TaxTMI 
TaxTMI 
2025 (7) TMI 434
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....ces of INR 6.96.67,905 to the total income filed the Appellant. Final assessment order is invalid 2. erred in passing the final assessment order dated 18 November 2021 by the Ld. AO u/s Section 143(3) r.w.s 144C(13) r.w.s 144B of the Income-tax Act, 1961 ('the Act") pursuant to the directions passed by the Hon'ble DRP u/s 144C(5) of the Act dated 21 September 2021 beyond the time limit prescribed and thereby making the entire assessment as vold-ab-initio and liable to be quashed. Transfer Pricing Grounds Determination of Arm's Length Price ("ALP") for Provision of engineering support services 2 erred in not accepting the economic analysis conducted by the Appellant in accordance with the provisions of the Act read with Income-tax Rules, 1962 ("the Rules"), and modifying the economic analysis for determination of ALP in connection with the international transaction pertaining to "provision of engineering support services by the Appellant and holding that the international transactions are not at arm's length 3. erred in applying inappropriate search filter and rejecting Accuspeed Engineering Services India Pvt Ltd....
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....pplication of Comparable Uncontrolled Price ("CUP") method by computing interest on receivables using SBI PLR as the base rate for transactions undertaken in foreign currency. Corporate Tax Grounds Disallowance of late payment of employees' contribution to provident fund 12. erred in upholding addition made in respect of Employees' contribution to Provident Fund of Rs. 90,00657/- (out of which Rs 42,04,777 for the month of September 2016 was paid on 17 October 2016 and Rs 47,95,880 for the month of December 2016 was paid on 17 January 2017) without appreciating the fact that these dues were paid before the due date of filing the return of income and hence the same are to be allowed as deduction in the computation of income. 13. should have appreciated that Employees contribution to Provident Fund was made after the statutory due date but within the same Financial Year and hence the same should be allowed as deduction in computation of income. 14. erred in considering the due date for payment of provident fund under The Employees' Provident Fund and Miscellaneous Provisions Act, 1952 (herein after referred to as 'EPF Act&#....
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....ere revised in rectification order passed by the Learned TPO U/s 154/92CA(5)dt. 15.09.2021 vide order no.ITBA/COM/F/17/2021-22/1035593341(1) and the adjustments were rectified to Rs. 11,11,80,266/-). 4. Consequent to the Learned DRP's direction the DCIT TPO 3(2)(1), Delhi, passed giving effect order on 29.10.2021. Accordingly, the arm's length price adjustment of Rs. 11,11,80,266/-proposed u/s 154/92CA(5) of the Act has been revised to Rs. 6,06,67,245/ and in view of these facts final order passed and the income is assessed as under: Total income as per order u/s 143(1) : 14,90,62,720/- Add Adjustment made by the TPO : 6,06,67,245/- Total Income Assessed : 20,97,29,965/- Rounded off : 20,97,29,970/- 5. Heard rival contentions and perused the material available on record. 6. The Ld. AR submitted that the Learned AO erroneously passed the final assessment order dated 18.11.2021 U/s 143(3) r.w.s. 144C(13) of the Act, pursuant to the directions passed by the DRP u/s 144C(5) of the Act, dated 21.09.2021, beyond the prescribed time limit and thereby making the entire assessment as void-ab-initio and liable to be quashed and also submit....
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....se transferred on 25.04.2022 3 DRP order received by JAO 02.05.2022 18.05.2022 4 Final Assessment order passed 30.06.2022 30.06.2022 5 Limitation from April 2022 will end on 31.05.2022 31.05.2022 17. In the context of faceless assessment process time and place of dispatch and receipt of electronic document (in this case DRP order) is required to be ascertained by reference to section 13 of Information Technology Act, 2000 which is the basis prescribed under section 144B of Income Tax Act also (refer section 144 B (6)(v)). Hon'ble Supreme Court in case of GS Chatha Rice Mills [(2021)2SCC 209-J para 85), interpreted this very provision. Applying principles laid down by Hon'ble Supreme Court, only relevant fact necessary for deciding Ground No. 4 in present appeal relating to time barred assessment, is time of uploading by DRP of DRP order onto ITBA portal. Intimation letter to DRP order unambiguously shows 27th April 2022 as date of uploading of DRP order. This fact cannot be disputed. Except this critical and relevant information everything else (like when order is visible to AO, date of uploading some document by DCIT/ACIT circle....
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....d to issue a Writ of Certiorari or any other writ order or direction under Article 226 of the Constitution of India calling for the records of the case leading to and passing of the impugned assessment order (Exhibit I) dated 30th September 2021 under section 143(3) read with section 144C(13) and 144B of the Act for the assessment year 2016-17, Computation of Income (Exhibit 1-1) and the Demand Notice dated 30th September 2021 (Exhibit 1-2) issued under section 156 of the Act and Penalty Notice dated 30th September 2021 (Exhibit I-3) issued under section 274 read with section 270A of the Act and after going through the same and examining the question of legality thereof quash, cancel and set aside the impugned assessment order (Exhibit I) dated 30th September 2021 passed under section 143(3) read with section 144C(13) and 144B of the Act for the assessment year 2016-17, Computation of Income (Exhibit I-1) and the Demand Notice dated 30th September 2021 (Exhibit 1-2) issued under section 156 of the Act and Penalty Notice dated 30th September 2021 (Exhibit 1-3) issued under section 274 read with section 270A of the Act." 11. In support of argument, the Ld. AR also emphasised upon ....
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....nity of hearing to the assessee. This principle of law has been affirmed by the Bombay High Court in the aforenoted paragraphs of Vodafone Idea and in Shell India Markets Private Limited v. Additional Commissioner of Income Tax Officer, National Faceless Assessment Centre & Ors. The relevant paragraph of the decision in Shell India are extracted hereinbelow: "10. Sub-section (13) of section 144C, therefore, is very clear inasmuch as the Assessing Officer shall, upon receipt of the directions issued under sub-section (5), in conformity with the directions, complete the assessment within one month from the end of the month in which such direction is received. Sub-section (13) also provides that the Assessing Officer can complete the assessment without providing any further opportunity of being heard to the assessee. This means that the moment the Assessing Officer receives the directions under sub-section (5), he has to straightaway complete the assessment and he does not even have to hear the assessee. The Assessing Officer shall simply comply with the directions received from the DRP within one month from the end of the month in which such direction is received." ....
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.... We, consequently, find no merit in the instant appeal and the same shall stand dismissed." 10. In support of arguments, the Learned AR also relied upon the judgment passed by the Hon'ble High Court of Delhi in the case of Louis Dreyfus Company India Pvt. Ltd. vs. DCIT (W.P.(C) [2024] 159 taxmann.com 244 (Delhi), wherein observed as under: - "18. In this backdrop, we note that both the judgments of the Bombay High Court in Shell India Markets (P.) Ltd's case (supra) and Vodafone Idea Ltd's case (supro) construe the time lines as provided in Section 1440 to be mandatory in character. In our considered opinion, this interpretation is in accord with the intent behind insertion of that provision and the bare text and spirit of that section. Thus, we accord our approval to the interpretation as set out in the aforenoted decisions of the Bombay High Court. 19. Further, the procedure of assessment as provided under section 144C does not envisage or contemplate the interdiction or involvement of the TPO once a directive has been framed by the DRP. The role of the TPO comes to an end once an order as contemplated under section 92 CA(4) of the Act has come to be ....
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....ld be deemed to have been accepted and the tax liability worked accordingly." 13. For the sake of convenience, we reproduced section 144Cof the Act: "144C (1) The Assessing Officer shall, notwithstanding anything to the contrary contained in this Act, in the first instance, forward a draft of the www/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 which is prejudicial to the interest of such assessee. 2. On receipt of the draft order, the eligible assessee shall, within thirty days of the receipt by him of the draft order a) file his acceptance of the variations to the Assessing Officer, or (b) file his objections, if any, to such variation with- (1) the Dispute Resolution Panel; and (i) the Assessing Officer, (3) The Assessing Officer shall complete the assessment on the basis of the draft order if (a) the assessee intimates to the Assessing Officer the acceptance of the variation; or (b) no objections are received within the period specified in sub-section (2). ....
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....er. (11) No direction under sub-section (5) shall be issued unless an opportunity of being heard is given to the assessee and the Assessing Officer on such directions which are prejudicial to the interest of the assessee or the interest of the revenue, respectively. (12) No direction under sub-section (5) shall be issued after nine months from the end of the month in which the draft order is forwarded to the eligible assessee. (13) Upon receipt of the directions issued under sub-section (5), the Assessing Officer shall, in conformity with the directions, complete, notwithstanding anything to the contrary contained in section 153 30 for section 153B), the assessment without providing any further opportunity of being heard to the assessee, within one month from the end of the month in which such direction is received." 13.1 As per section 144C(13), there is clear mandate that upon receipt of the directions issued u/s 144C(5), the Ld. AO shall supposed to complete the assessment inconformity with the directions of the Learned DRP without providing any further opportunity of being heard to the assessee, within one month from the end of the month in which s....