TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 982
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....led seeking to quash and set aside the impugned Draft Assessment Order dated 8th March 2025 passed under Section 144C and the Final Assessment Order dated 7th April 2025 passed under Section 143 (3) read with Section 144C and Section 144B of the Income Tax Act, 1961 ("for short "I.T. Act"). Consequently, the Demand Notice issued under Section 156 as well as the Show Cause Notice issued for imposing penalty under Section 270A and Section 271AAC are also impugned. 3. The short ground on which all these orders and notices are impugned is that the Assessing Officer has wrongly invoked the provisions of Section 144C which relate to a reference to the Dispute Resolution Panel. According to the Petitioner, in the facts of the present case, init....
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....under Section 144C. According to the Revenue, the Petitioner puts a very restrictive meaning to the words "eligible assessee" when infact a broader meaning has to be given which would include all Assessees where a reference to the TPO is made by the Assessing Officer proposing a variation to the income declared by the Assessee. As the meaning of income includes loss, similar meaning of "variation" would also include "no variation" by the TPO, is the submission of the Revenue. 5. We have heard the learned counsel for the parties at length and we have also perused the papers and proceedings in the above Writ Petition. The short question that falls for consideration in the present Petition is really whether the Petitioner is an "eligible as....
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....pplied) 6. In the facts of the present case, it is not in dispute that the Petitioner is not a non-resident or a foreign company as contemplated under Section 144C (15) (b)(ii). The question is whether the Petitioner would fall within the definition of "eligible assessee" as contemplated under Section 144C (15) (b) (i). On a plain reading of the said provision, the Petitioner can be stated to be an "eligible assessee" only if there is a case of variation referred to in the said sub-section 1 and which arises as a consequence of the order passed by the TPO under sub-section 3 of Section 92CA. In the facts of the present case, it is an admitted position that there was no variation in the income of the Petitioner by virtue of the order of t....
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.... in the present petition is whether the petitioner is an "eligible assessee". 6. Section 144C provides for a detailed procedure to be followed in cases where any variation in income or Loss returned which is prejudicial to the interest of an assessee occurs on account of reference made in section 92CA of the Act. Relevant portion of section 144C is reproduced here-in-below : "144C.Reference to Dispute Resolution Panel.-(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 Oc....
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....vant for our purpose, on account of procedure undertaken in section 92CA of the Act, there was no variation in the income by virtue of order of Transfer Pricing Officer. That being the position, the petitioner cannot be stated to be an eligible assessee as defined in clause (b) of sub-section (15) of section 144C of the Act. Procedure for issuance of draft order calling for his objection and taking further steps as laid down under section 144C therefore, would not apply." (emphasis supplied) 9. The decision of the Hon'ble Gujarat High Court in Pankaj Extrusion (supra) was thereafter also followed by the Hon'ble Delhi High Court in the case of Honda Cars India Ltd v/s Deputy Commissioner of Income-tax [2016] 67 taxmann.com 29 (De....
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....gible assessee" for the purposes of Section 144(C)(15)(b) is a hard and fast definition and can only be applicable in the above two categories. 12. First of all, the petitioner is admittedly not a foreign Company. Secondly, the Transfer Pricing Officer has not proposed any variation to the return filed by the petitioner. The consequence of this is that the Assessing Officer cannot propose an order of assessment that is at variance in the income or loss return. The Transfer Pricing Officer has accepted the return filed by the petitioner. In view of the which, neither of the two conditions are satisfied in the case of the petitioner and thus the petitioner for the purposes of Section 144C(15)(b) is not an "eligible assessee". Since t....