TaxTMI 
TaxTMI 
2019 (6) TMI 1300
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....76/Mds/2016 dated 31.01.2017 for the assessment year 2011-12. 2.The above Tax Case Appeal has been filed raising the following substantial questions of law:- "(i) Whether the Appellate Tribunal is correct in law in setting aside the order of the Dispute Resolution Panel on the misconstruction of the provisions of sub-sections (5), (7) and (8) of Section 144C of the Act even though the issues before the DRP were decided by them based on the materials furnished for reaching their conclusions in para 3.2.1 and para 3.3.4 of the order dated 24.11.2015? (ii) Whether the Appellate Tribunal is correct in law in exceeding the grounds canvassed by the Revenue at the time of filing the appeal, at the time of the hearing as well a....
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.... direct the Assessing Officer or the TPO to make further enquiry and decide the matter and at best can call for remand report from any Income Tax Authority and decide the issue itself by adjudicating the matter. To resolve the controversy raised, it may be necessary for us to take note of Section 144C of the Act and the relevant sub sections which are quoted herein below: "144C(1) The Assessing Officer shall, notwithstanding anything to the contrary contained in this Act, in the first instance, forward a draft of the proposed order of assessment (hereafter in this section referred to as the draft order) to the eligible assessee if he proposes to make, on or after the 1st day of October, 2009, any variation in the income or loss ret....
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....t order was passed by the Assessing Officer under Section 144C(1) r/w Section 143(3) of the Act on 25.02.2015. On receipt of the draft order, the appellant/ assessee submitted their objections in terms of sub section 2 of Section 144(C), in terms of sub section 5 of Section 144C. The DRP shall, in a case where any objection is received under sub section 2, issue such directions, as it thinks fit, for the guidance of the Assessing Officer to enable them to complete the assessment. 7. In terms of sub section 7, the DRP may, before issuing any directions referred to in sub-section 5 make such further enquiry, as it thinks fit; or cause any further enquiry to be made by any income tax authority and report the result of the same to it. 8. ....
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....ject M/s.Ashnoor Textiles Mills Ltd., holding it as loss making. 3. The Hon'ble DRP erred in holding that the assessee has furnished the details of break-up of employee cost for itself as well as for comparables and directing that appropriate adjustment should be allowed to the assessee. 4. The Hon'ble DRP failed to note that the assessee while calculating the PLI of M/s.Ashnoor Textiles Mills Ltd., has not included other operational expenditure of the industry amounting to Rs. 4.17 crores thereby ending with a positive operating profit, whereas the TPO has included this operational expenditure and arrived at a negative OP/OC at (-) 5.13%" 13. On a perusal of the above grounds, it is seen that the Revenue was ag....
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....t to be calculated in this issue after taking into account all the relevant facts and details." 15. Thus, the order dated 24.11.2015 passed by the DRP is an order reducing the variation proposed in the draft assessment order dated 25.02.2015. Thus, in our considered view, the Tribunal was not right in holding that the DRP exceeded its jurisdiction in passing the order. In any event, the order passed by the DRP was not impugned before the Tribunal rather what was impugned was the assessment order dated 28.12.2015 passed under Section 144C(13) r/w Section 143(3) of the Act. Therefore, the Tribunal was required to consider on merits whether the said assessment order was justified or not. 16. The learned counsel for the Revenue as well as....