2023 (4) TMI 474 - AT - Income Tax

Validity of order u/s 92CA (3) as beyond the prescribed time limit - HELD THAT - In the present case, the learned Transfer Pricing Officer for A.Y. 2011-12 has passed the order u/s 92CA(3) of the Act on 30th January, 2015. Admittedly, in this case, the time limit for passing the order under section 153 was to expire on 31 March 2015. The time limit for passing of the order u/s 92CA (3) of the Act expires before 30 January 2015. Therefore, naturally the order passed by the learned Transfer Pricing Officer is passed beyond the time limit. As respectfully following the decision of Pfizer Healthcare India (P.) Ltd. 2021 (2) TMI 1152 - MADRAS HIGH COURT , we hold that the order passed by the learned Transfer Pricing Officer under Section 92CA (3) of the Act is passed beyond the prescribed time limit. Therefore, such order of TPO is not sustainable. Mere pendency of writ petition before the honourable Supreme Court does not help the case of the revenue. If the order passed by TPO is held to be passed beyond prescribed time limit, the assessee does not remain an ' eligible assessee' as per section 144C(15) (b) a nd hence the extended time of 12 months is also not available ? - Even the regular assessment order passed by AO u/s 143(3) under challenge in this appeal also becomes barred by limitation. This is held by the decision of the co-ordinate bench in ATOS India Pvt. Ltd. 2023 (2) TMI 1112 - ITAT MUMBAI we hold that the assessment order passed by the learned Assessing Officer under Section 143(3) read with section 144C (13) of the Act dated 15th February, 2016 is also not sustainable. Assessee appeal allowed.

Summary

Issues Involved:
1. Validity of the Transfer Pricing Officer's order due to alleged limitation.
2. Consequent validity of the assessment orders under Section 143(3) read with Section 144C(13) of the Income-tax Act, 1961.

Summary:

Issue 1: Validity of the Transfer Pricing Officer's Order Due to Alleged Limitation

The assessee argued that the Transfer Pricing Officer's (TPO) order dated 30 January 2015 was barred by limitation as per Section 92CA(3A) read with Section 153 of the Income-tax Act, 1961. The Tribunal noted that the TPO's order should have been passed before 29 January 2015, making the order dated 30 January 2015 beyond the prescribed time limit. The Tribunal admitted the additional ground raised by the assessee, emphasizing that it is jurisdictional and can be raised at any time. The Tribunal relied on the decision of the Hon'ble Madras High Court in Pfizer Healthcare India (P.) Ltd., holding that the TPO's order was not sustainable due to being passed beyond the time limit.

Issue 2: Consequent Validity of the Assessment Orders

Since the TPO's order was found to be barred by limitation, the assessee did not remain an "eligible assessee" under Section 144C(15)(b) of the Act. Consequently, the extended time limit for passing the assessment order was not available. The Tribunal quashed the assessment orders for the assessment years 2011-12, 2012-13, and 2013-14, as they were also barred by limitation. The Tribunal followed the decisions in Pfizer Healthcare India (P.) Ltd. and ATOS India Pvt. Ltd., concluding that the assessment orders were not sustainable.

Conclusion:

The Tribunal allowed the appeals filed by the assessee for the assessment years 2011-12, 2012-13, and 2013-14, quashing the assessment orders. The appeal filed by the Revenue was dismissed. The Tribunal did not adjudicate on other grounds of appeal due to the quashing of the assessment orders. The order was pronounced in the open court on 11.04.2023.