TaxTMI 
TaxTMI 
2025 (3) TMI 1856
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....2021 3) Referred to TPO u/s 92CA of the Act========== 4) Date of TPO order u/s 92CA(3) of the Act dated 31/03/2023 5) Draft Assessment Order dated 22/09/2023 6) Objections raised before the DRP dated 20/10/2023 7) DRP order dated 25/06/2024 8) Order giving effect by the TPO dated 08/07/2024 9) Final Assessment order dated 27/06/2024 4. In the draft assessment order, the AO made adjustments to the tune of Rs. 36,07,57,661/- whereas the TPO adjustment were restricted by the DRP in the order giving effect to the tune of Rs.34,71,20,569/- only. Thus, it is transpired that some relief was given by the ld. DRP in his order dated 25/06/2024. The relief given by the ld. DRP can be observed from the details given below: "12.1.10 Threeslxty Logica Testing Services Pvt. Ltd. ● Fails the RPT filter of the TPO ● Functionally Dissimilar ● Presence of Intangibles ● Lack of segmental Information Having pursued the annual report, it is noted that this entity ails the related party revenue to total revenue filter as applied by the TPO. computation of RPT dat....
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....d the adjustment made by the TPO in the order dated 31/03/2023. This fact can also be captured from the final assessment order, which is reproduced as under: "5.4 Addition on account of adjustment proposed by T.P Unit Large Value international transactions in services including transactions u/s 92B(2) in comparison to revenue from sale of services shown in lTR and low profitability (T.P Risk Parameter). Decision of Transfer Pricing- The Transfer Pricing order passed u/s 92CA(3) of the I.T. Act. 1961 dated 31.03.2023 in which an adjustment in the case has been proposed by the T.P unit amounting to Rs. 36,07,57,661/- on account of software development segment of the taxpayer international transactions. Inference of A.O - The A.O vide draft order u/s 144C(1) of the Act was passed on 22.09.2023 agreed with the adjustment proposed by the T.P unit and keeping in view the additions proposed in the T.P order dated 31.03.2023 an addition amounting to Rs. 36,07,57,661/- was proposed in the case on account of adjustment u/s 92CA of the Act. Thereafter, the assessee vide response dated 20.10.2023 has communicated the Faceless unit that the assessee has raise....
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.... " 9. We have considered the rival submissions. We find that on identical facts, this Tribunal in the case of Software Paradigms Infotech (P.) Ltd. (supra) has quashed the final order of assessment observing as follows:- "3.3.1 We have heard the rival contention of both parties in the matter and perused and carefully considered the material on record. The undisputed facts on record, as brought out by the discussions above, is that the A0, as per law, was required to pass the final order of assessment dated 17/1/2014 for asst. year 2009-10 u/s 143(3) r.w.s 144C of the Act in conformity with the directions issued by the DRP u/s 144C(5) of the Act, which are binding on him as per section 144C(10) thereof and within the time prescribed u/s 144C(13) of the Act. We find that instead of passing the final order of assessment as required by law, the AO passed the impugned final order of assessment dated 17/1/2014 u/s 143(3) r.w.s 92CA of the Act; which, as contended by the id AR, is identical to the draft order of assessment passed on 14/3/2013 by only incorporating this TPO's proposals and, thereby evidently giving the DRP's mandatory directions issued u/s 144C(5) of th....
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....yed for setting as the final order of assessment of AO to pass orders in accordance with the directions of the DRP. Thus, it is a case of concession by the Assessee and not on the basis of arguments advanced by the parties.) The law is well settled that a decision on concession of the counsel cannot be regarded as a precedent. Therefore, the decision cited by the learned DR does not support the case of the revenue. 11. In view of the conclusion that the assessment order is null and void, the other grounds of appeal raised by the assessee on merits of the addition made do not require any adjudication. 12. In the result, the appeal of the assessee is allowed." In the present case also, as pointed out by the AR, the DRP included Evoke Technologies Limited in the list of comparables and similarly the DRP excluded ICRA Techno Analytics Limited from the list of comparables. The ALP adjustment made by the TPO has been changed on account of these two directions of DRP, however, the Assessing Officer retained the original Transfer Pricing Adjustment at Rs.8,67,23,600 in the final assessment order as made in the draft assessment order. Being so, we are not in a pos....
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....the impugned order passed by the ITAT." 12. In view of the above we hold that the final assessment framed by the AO in contravention to the direction of the ld. DRP is not sustainable. 13. Before parting, it is also pertinent to note that the ld. DRP has given direction dated 25/06/2024 and the AO has framed the final assessment order dated 27/06/2024, whereas the TPO has passed order giving effect to the direction of the ld. DRP dated 08/07/2024. Thus, it is transpired that the final assessment order has been framed by the AO without awaiting for the order to be passed by the TPO in pursuance to the direction of the ld. DRP. Accordingly, a question stroke to our mind whether there was second assessment order passed by the AO after passing of the order giving effect by the TPO dated 08/07/2024. But nothing has been brought to our notice at the time of hearing. This question has been answered against the revenue by this Tribunal in the case of Toyota Tsusho India Private Limited in ITA No.175/Bang/2022 the relevant extract is reproduced as under: "7. During the course of hearing the id. AR drew our attention to the following directions of the DRP:- "5.1.1 M/s....