| The Tax Publishers2023 TaxPub(DT) 7019 (Bom-HC) : (2023) 459 ITR 0413 INCOME TAX ACT, 1961
Section 144C(13)
Since failure on the part of department to follow the procedure under section 144C was not merely a procedural irregularity, but an illegality and vitiated the entire proceeding, assessment order dated 31-8-2023 passed by AO two years after the DRP directions, was time barred therefore, the ROI as filed had to be accepted.
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Assessment - Transfer pricing - AO framed assessment pursuant to DRP directions - Bar of limitation
TPO passed order proposing adjustment to value of the international transaction of assessee. AO issued draft order dated 29-12-2019 under section 144C(1) for the relevant assessment year and proposed various additions/disallowances. Assessee filed objections under section 144C(2)(b) before Dispute Resolution Panel (“DRPâ€) on 27-1-2020. A notice was issued by DRP and assessee responded by filing relevant documents/evidence in support of objections raised by it. Finally, DRP issued directions dated 25-3-2021 under section 144C(5). AO passed assessment order dated 31-8-2023. The grievance of assessee was that AO failed to pass the final order in terms of directions of DRP within 30 days, as prescribed by section 144C(13). Held: Assessment order dated 31-8-2023 passed by AO two years after the DRP directions, was time-barred. Failure on the part of department to follow the procedure under section 144C was not merely a procedural irregularity, but an illegality and vitiated the entire proceeding. Consequently, the ROI as filed had to be accepted.
Relied:Turner International India Private Limited v. Dy. CIT, Circle-25(2), New Delhi 2017 SCC OnLine DEL 8441 : 2017 TaxPub(DT) 1685 (Del-HC).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2016-2017
IN THE BOMBAY HIGH COURT
K. R. SHRIRAM & NEELA GOKHALE, JJ.
Vodafone Idea Ltd. v. Central Processing Centre
Writ Petition (L) No. 15398 of 2023
8 November, 2023
Petitioner by: J. D. Mistri, Senior Advocate a/w Madhur Agrawal i/b Jitendra Singh
Respondents-Revenue by: Devang Vyas, learned Additional Solicitor General a/w Devvrat Singh, Sangeeta Yadav & Jagdish Choudhary
Neela Gokhale, J.
1. Rule. Rule made returnable forthwith. By consent, the petition is taken up for final hearing at the admission stage.
2. Petitioner has called in question the failure of Respondent Nos. 1 & 2 to refund the amount paid by Petitioner for assessment year (AY) 2016-2017, which Petitioner claims to have paid in excess of the legitimate tax due on the returned income of Petitioner and seeks a refund of the said amount along with applicable interest.
3. The case of Petitioner is quite elementary and we are constrained to observe the complete apathy and negligent approach of the assessing officer concerned in discharging his duties, in accordance with the provisions of Income Tax Act, 1961 (the Act). Any dereliction and remissness on the part of officers entrusted with a duty to act within the strict contours of law affects the exchequer and has far reaching consequences on the prosperity and economic stability of the nation. Laxity in this regard has a propensity to destroy and bring to naught any effective system put in place by the Government for efficient and transparent administration of taxation laws and its regulations. Such an adverse effect on the exchequer is revealed in the present case.
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