2021 (5) TMI 856 - AT - Income Tax

Dismissal of appeal of the assessee because the appeals were filed against the Draft Assessment Orders and not against the final assessment order passed pursuant to the Draft Assessment Order - DR argued stating that the assessee is entitled to appeal against the final assessment order passed pursuant to the draft assessment order passed by the TPO and not against the Draft Assessment Order passed by the TPO as per the provisions of the Act - HELD THAT - We do not find any error in the orders of the Ld. CIT(A) because as submitted by the Ld. DR the provisions of section 246A r.w.s. 144C makes it clear that the final assessment order passed by the Ld. AO pursuant to the Draft Assessment Order passed by the TPO U/s. 144C of the Act is only appealable before the Ld. CIT(A) which the Ld. AR could not controvert. Hence, we do not find any infirmity in the orders of the Ld. CIT(A) on the issue and therefore, we hereby sustain the order of the Ld. CIT(A) for both the A.Ys. 2007-08 and 2008-09.

Summary

Issues:
Appeal against draft assessment order, maintainability of appeal, final assessment order appealability.

Analysis:
The appellant filed appeals against the order of the Ld. CIT(A)-10, Hyderabad for the A.Y. 2007-08, challenging the dismissal of the appeal in limini. The grounds raised by the assessee included contentions regarding the erroneous nature of the order, failure to invoke section 92CA, and the demand quantification process. The Ld. CIT(A) dismissed the appeals as not maintainable, citing that they were filed against Draft Assessment Orders, not the final assessment order. The Ld. DR supported this stance, emphasizing that appeals should be made against the final assessment order passed by the Assessing Officer following the draft assessment order. The Ld. AR could not counter these arguments. The tribunal upheld the Ld. CIT(A)'s decision, stating that as per section 246A r.w.s. 144C, appeals can only be made against the final assessment order resulting from the draft assessment order, not against the draft assessment order itself. Consequently, both appeals were dismissed.

This judgment primarily addresses the issue of the maintainability of appeals against draft assessment orders. The tribunal clarified that appeals should be directed towards the final assessment order issued by the Assessing Officer subsequent to the draft assessment order. The provisions of section 246A r.w.s. 144C were highlighted to support this interpretation, emphasizing that the final assessment order is the proper subject of appeal. The decision underscores the procedural requirement of appealing the correct order to ensure compliance with statutory provisions.

The appellant's contentions regarding the nature of the order, invocation of section 92CA, and demand quantification were considered but deemed irrelevant to the issue of appeal maintainability. The tribunal focused on the specific question of whether the appeals were made against the appropriate order in line with statutory provisions. The judgment underscores the importance of adhering to procedural rules and correctly identifying the order subject to appeal to ensure the effective administration of tax laws and dispute resolution mechanisms.

Overall, the judgment provides clarity on the procedural aspect of filing appeals in tax matters, emphasizing the necessity of directing appeals against the final assessment order rather than draft assessment orders. By upholding the decision of the Ld. CIT(A) and dismissing the appeals, the tribunal reaffirmed the importance of procedural compliance in tax dispute resolution processes, ensuring consistency and adherence to statutory requirements.