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TMI Blog2022 (2) TMI 1419X X X X Extracts X X X X X X X X Extracts X X X X ..... to be non-est, the ld. CIT could not have assumed jurisdiction u/s 263 of the Act over a non assessment order which can never be erroneous and prejudicial to the interest of the Revenue. Thus this Tribunal held the impugned assessment order as nonest. Sublato Fundamento Cadit Opus, meaning thereby, that in case the foundation is removed, the super structure falls. - Shri N.K. Billaiya, Accountant Member, And Ms. Astha Chandra, Judicial Member For the Assessee : Shri Ajay Vohra, Sr. Adv. Shri Ankul Goyal, Adv. For the Department : Ms. Anupama Anand, CIT-DR. ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER:- The above captioned nine appeals by the assessee are preferred against the separate orders framed under section 147 r.w.s 143(3) 144C(13) r.w.s of the Income-tax Act, 1961 [hereinafter referred to as 'The Act'] pertaining to Assessment Years 2004-05 to 2010-11, 2013-14 and 2014-15 2. Since the underlying facts in issues are common in all these nine appeals, they were heard together and are disposed of by this common order for the sake of convenience and brevity. 3. The common grievance challenging the impugned orders relate to: i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court and when the matter is remanded back to ITAT for adjudication on limited purpose this issue has been raised which is contrary to the spirit of law and jurisprudence. 2. That Hon'ble Delhi High Court in its order dated 14.02.2020 in ITA No. 960, 1002, 1003, 1004, 1005, 1006, 1008, 1009, 1010/DEL/2019 categorically directs in Para 2 at Page 3 of said order that the case is remanded back to ITA I for limited purpose of adjudication. The relevant extract is reproduced below: We set aside the impugned order in so far as the operative direction contained in paragraph 88 is concerned. We, however, make it clear that the tribunal shall limit its consideration to the aforesaid aspects, since the aspects of issuance of notice u/s 147/148 stands concluded against the assessee. The questions of law framed in the appeal before Hon'ble High court, were as follows: A. Whether the IT AT was correct in law in exercising the power of remand to DRP on the facts and circumstances of the present case? B. Whether being the final fact finding authority, the ITAT abdicated its duty to give findings on merits of the appeal? C. Whether in the facts and c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessment years 2009-10 and 2010-11 (subject assessment years), since the Respondent- Assessee had undertaken international transaction with its Associated Enterprises (AEs), the AO referred the matter to the Transfer Pricing Officer (TPO) for determination of the Arm's Length Price (ALP) of the international transaction entered into by the Respondent-Assessee with its AE; (Hi) the TPO determined upward adjustment of Rs. 56,30,78,638/-; (iv) the Respondent-Assessee approached Dispute Resolution Panel (DRP). which declined to interfere with the transfer pricing adjustment made by the AO; (v) the Respondent- Assessee thereafter approached the ITAT and the ITAT gave part relief to the Respondent-Assessee; (vz) both, the Respondent-Assessee as well as the Appellant-Revenue approached this Court by way of ITA No. 638/Del 2015 and ITA No. 614/Del/2015 respectively; (vii) this Court, vide order dated 28th January, 2016 restored the matter to the ITAT, with certain directions; and, (viii) the Respondent-Assessee, in said second round before the ITAT. made an application under Rule 11 of the ITAT Rules, 1963, seeking admission of the additional ground of appeal i.e. that the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Punjab Haryana High Court), (e) CIT v. Harjinder Kaur [2009] 180 Taxman 23/310 ITR 71 (Punj. Har.) and (/) Sri Nath Suresh Chand Ram Naresh v. CIT [2005] 145 Taxman 1 56 [2006] 280 ITR 396 (All), it had been held that such a defect cannot be treated as a procedural one and once it is found that the assessment is framed in the name of a non-existent entity, it does not remain a procedural irregularity of the nature which could be cured by invoking the provisions of section 292B of the Income-tax Act, 1961 (the Act); and, (xz) thus the assessment orders framed by the AO on a non-existent company w ere a nullity in the eyes of law and void and the provisions of section 292B could not rescue the appellant department. 5. The ld. Counsel for the Appellant Revenue urged two substantial questions for our consideration. Firstly, it was contended that ITAT erred in allowing the additional ground to be urged by the Respondent-assessee. it was argued that the remand by this Court, vide order dated 28th January, 2016 in ITA No. 638/Del/2015, filed by the Respondent-Assessee, and ITA No. 614/Del/2015, filed by the appellant revenue, to the ITAT, was a limited remand and ITAT did not h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of the parties. In this background, in our view, there was no purpose of remanding the matter back to the DRP on a small aspect, namely whether the appellant had made any concession with regard to the existence of its PE in the India. The same was a matter of record, if at all. The Tribunal could have decided the said issue and all other issues arising from answer to the said issue, or in consequences thereof. We, therefore, answer the question framed in favour of the appellant. We set aside the impugned order in so far as the operative direction contained in paragraph 88 is concerned. We, however, make it clear that the Tribunal shall limit its consideration to the aforesaid aspects, since the aspect of issuance of notice under Section 147/148 stands concluded against the assessee. 9. On finding parity of facts, the additional ground is admitted. 10. This Tribunal in ITA Nos. 646 to 653/DEL/2021 for Assessment Years 2004-05 to 2006-07, 2008-09, 2010-11 and 2013-14 and 2014-15, vide order dated 17.11.2021, has held the impugned assessment orders as non-est. The relevant findings read as under: 6. Referring to the appellate proceedings before the DRP for Assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing Officer should have followed the directions of the DRP but instead reduced the attribution of salary to 25%. 10. In the captioned Assessment Years, the Assessing Officer completed assessment on the basis of attribution done in Assessment Year 2007-08. The ld. CIT was of the opinion that the Assessing Officer has wrongly interpreted the directions of the DRP s order of Assessment Year 2007-08 to pass final order and accordingly, came to the conclusion that the assessment orders passed u/s 143(3) of the Act for Assessment Years 2004-05 to 2006-07, 2008-09 to 2010-11 and 2013-14 and 2014-15 are not only erroneous but also prejudicial to the interest of the Revenue and set aside all the assessment orders on the issue of attribution of income to Indian operation. 11. After addressing to the impugned issues, the Tribunal, following the judgment of the Hon'ble High Court of Delhi in the case of PCIT Vs Head Strong Services 125 Taxmann.com 362 held as under: 16. From the above observations of the Hon'ble High Court of Delhi, it is clear that it is mandatory to follow the directions of the DRP by the Assessing Officer failing which the assessment order would ..... X X X X Extracts X X X X X X X X Extracts X X X X
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