TaxTMI 
TaxTMI 
2023 (6) TMI 623
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....assessing officer in the present case does not meet with the requirement of Section 147 of the Income Tax Act 1961 ? 2. Whether on the facts and circumstances of the case, the Hon'ble Income Tax Appellate Tribunal was correct in holding that the Assessing Officer has no jurisdiction to issue notice under Section 148 of the Act ? 3. Whether on the facts and circumstances of the case, the Hon'ble Income Tax Appellate Tribunal was justified in the quashing the order passed under Section 143(3) r/w Section 147 and 144C of the Act ? 4. Whether on the facts and circumstances of the case, the Hon'ble Income Tax Appellate Tribunal was correct in holding that order of the Transfer Pricing Officer passed on 22/10/2010 is nu....
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.... of the said order of TPO. The reason why respondent took this stand was because respondent's return of income was processed under Section 143(1) of the Act and there was no assessment proceeding pending under Section 143(3) of the Act during which a reference could be made to the TPO under Section 92CA of the Act and hence such a reference to TPO itself was invalid and any order passed by the TPO would be invalid and such an invalid order of the TPO cannot be the reason for re-opening the assessment. Admittedly, no notice under Section 143(2) of the Act had also been issued. The Assessing Officer has in fact admitted that the case was not selected for scrutiny and no notice under Section 143(2) of the Act was issued but in view of the find....
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....section 147(c)(i) of the Income Tax Act, 1961. I have therefore reasons to believe that income of Rs. 12,17,43,370/- has escaped assessment for A.Y. 2007-08, on account of adjustment to International transactions carried out by the assessee. The case satisfies conditions laid down in sections 149(1)(a) and 151(2) of the Income Tax Act, 1961. Issue notice u/s. 148 for A.Y. 2007-08. 5. Before we proceed further we should note that it is judicially well settled that the belief of the Assessing Officer that there has been escapement of income must be based on some material on record. There must be some material on record to enable the Assessing Officer to entertain a belief that certain income chargeable to tax has....
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....pedient to do so, he may refer to the Transfer Pricing Officer the determination of the arm's length price. Section 92CB of the Act relates to the power of the Board to make safe harbour rules. Section 92D of the Act relates to Maintenance and keeping of information and document by persons entering into an international transaction. Section 92E of the Act prescribes that the person entering into international transaction shall furnish a report from a chartered accountant in Form No.3CEB. Section 92F of the Act contains definitions of certain terms which are relevant to compute arm's length price, etc. in terms of sections 92 to 92 F of the Act. 8. The entire scheme and mechanism to compute any income arising from an international transac....
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..... We may also refer to the provisions of section 143(3) of the Act dealing with assessment of income. In terms of clause (ii) of Sub Section 3 of Section 143 of the Act, it is prescribed that the Assessing Officer shall, by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him or refund on any amount due to him on the basis of such assessment. It is only in the course of such assessment of total income, that the Assessing Officer is obligated to compute any income arising from an international transaction of an assessee with associated enterprises, having regard to the arm's length price. 10. The occasion which requires the Assessing Officer to compute income from an int....
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....edings but await the report of the TPO on the value of international transaction before making final assessment. 11. Therefore, we are inclined to uphold the proposition made by Mr. Pardiwalla that an Assessing Officer can make reference to the TPO under Section 92CA of the Act only after selecting the case for scrutiny assessment. The instructions of CBDT is also a pointer to the legislative import that the reference to the TPO for determining the arm's length price in relation to an international transaction is envisaged only in the course of the assessment proceedings, which is the only process known to the Act, whereby the assessment of total income is done. Therefore, in our view the Tribunal was correct to hold that when reference ....