TaxTMI 
TaxTMI 
2026 (9) TMI 39
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....onsequently, the order should be quashed, and any adjustments made therein should be deleted in accordance with the relevant provisions of the Act. 2. On the facts and circumstances of the case, the Learned Assessing Officer/Transfer Pricing Officer (Learned TPO) erred in making an adjustment to the tune of INR 9,51,00,800/- even after accepting that payment of the Lead Member Fees is at arm's length basis the agreements submitted by the Appellant & taking into consideration al/ the relevant factors in the order giving effect to the directions of Hon'ble DRP and is therefore a mistake apparent from record. B. Transfer Pricing Grounds - Payment of Lead Member Fee 3. Without prejudice to Ground No. 1 & 2 & on the facts and circumstances of the case, the Learned AO/TPO has erred in rejecting the agreements selected by the Appellant despite the fact that the services availed by the contracting parties in those agreements are also being availed by the Appellant and its AE and that the Appellant had applied Other Method to benchmark its transaction primarily due to the fact that strict comparability of agreements cannot be attained in such a scenario. ....
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.... Act. 12. Without prejudice to the other grounds, that on the facts and in the circumstances of the case, the Learned AO was not justified and erred in law in levying interest u/s 234D amounting to INR 14,35,917/- while computing the total tax payable under the Act. 13. Without prejudice to the other grounds, that on the facts and in the circumstances of the case, the Learned AO has erred in law in not granting interest under section 244A of the Act on the refund determined, which is mandatory and consequential in nature, and the Appellant is entitled to such Interest. O. Other Grounds 14. Without prejudice to the other grounds, that on the facts and circumstances of the case and in law, the learned AO has erred in initiating penalty proceedings u/s. 270A of the Act. Each of the above grounds is independent and without prejudice to the other grounds of appeals preferred by the Appellant. 2. At the time of hearing, ld. AR of the assessee submitted the relevant facts of the case and submitted his submissions as under. He submitted that Express Freight Railway Consortium ('Assessee'/ 'EFRC'/ 'AOP')is a consortium comprising Mitsui& Co. L....
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....re less than the ALP, transaction was justified to be at arm's length. 9. He brought to our notice the findings of TPO's order dated 09.01.2025 and submitted that ld. TPO rejected 3 out of 5 comparables selected by assessee on the ground that they were dissimilar to the present facts and computed the ALP as 0.80% and referred to page 83-85 of appeal set. He submitted that accordingly, upward adjustment of Rs. 9,51,00,800 was made to the income of assessee and referred page 86 of appeal set. 10. Further, he brought to our notice the directions of ld. DRP dated 28.10.2025 relates to selection of comparables and submitted that ld. DRP directed the ld. TPO to re-analyse the comparable agreements while maintaining parity and referred to DRP Directions at page 28-29 of appeal set. 11. He further submitted that additional comparables proposed by the assessee were rejected without assessing their comparability and referred to DRP Directions at page 36 of appeal set. 12. With regard to inclusion of royalty agreements, he submitted that the ld. TPO has failed to consider royalty agreements in its search process with regards to benefits received with regard to brand value of Mitsu....
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....hstanding anything to the contrary contained in section 153 or 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." 16. He submitted that as is manifest from the above provision, notwithstanding anything to the contrary contained in section 153 of the Act, the final assessment shall be completed within one month from the end of the month in which directions issued by the ld. DRP are received by the Assessing Officer. 17. In this light, ld. AR of the assessee submitted that the following dates are relevant to ascertain whether the impugned order dated 24.12.2025 is passed within prescribed timeframe mandated under the Act: Date Particulars 28.10.2025 Date of DRP Directions as mentioned in the DRP directions 28.10.2025 Date of uploading of DRP Directions on ITBA Portal 28.10.2025 Date of DRP Directions as mentioned in TPO's order giving effect (as extracted in final assessment order) 30.11.2025 Due date for AO to pass final assessment order under Section 144C(13) 24.12.2025 Date on which AO passed final assessment....
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....less assessment regime which now holds the field. The uploading of the directive of the DRP on the ITBA portal would thus constitute valid and sufficient service and the period of limitation as prescribed in Section 144C(13) of the Act would be liable to be computed bearing that crucial date in mind. Once the aforesaid position becomes clear, it is evident that the order of assessment, if at all could have been framed lastly by 31 July 2022. There has thus been an abject failure on the part of the first respondent to comply with the mandatory timelines as incorporated in the aforenoted provisions. Accordingly, the writ petition is liable to be allowed and the impugned order of assessment and the consequential penalty proceedings are thus liable to be set aside on this short score alone. 23. The writ petition is allowed. The order of assessment dated 24 August 2022 as well as the penalty show cause notice dated 24 August 2022 are quashed and set aside. For reasons aforenoted and consequent to a failure on the part of the respondents to implement the directives of the DRP, the return as submitted by the petitioner would be deemed to have been accepted and the tax liability w....
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....ction 144C(13) of the Act, assessment had to be completed on or before 31.05.2022. In present case the assessment is completed only on 30.6.2022 i.e., it is time barred null and void. Therefore, impugned assessment order dated 30.06.2022 is set aside being barred by limitation. Other grounds having become academic in nature are left open." 22. He further placed reliance placed on the following decisions:- a. Vodafone Idea Ltd. v. CPC, [2023] 459 ITR 413 (Bom.) (Bombay HC) b. Taeyang Metal India Private v. DCIT, [2024] 160 taxmann.com 536 (Madras) (Madras HC) c. Rapiscan Systems (P.) Ltd. v. ADIT, [2025] 170 taxmann.com 753 (Telangana) (Telangana HC) d. CIT v. Ramco Cements Ltd., [2025] 171 taxmann.com 306 (Madras) (Madras HC) e. PCIT v. Sterling Oil Resources Ltd., [2025] 171 taxmann.com 581 (Bombay) (Bombay HC) f. Jones Lang LaSalle Property Consultants (India) Pvt. Ltd. v. Assessment Unit, ITA No.3964/DEL/2024 (ITAT Delhi) g. BMW India Pvt. Ltd. v. ACIT, ITA No. 2024/Del/2022 (ITAT Delhi) h. Microsoft Corporation (India) Pvt. Ltd v. DCIT, ITA No.1862/Del/2022 (ITAT Delhi) i. Nikon India Private Lt....