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2023 (9) TMI 838 - AT - Income TaxValidity of draft assessment order passed u/s 143(3) r.w.s. 144 r.w.s. 144C(1) - reference to DRP - whether the DRP is right in dismissing the objection filed by the assessee which is beyond the period of 30 days as provided u/s.144C(2)(b)(ii)? - HELD THAT - As delayed filing of objections gives rise to the same consequence as of non-filing of the objections. This is because objection filed after 30 days, which is beyond statutory limit, is as good as no Application filed by the assessee. Assessee did not satisfy the conditions as stipulated in sub-section 2(b)(ii) of Section 144C. When there is no objection petition filed by the assessee against the draft assessment order, the AO is required to pass, within further time period of 30 days, a final assessment order under sub-section (4) of section 144C. Here in this case, the final assessment order was passed by the AO on 19.12.2017 and served the same to the assessee on 21.12.2017. Therefore assessee has an option to challenge the final assessment order before the CIT(A) in accordance with law. Therefore no merits in the grounds raised by the assessee. The present appeal filed by the assessee is devoid of merits and against the provisions of section 144C (2)(b)(ii). Therefore the appeal filed by the Assessee is hereby dismissed.
Issues Involved:
1. Whether the Dispute Resolution Panel (DRP) was right in dismissing the objection filed by the assessee beyond the period of 30 days as provided under section 144C(2)(b)(ii) of the Income Tax Act, 1961. Summary: Issue 1: Timeliness of Filing Objections The solitary issue in this appeal is whether the DRP is right in dismissing the objection filed by the assessee which is beyond the period of 30 days as provided under section 144C(2)(b)(ii) of the Act. The assessee, engaged in manufacturing of Fertilizers, Chemicals, and Paints, filed its original Return of Income for Assessment Year 2014-15. During the assessment proceedings, the case was referred to the Transfer Pricing Officer (TPO) for determination of Arm's Length Pricing. The TPO recommended an upward adjustment of Rs. 1,89,74,894/-. Consequently, the Assessing Officer (AO) issued a draft assessment order on 15-11-2017, served on the assessee on 16-11-2017. Issue 2: Filing of Objections Beyond Stipulated Period As per Section 144C(2) of the Act, the assessee is required to file objections within 30 days of receipt of the draft assessment order. The assessee filed its objection before the DRP on 18-12-2017, which was the next working day after the weekend. However, the objection was filed before the AO on 21-12-2017, beyond the stipulated 30-day period. The assessee cited logistical reasons and financial crisis as causes for the delay. Issue 3: DRP's Authority to Condon Delay The DRP dismissed the objection, referencing the Hon'ble ITAT Chennai Bench decision in Allaya Jewel Industries Pvt. Ltd., which stated that the DRP does not have the authority to condone delays in filing objections. The DRP noted that the objection was filed before the AO after the specified period of 30 days, and the AO had already passed the final order within the period specified in section 144C(4). Issue 4: Availability of Appeal Remedy The DRP also observed that since the final assessment order dated 19-12-2017 was already passed and served on the assessee, it was open to the assessee to challenge the same before the Ld. CIT(A) with appropriate condonation of delay. Issue 5: Grounds of Appeal The assessee raised multiple grounds of appeal, including errors by the DRP in not condoning the delay and not considering the merits of the case. Despite repeated notices, the assessee did not appear for the hearing, leading the Tribunal to proceed ex parte. Issue 6: Tribunal's Decision The Tribunal held that the DRP rightly rejected the objection as not maintainable due to the lack of authority to condone the delay. The Tribunal emphasized that delayed filing of objections is equivalent to non-filing, and the AO was correct in passing the final assessment order. The Tribunal concluded that the assessee has the option to challenge the final assessment order before the Ld. CIT(A) and dismissed the appeal as devoid of merits. Conclusion: The appeal filed by the Assessee is hereby dismissed. The order was pronounced in the open court on 15-09-2023.
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