TaxTMI 
TaxTMI 
2022 (11) TMI 1339
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....pearing on behalf of the assessee submitted that at this stage he would be pressing only additional grounds of appeal No.48 and 49 challenging validity of order passed by Transfer Pricing Officer (TPO) dated 30/01/2014 and the assessment order dated 29/01/2015. The Ld.Counsel for the assessee submitted that both these orders are time barred. 4. The ld.Counsel for the assessee submitted that since additional grounds of appeal No.48 & 49 are legal grounds and goes to the root of validity of assessment, therefore, these additional grounds of appeal should be admitted for adjudication on merits. The facts required for adjudication of the additional grounds are already on record. No fresh evidence is required for adjudication of these legal grounds. He further asserted that legal/ jurisdictional issues can be raised at appellate stage even if such issues were not raised before lower authorities. 5. Ms. Vatsalaa Jha representing the Department vehemently opposed admission of additional grounds of appeal. The ld.Departmental Representative submits that this appeal was filed by the assessee in 2015. The assessee has filed additional grounds of appeal challenging validity of assessmen....
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....2014. The draft assessment order was passed on 28/03/2014. The DRP issued directions on 19/12/2014 and the final assessment order was passed on 29/01/2015. 7.2 The ld.Counsel for the assessee submits that as per provisions of section 92CA(3A) of the Act, where reference is made to the TPO, the TPO is required to pass order under section 92CA(3) of the Act at any time before sixty days prior to the date on which the period of limitation referred to in section 153 for making the assessment order expires. The ld.Counsel for the assessee further refers to the provisions of section 153 of the Act as they were applicable to the assessment year 2010-11. The ld.Counsel for the assessee pointed that where reference is made to TPO under section 92CA(1) of the Act, the limitation for passing assessment order shall be three years from the end of assessment year in which the income was first assessable. In the present case, the due date for completion of assessment in accordance with third proviso to section 153(1) of the Act was 31/03/2014. The time limit for passing the order under section 92CA(3A) of the Act is before sixty days prior to the date on which limitation for passing assessment....
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....n draws support from the decision of Hon'ble Madras High Court in the case of Saint Gobain India (P) Ltd.,(supra) to buttress his arguments, that the assessee in the present case is not "eligible assessee"as there is no valid order under section 92CA(3) of the Act in the case of assessee. Therefore, the assessment framed on the basis of non-est order of TPO is unsustainable. The ld.Counsel for the assessee further asserted that the assessment order dated 21/05/2015 is time barred as the limitation of pasing the assessment order got over on 31/03/2014. 8. Per contra, Ms. Vatsala Jha representing the Department vehemently submitted that the order passed by TPO u/s.92CA(3)of the Act is a valid order passed within the period of limitation. The ld. Departmental Representative submits that CBDT vide Circular No.3/2008 dated 12/03/2008 in the Explanatory Notes on the provisions of the Finance Act, 2007 has explained that with a view that TPO gets sufficient time to make the audit of Transfer Pricing and also to provide the Assessing Officer sufficient time to make assessment in the case involving international transactions, the time limit specified in section 153 of the Act has bee....
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....ve to have a glance on the relevant dates. Date Events 30/01/2014 TPO passed order u/s. 92CA of the Act 28/03/2014 A.O Passed draft assessment order 19/12/2014 Directions of the DRP u/s.144C(15) of the Act 29/01/2015 Final assessment order. The contention of the assessee is that the order passed u/s.92CA(3) of the Act is time barred by one day. The period of limitation for passing the order u/s. 92CA(3) of the Act is computed by the assessee as under:- Events Relevant Dates Assessment Year ('AY') 2010-11 End of Assessment Year 31-03-2011 Due date for completion of assessment under Third Proviso to section 153(1) of the Act (i.e. 3 years from the end of AY) 31-03-2014 Time limit for passing the order under section 92CA(3A) of the Act 60 days Less: Date on which limitation expires under section 153 of the Act i.e. 31-03-2014 1 day Less: Remaining days of March 2014 30 days Less: Number of days February 2014 28 days Less: Number of days January 2014 2 days Last date for passing the order under section 92CA(3) of the Act 29-01-2014 Date of passing the transfer-pricing order ('TP order') ....
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....ourt in the case of Pfizer Healthcare India (P) Ltd. vs. JCIT (supra) has explained as to how period of limitation for making the order u/s. 92CA(3) of the Act has to be worked out. The relevant extract of the same is reproduced herein below: "30. Now, coming to the question of how the 60 day period is to be computed, the critical question would be whether the period of 60 days would be computed including the 31st of December or excluding it. Section 153 states that no order of assessment shall be made at any time after the expiry of 21 months from the end of the assessment year in which the income was first assessable. The submission of the revenue is to the effect that limitation expires only on 12 am of 1-1-2020. However, this would mean that an order of assessment can be passed at 12 am on 1-1-2020, whereas, in my view, such an order would be held to be barred by limitation as proceedings for assessment should be completed before 11.59.59 of 31-12-2019. The period of 21 months therefore, expires on 31-12-2019 that must stand excluded since section 92CA(3A) states 'before 60 days prior to the date on which the period of limitation referred to section 153 expires'....
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.... language is clear the intention of the legislature is to be gathered from the language used. While doing so, what has been said in the statute as also what has not been said has to be noted. The construction which requires for its support addition or substitution of words or which results in rejection of words has to be avoided. As stated by the Privy Council in Crawford v. Spooner [(1846) 6 Moore PC 1 : 4 MIA 179] "we cannot aid the legislature's defective phrasing of an Act, we cannot add or mend and, by construction make up deficiencies which are left there". In case of an ordinary word there should be no attempt to substitute or paraphrase of general application. Attention should be confined to what is necessary for deciding the particular case. This principle is too well settled and reference to a few decisions of this Court would suffice. (See : Gwalior Rayons Silk Mfg. (Wvg.) Co. Ltd. v. Custodian of Vested Forests [1990 Supp SCC 785 : AIR 1990 SC 1747] , Union of India v. Deoki Nandan Aggarwal [1992 Supp (1) SCC 323 : 1992 SCC (L&S) 248 : (1992) 19 ATC 219 : AIR 1992 SC 96] , Institute of Chartered Accountants of India v. Price Waterhouse [(1997) 6 SCC 312] and Harbhaj....
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....the period of limitation under section 153 expires. As per 92CA(4), the assessing officer has to pass an order in conformity with the order of the TPO. After receipt of the order from the TPO determining ALP, the assessing officer is to forward a draft assessment order to the assessee, who has an option either to file his acceptance of the variation of the assessment or file his objection to any such variation with the Dispute Resolution Panel and also the Assessing Officer. Sub-section (5) of section 144C of the Act provides that if any objections are raised by the assessee before the Dispute Resolution Panel, the Panel is empowered to issue such direction as it thinks fit for the guidance of the Assessing Officer after considering various details provided in Clauses (A) to (G) thereof. Sub-section (13) of section 144C of the Act provides that upon receipt of directions issued under sub-section (5) of section 144C of the Act, the Assessing Officer shall in conformity with the directions complete the assessment proceedings. It goes without saying that if no objections are filed by the Assessee either before the DRP or the assessing officer to the determination by the TPO, section 9....
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....discernible purpose or object which comprehends the mischief and its remedy to which the enactment is directed. This formulation later received the approval of the Supreme Court and was called the "cardinal principle of construction".' 38. In case of assessments involving transfer pricing, fixing of time limits at various stages sets forth that the object of the provisions is to facilitate faster assessment involving such determination. In the present case, as rightly held by the learned Judge in paragraphs 22 to 29 of the order dated 7-9-2020, the order of the TPO or the failure to pass an order before 60 days will have an impact in the order to be passed by the Assessing Officer, for which an outer time limit has been prescribed under sections 144C and 153 and is hence mandatory. What is also not to be forgotten, considering the scheme of the Act, the inter-relatability and inter-dependency of the provisions to conclude the assessment, is the consequence or the effect that follows, if an order is not passed in time. When an order is passed in time, the procedures under 144C and 92CA(4) are to be followed. When the determination is not in time, it cannot be relied upo....
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....xpression issued to evaluate limitation period as specified in the Act has to be strictly followed. 16. The ld.Counsel for the assessee has further pointed that reference to DRP can only be made by "eligible assessee". The expression "eligible assessee" has been defined in sub-section (15) to section 144C of the Act . The definition of eligible assessee is reproduced herein below: "(b) "eligible assessee" means - (i) Any person in whose case the variation referred to in sub-section(1) arises as a consequence of the order of the Transfer Pricing Officer passed under sub-section (3) of section 92CA; and (ii) (ii) any non-resident not being a company, or any foreign company" A perusal of the above definition would show that eligible assessee mean any person in whose case variation arises as a consequence of the order of the TPO passed u/s. 92CA(3) of the Act. The order has to be a valid order. In the instant case since, the order of TPO was beyond the period of limitation it is not a valid order. Therefore, there is no "eligible assessee" in terms of the definition provided in sub-section (15) to section 144C of the Act . If there is no eligible assess....
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....the legal paper book filed by the assessee. 21. The ld.Departmental Representative vehemently opposed the admission of additional grounds of appeal at belated stage. The ld.Departmental Representative submits that the assessee had filed the appeal in 2015 and now the assessee has raised additional grounds of appeal challenging the validity of assessment order and the order passed by TPO after six years of filing of appeal. On merits the ld.Departmental Representative reiterated the submissions as were made in the case of Mondelez India Foods Private Limited (supra). 22. The assessee vide application dated 28/06/2021 has inter-alia, raised following two grounds of appeal : "40.1 On the facts and in the circumstances of the case and in law, the assessment order dated 27 February 2015 passed by the learned AO under section 143(3) r.w.s. 144C of the Act is void and bad in law since it was barred by limitation as per provisions of Section 153 of the Act as the provisions of section 144C of the Act are not applicable for the relevant assessment year. 40.2 In view of the above, it is prayed that the assessment order passed by the learned AO be held to be void ab-in....