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2023 (5) TMI 797 - AT - Income TaxValidity of assessment u/s 92CA - period of limitation as prescribed u/s 92CA(3A) r.w.s. 153 - HELD THAT - As relying on ATOS INDIA PVT. LTD.case 2023 (2) TMI 1112 - ITAT MUMBAI and M/S. MONDELEZ INDIA FOODS PRIVATE LIMITED 2022 (11) TMI 1339 - ITAT MUMBAI order of the ld. TPO dated 01/11/2019 and draft assessment order dated 27/12/2019 as barred by limitation, thereby resulting in assessee not being an eligible assessee u/s.144C(15)(b)(i) of the Act and consequentially the final assessment order dated 17/04/2021 is also bad in law. Accordingly, the ground of original grounds and additional grounds raised by the assessee are hereby allowed.
Issues Involved: Validity of the Transfer Pricing Order u/s 92CA(3), Eligibility of the Assessee u/s 144C, and Limitation Period for Draft and Final Assessment Orders. Validity of the Transfer Pricing Order u/s 92CA(3): The assessee contended that the Transfer Pricing Order (TPO) dated 01/11/2019 was barred by limitation as per Section 92CA(3A) of the Act, which mandates that the TPO should pass an order 60 days prior to the date on which the period of limitation u/s 153 expires. The Tribunal noted that the period of limitation for the assessment year 2016-17 was 31/12/2019, making the due date for the TPO order 31/10/2019. Since the TPO order was passed on 01/11/2019, it was held to be barred by limitation. The Tribunal relied on the decisions of the Hon'ble Madras High Court in Pfizer Healthcare India (P.) Ltd. vs. JCIR and DCIT vs. Saint Gobain India (P.) Ltd., which confirmed that the TPO order must be passed within the prescribed time frame. Eligibility of the Assessee u/s 144C: The Tribunal held that since the TPO order was barred by limitation, the assessee could not be considered an "eligible assessee" u/s 144C(15)(b)(i) of the Act. Consequently, the extended period provided in Section 153 for making the draft and final assessment orders would not apply. The draft assessment order dated 27/12/2019 and the final assessment order dated 17/04/2021 were also held to be barred by limitation and void ab initio. The Tribunal referred to the decision of the Co-ordinate Bench in Mondelez India Foods Pvt. Ltd. vs. Addl. CIT and Atos India Pvt. Ltd vs. DCIT, which supported this view. Limitation Period for Draft and Final Assessment Orders: The Tribunal concluded that the draft assessment order passed by the AO on 27/12/2019 was barred by limitation because it was based on the invalid TPO order. As a result, the final assessment order dated 17/04/2021, which followed the draft order, was also void ab initio. The Tribunal emphasized that any proceedings emanating from an invalid order are also void. The Tribunal dismissed the arguments of the Revenue, which relied on the decision of the Delhi Tribunal in Louis Dreyfus Commodities India Private Ltd. vs. DCIT, by distinguishing it from the present case. Conclusion: The Tribunal allowed the appeal of the assessee, holding that the TPO order and the subsequent draft and final assessment orders were barred by limitation and void ab initio. Consequently, the other grounds raised by the assessee on the merits of the additions were not addressed.
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