TaxTMI 
TaxTMI 
2025 (10) TMI 235
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....t to the relief allowed by the ITAT, the assessment order under Section 143(3) of the Income Tax Act, 1961 (for short 'the Act') dated 14.10.2008, was modified by treating the revised income of the petitioner as Rs. 3,97,79,542/-, by deducting a sum of Rs. 3,45,51,636/- towards the relief allowed by the ITAT of Rs. 7,43,31,178/-, as per rectification order dated 13.02.2012, under Section 154 r/w Section 143(3) of the Act. The respondent-ACIT has computed the total tax and interest refundable as Rs. 4,09,49,631/-. 3. Petitioner is a company engaged in software development. It filed its return of income for the subject assessment year on 01.11.2025. The case of the petitioner was referred to a Transfer Pricing Officer (TPO) on 08.05.2006 for determining the Arm's Length Price (ALP) of the international transactions undertaken during the subject year. The TPO vide order dated 31.03.2008, passed under Section 92CA(3) of the Act, determined the ALP of the transactions pertaining to provisions of software services at Rs. 44,11,05,783/- and consequently, computed the adjustment at Rs. 7,07,47,467/- under Section 92CA of the Act. Consequent to the order of the TPO, the respondent-ACIT c....
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....ound No.11 is accordingly allowed for statistical purposes. 18. Ground No.12 does not require any adjudication in view of amendment to Section 92C with reference to variation of 5%. Therefore, the same is rejected. 19. Ground No.13 pertains to levy of interest under Section 234B on additional income arising due to T.P. adjustment. This issue is also required to be re-adjudicated by the TPO depending on the fact whether T.P. adjustments are required or not. A.O/TPO is directed to give an opportunity to the assessee, takes its objections and then consider the issue factually and legally. With these directions, ground No.13 is considered as allowed for statistical purposes. 20. In the result, appeal of the assessee is allowed for statistical purposes." 5. Petitioner submitted letters before the AO/TPO on different dates starting from 06.06.2017 till 13.09.2024 to give effect to the directions of the learned ITAT and release the consequential refund. Petitioner contends that after lapse of ten long years, the respondent-ACIT passed the impugned order dated 26.09.2024, under Section 254 r/w Section 143(3) of the Act for the subject assessment year. 6. Th....
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....ct, which provides for time limit for passing of the order giving effect to the order passed by the ITAT with a direction to decide the issue afresh. 10. Learned counsel for the petitioner submits that the time limit for passing of a fresh assessment order could at best expire within two years from the end of the financial year in which the order under Section 250 or 254 of the Act is received. The respondent ought to have passed the appeal effect orders till 31.03.2017 since the order of the ITAT was passed on 13.06.2014. In this regard, he has relied upon the decision of a Coordinate Bench of this Court in M/s TNS India Private Limited v. Union of India W.P. Nos. 853 & 8528 of 2019 dt.09.10.2023. 11. Learned counsel for the petitioner has apart from that also taken a plea that the petitioner was not accorded a minimum of 30 days' time before passing of the order dated 26.09.2024 in terms of Section 144C(1) of the Act. Eventually, he submits that the impugned order is bad in law on both grounds. Therefore, it may be set aside. 12. Learned counsel for the petitioner submits that, as a consequence, the original return filed by the petitioner for the assessment year 2005-06 ....
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....ons of the learned ITAT. It is further submitted that the AO/TPO vide purported order dated 25.09.2024 made an upward transfer adjustment to the total income of the petitioner pursuant to the directions issued by the learned ITAT, which resulted in refund of Rs. 4.09 crores vide consequential order dated 26.09.2024. Therefore, the ground raised by the petitioner with regard to the upward transfer adjustment does not hold water. It is reiterated that since order dated 25.09.2024, is not an order passed under Section 92CA of the Act, which in turn is followed by the procedure laid down under Section 144C of the Act and having direct bearing on the consequential order passed on 26.09.2024, draft of the same was not provided to the petitioner. 15. Counter-affidavit of the respondent, however, fails to give any specific reply to the issue of limitation raised by the petitioner in passing the impugned order dated 26.09.2024. 16. In this regard, we may usefully refer to the provisions of Section 153 of the Act, which provides for time limit for completion of assessment, reassessment and recomputation. The very provision as regards the time limit to be adhered to by the AO/TPO pursua....
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.... (2A) of Section 153 of the Act, it could have been passed within a period of two years from the end of the financial year in which the order under Section 250 or 254 of the Act was received and that can be till 31.03.2017 counting two years period from the end of the financial year 2014-15. Even as per sub-section (3) of Section 153 of the Act, the timeline for giving effect to the order could be from the end of the financial year in which the order under Section 154 of the Act was received. 19. In the present case, going by the periods prescribed under sub-section (2A) or sub-section (3) of Section 153 of the Act, the impugned order has been passed after ten years of the order of remand by the learned ITAT dated 13.06.2014 i.e., on 26.09.2024. No explanation worth its claim is evident from the stand of the respondent in the counter-affidavit to explain the time lag of ten years in passing the same order when strict timelines are prescribed under Section 153 of the Act to give effect to either passing fresh assessment order/reassessment order or to give effect to the order passed by the ITAT. In such circumstances, the impugned order dated 26.09.2024, being barred by time, cann....