TaxTMI 
TaxTMI 
TaxTMI 
2020 (2) TMI 1277
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....ome was filed declaring total income of Rs. 33,09,92,550/-. The assessee reported certain international transactions. The AO made a reference to the Transfer Pricing Officer (TPO) for determining the arm's length price (ALP) of the international transactions. Pursuant to the order passed by the TPO, the AO passed a draft order dated 21.12.2018 determining total income at Rs. 33.48 crore by making an addition of Rs. 38,77,566/- on account of `Income from fees for technical services'. The draft order was admittedly served on the assessee on 24.12.2018. The assessee filed objections in Form No. 35A before the Dispute Resolution Panel (DRP) on 24.01.2019. The DRP, considering the provisions of section 144C(2), opined that the objections in Form No.35A ought to have filed within 30 days of receipt of the draft order, which was actually delayed by one day. The DRP called upon the assessee to submit as to why the objections be not dismissed at the threshold as not maintainable. The assessee raised certain issues urging the DRP to proceed with the matter after condoning the delay, which bore no fruit. Eventually, the DRP dismissed the assessee's objection in limine as time barred vide it....
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.... one day in raising objections against the draft order. The DRP has canvassed a view that it has no power to condone the delay in as much as such power is absent in section 144C or Income-tax (DRP) Rules, 2009. The DRP fortified its view in dismissing the objections filed by the assessee in limine by mainly relying on the judgment of Hon'ble Bombay High court in CIT Vs. Grasim Industries Ltd. (2009) 319 ITR 154 (Bom) in which the Hon'ble High Court has held that it has no power to condone the delay in filing appeal u/s. 260A of the Income-tax Act. Under these circumstances, the moot question is whether the DRP was justified in not condoning the delay of one day and consequently dismissing the objections raised by the assessee at the entry level without delving into their merits. 6. It is trite that filing of an appeal or an application under any Act is a right provided by the concerned statute. This right carries certain obligations including adhering to the time limit prescribed in the statute for filing of such an appeal or application. In the context of the Income-tax Act, 1961, an appeal can be filed before the CIT(A) within 30 days as prescribed u/s. 249(2) of the Act. In the....
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....ay High Court in CIT Vs. Velingkar Brothers (2007) 289 ITR 382 (Bom.) (FB) observed that sub-section (2) of section 260A does not make section 29(2) of the Limitation Act, 1963 inapplicable and accordingly held that the power to condone delay in filing appeal must be read to be existent. Thereafter, the Hon'ble Supreme Court had an occasion to consider this issue in the context of Excise Act in Commissioner of Central Excise and Customs Vs. Hongo India (P) Ld. and Another (2009) 223 CTR 225 (SC) in which it held that a High Court has no power to condone the delay in filing reference applications beyond the prescribed period. Similar issue once again came up for consideration before the Hon'ble Bombay High Court in CIT Vs. Grasim Industries Ltd. (2009) 319 ITR 154 (Bom.) in which the Revenue sought condonation of delay by relying on the earlier Full Bench judgment of the Hon'ble Bombay High Court in Velangkar Brothers (supra). Considering the later judgment of the Hon'ble Supreme Court in Hongo India (P) Ld. and Another (supra), the Hon'ble Bombay High court held that the earlier view of the Full Bench in Velingkar Brothers (supra) was not a good law in view of the later judgment of....
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.... in the sense of conferring a bridled power of condoning the delay in favour of the competent authority/forum so that the delay may be condoned if it is up to a specific length of time. We have noted above that sub-section (2) obligates an assessee to file objections against the draft order in Form No. 35A within a period of thirty days. Sub-section (12) of section 144C places an embargo of limitation on the DRP not to issue any direction u/s. 144C(5) after nine months from the end of the month in which the draft order is forwarded to the eligible assessee. If we accept the contention of the assessee that the DRP was empowered to condone the delay of one day in filing objections and countenance the same, there may be a case in which such a delay is for one year instead of one day and such a delay may also be on a sufficient cause. The logic is that if delay of one day can be condoned on sufficient cause then there can be no reason for not condoning the delay of one year equally on sufficient cause. If such a hypothetical delay of one year is allowed to be condoned, the DRP will run out of time to issue direction under sub-section (5) within a period of nine months from the end of t....
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....ent on the basis of the draft order within a period of one month from the end of the month in which the acceptance is received. Clause (b) of section 144C(3) deals with a situation of completing the assessment on the basis of the draft order in a case in which no objections are received within the period specified in sub-section (2). In the latter situation, clause (b) of section 144C(4) provides that the AO will pass the assessment order within one month from the end of the month in which the period of filing the objections under sub-section (2), expires. It means that if an assessee does not file objections against the draft order before the DRP within a period of thirty days as per sub-section (2), the AO, without waiting for anything else, will have to complete the assessment within one month from the end of the month in which the period of filing of objections under sub-section (2) expires. The DRP dismissed the objections of the assessee in limine by opining that the assessee could not have filed objections outside the time limit provided under sub-section (2) of section 144C. The net effect of the order of the DRP is that the objections filed by the assessee were time barred....