of the DRP and such final order is appellable to the Tribunal. In this case, it is undisputed that on 12th March, 2014, the Assessing Officer passed a final Assessment Order in terms of the directions made by the DRP in the earlier round. The time to pass any such order, would expire in the present facts on 31 st March, 2014, however, in case a Draft Assessment Order is issued, then the time to pass a final Assessment Order gets extended to one month after the passing of the directions by the DRP in terms of ....
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....sessment Order. Therefore, making a reference again to the TPO for fixing the ALP, was not called for. Nothing has been pointed out to us which would even remotely suggest that the same is not correct." The Hon'ble High Court in an unambiguous term has held that where the assessment order has been passed without jurisdiction, the objection can be raised at any time and the principle of estoppels will not apply if the assessee has participated in the subsequent proceedings. Thus, the contentions of the ld. DR that the assessee has not raised the issue of validity of assessment order before DRP and Assessing Officer is without any merit. 8. We find that in assessee's own case for assessment year 2003-04 the Assessing Officer in similar set of facts had passed the assessment order and had issued notice of demand u/s. 156 of the Act along with the penalty notice. Thereafter, the Assessing Officer issued a letter that the assessment order needs to be treated as Draft Assessment Order. However, the Assessing Officer failed to withdraw the original demand notice and the penalty notice already issued. The assessee challenged the aforesaid final assessment order before Tribunal. The T....