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TMI Blog2023 (8) TMI 629X X X X Extracts X X X X X X X X Extracts X X X X ..... scrutiny as the assessee had entered into international transaction with its associated enterprise for the years under consideration. 2.1 A reference was made to the Ld. TPO on 15.03.2013 for A.Y. 2010-11 and 22.03.2014 for A.Y. 2011-12. The dates of reference has been recorded in the draft assessment order dated 13.03.2014 for A.Y. 2010-11 and in the draft assessment order dated 24.02.2015, for A.Y. 2011-12. The Ld. TPO thereafter proposed certain adjustments and passed the orders u/s. 92CA on 30.01.2014 for A.Y. 2010-11 and 30.01.2015 for A.Y. 2011- 12. On receipt of the transfer pricing orders, the Ld. AO passed the draft assessment order on 13.03.2014 proposing certain corporate tax addition along with the transfer pricing addition for A.Y. 2010-11 and 24.02.2015 for A.Y. 2011-12. 2.2 Against the draft assessment order, the assessee filed objections before the DRP and the DRP passed the directions on 29.12.2014 for A.Y. 2010-11 and 30.11.2015 for A.Y. 2011-12. On receipt of the DRP directions, the Ld.AO passed the final assessment order on 27.02.2015 for A.Y. 2010-11 and 30.12.2015 for A.Y. 2011-12. 2.3 Against the above final assessment orders passed for the years under co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in accordance with law. 7. Since we have remitted the issue raised in the additional ground to the files of the DRP, which will go to the root of the matter, we are refrained from adjudicating the grounds raised in the assessee's appeals. 8. In view of the above, the cross objection filed by the assessee and the Department's appeals have become infructuous and are dismissed as such. 9. In the result, the appeals filed by the assessee are allowed for statistical purposes and the appeals filed by the Revenue and the cross objections filed by the assessee are dismissed." 2.4. On receipt of the order passed by this Tribunal, the DRP passed an order giving effect to u/s. 144C(5) r.w.s. 254 of the act for both the years under consideration on 31.10.2022 by way of separate orders. The DRP on the legal issue that was remanded by this Tribunal observed and held as under: 2.5 It is submitted that similar is the observation of the DRP for A.Y. 2011-12. The Ld.AO passed the impugned orders against the DRP directions on 24.11.2022 by way of separate orders for both the years under consideration. 3. Against this order, assessee is once again in appeal before this Tribunal. 3.1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 2799, 3488/Mum/2016, 1977/Mum/2017 & 75/Mum/2018 3.3. On the contrary, the Ld.CIT.DR vehemently submitted that order dated 30.01.2014 and 30.01.2015 passed by the Ld.TPO is a valid order and has been passed within the period of limitation. She submitted that, the DRP observation in para 2.8 has to be met with, for computing the number of days to be excluded for calculating the prior to 60 days. It is her contention that, either the date of the order or the time barring date can be excluded and not both the dates, as the legislature uses the word "prior to". The Ld. CIT.DR has filed the following submissions in support of her contention dated 23.03.2023 and 07.06.2023. Similar is the submissions for A.Y. 2011-12 filed by the Ld. CIT. DR. 4. We have perused the submissions advanced by both sides in the light of records placed before us. The relevant extract of the provisions u/s. 153(1) and section 92CA(3A) is necessary to be considered for adjudicating this issue before us. For the sake of ready reference, the same is reproduced as under: Reference to Transfer Pricing Officer. 92CA. (1) Where any person, being the assessee, has entered into an international transaction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessable. Provided further that in respect of an order of assessment relating to the assessment year commencing on or after the 1st day of April 2019, the provisions of this sub-section shall have effect, as if for the words "twenty- one months, the words "eighteen months" had been substituted. ................ ................ Provided further that where the period available to the Transfer Pricing Officer is extended to sixty days in accordance with the proviso to sub-section (3A) of section 92CA and the period of limitation available to the Assessing Officer for making an order of assessment, reassessment or recomputation, as the case may be, is less than sixty days, such remaining period shall be extended to sixty days and the aforesaid period of limitation shall be deemed to be extended accordingly." 4.1. Chapter-X contains the provisions relating to the computation of income from international transactions having regard to the ALP was inserted by the Finance Act, 2001 w.e.f. 1.4.2002. On such insertion, it became incumbent upon the Ld.TPO to determine the ALP of the international transactions. For the A.Y. 2002-03, the time limit for completion of assessment, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een so often decided as to have become an axiom that in such cases such expressions may have to say the least a compulsory force." 4.4. Therefore despite the use of the word 'may', in section 92CA (3A), the time limit for passing the order by the Ld. TPO is mandatory. We thus hold that the use of the word 'may' in sub- section (3A) of section 92CA is to be construed as 'shall', thereby making this time limit as mandatory and not directory. As such, it is held that, the Ld. TPO is bound by the time limit for passing of his order. 4.5. Now coming to the phrase, "before sixty days prior to the date", in section 92CA(3A) of the Act. We note that, Hon'ble Madras High Court in case of Pfizer Healthcare India(pvt.) Ltd., vs. JCIT(supra) interpreted as under: 30. Now, coming to the question of how the 60 day period is to be computed, the critical question would be whether the period of 60 days would be computed including the 31st of December or excluding it. Section 153 states that no order of assessment shall be made at any time after the expiry of 21 months from the end of the assessment year in which the income was first assessable. The submission of the rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntext in which it is used. It is said that every statute is an edict of the legislature. The elementary principle of interpreting any word while considering a statute is to gather the mens or sententia legis of the legislature. Where the words are clear and there is no obscurity, and there is no ambiguity and the intention of the legislature is clearly conveyed, there is no scope for the court to take upon itself the task of amending or alternating (sic altering) the statutory provisions. Wherever the language is clear the intention of the legislature is to be gathered from the language used. While doing so, what has been said in the statute as also what has not been said has to be noted. The construction which requires for its support addition or substitution of words or which results in rejection of words has to be avoided. As stated by the Privy Council in Crawford v. Spooner [(1846) 6 Moore PC 1 : 4 MIA 179] "we cannot aid the legislature's defective phrasing of an Act, we cannot add or mend and, by construction make up deficiencies which are left there". In case of an ordinary word there should be no attempt to substitute or paraphrase of general application. Attention sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t us now examine the relevant procedures relating to Transfer Pricing. After an international transaction is noticed subject to satisfaction of section 92B, a reference is made to the TPO under sub-section (1) of section 92CA of the Act. The TPO after considering the documents submitted by the assessee is to pass an order under section 92CA (3) of the Act. As per section 92CA(3A), the order has to be passed before the expiry of 60 days prior to the date on which the period of limitation under section 153 expires. As per 92CA(4), the assessing officer has to pass an order in conformity with the order of the TPO. After receipt of the order from the TPO determining ALP, the assessing officer is to forward a draft assessment order to the assessee, who has an option either to file his acceptance of the variation of the assessment or file his objection to any such variation with the Dispute Resolution Panel and also the Assessing Officer. Sub-section (5) of section 144C of the Act provides that if any objections are raised by the assessee before the Dispute Resolution Panel, the Panel is empowered to issue such direction as it thinks fit for the guidance of the Assessing Officer after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of "meaning" i.e. what the words mean and in another aspect, it conveys the concept of "purpose and object" or the "reason and spirit" pervading through the statute. The process of construction, therefore, combines both literal and purposive approaches. In other words the legislative intention i.e. the true or legal meaning of an enactment is derived by considering the meaning of the words used in the enactment in the light of any discernible purpose or object which comprehends the mischief and its remedy to which the enactment is directed. This formulation later received the approval of the Supreme Court and was called the "cardinal principle of construction".' 38. In case of assessments involving transfer pricing, fixing of time limits at various stages sets forth that the object of the provisions is to facilitate faster assessment involving such determination. In the present case, as rightly held by the learned Judge in paragraphs 22 to 29 of the order dated 7-9-2020, the order of the TPO or the failure to pass an order before 60 days will have an impact in the order to be passed by the Assessing Officer, for which an outer time limit has been prescribed under sections ..... X X X X Extracts X X X X X X X X Extracts X X X X
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