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TMI Blog2024 (2) TMI 391X X X X Extracts X X X X X X X X Extracts X X X X ..... sans jurisdiction. Even the provisions of section 292B of the Act cannot confer and validate the jurisdiction on the Assessing Officer, which is otherwise non-existing. Hence passing of the draft assessment order as prescribed under section 144C(1) of the Act is mandatory. Question no. 1 is answered accordingly. Estoppel from challenging the assessment order which was passed on the basis of the admission by the Assessee itself - Whether on the waiver/admission/undertaking of the Assessee for not challenging the draft order before the Ld.DRP u/s 144C of the Act, the AO is competent to pass the assessment order under section 92CA(4) of the Act without passing a draft assessment order as prescribed u/s 144C? - HELD THAT:- It clear that there cannot be any estoppel on the issue of law pertaining to jurisdiction and order passed without jurisdiction, the same can be raised at any time and the principle of estoppel will not apply. Waiver of any legal right can not entail passing the order otherwise than the mandate of law. Passing of the proposed order of assessment u/s 144(C)(1) of the Act is sine qua non before passing of the assessment order and consent of parties cannot confer j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nue, against the order dated 01/07/2022 impugned herein passed by the Ld. Commissioner of Income Tax (Appeelas-58, Mumbai ( in short Ld. Commissioner‟ ) under section 250 of the Income-tax Act, 1961 (in short, the Act‟) for the A.Y. 2011-12. 2. Both the appeals emanates from same impugned order, therefore, for the sake of brevity, the same were heard together and are being disposed of by this composite order. 3. The Assessee in ITA No.2073/Mum/2022 has raised the additional grounds of appeal, which are legal in nature, therefore, we are inclined to decide ITA NO.2073/Mum/2022 as a lead. 4. In the instant case, the Assessee during the relevant assessment year has entered into some international transactions and, therefore, the case of the Assessee was referred by the ITO 7(3)(2), Mumbai on 19/07/2013 to the TPO / Addl. Commissioner of Income-tax, Transfer Pricing 4(3), Mumbai for the computation of arm s length price (in short ALP‟) in relation to the international transactions as detailed in audit report in Form No. 3CEB. 5. The Ld. TPO by perusing the financials of the Assessee observed that the Assessee company is engaged in the business of tradi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessee by sustaining the addition to the tune of Rs. 36,15,481/- and Rs. 3,63,846/- on account of sale margin qua Vapi TT and Vapi Rugs and interest on loan given; however, deleted the other remaining additions, including the disallowance of Rs. 6,17,03,974/- made on account of disallowance u/s 14A of the Act. 10. Being aggrieved, the Assessee and the Revenue filed their respective appeals. The Assessee, during the pendency of appellate proceedings before us, filed additional grounds of appeal which are reproduced herein below:- l(a) On the facts and circumstances of the case and in law, the impugned final assessment order dated 13-3-2015 passed by the Id. AC) is bad in law in as much as the said order suffers from a jurisdictional error as the mandatory procedure stipulated in section 144C(1) of the Income-tax Act, 1961 ('Act') has not been followed by the Id. AC); thereby, rendering the final assessment order illegal, invalid and without authority of law. l(b) The Id. AO failed to first pass a draft assessment order u/s. 144C(1) of the Act and forward a copy thereof to the Appellant, and instead, has directly passed the impugned final assessment order d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the peculiar facts and circumstances of the case and observe that jurisdictional High Court in the case of SHL India Pvt. Ltd vs DCIT (2021) 128 taxmann.com 426(Bom) has also dealt with the identical issue and ultimately held as under: That the Assessing Officer has no power under the statute, as the provision of section 92CA(3) of the Act clearly mandates that the Assessing Officer to pass and furnish a draft assessment order in the first instance. The legislature in our view, has intended to give an important opportunity to the petitioner, who is an eligible Assessee, which, in our view, has been taken away. Failure to follow the procedure under section 144C(1) of the Act, would be a jurisdictional error and not merely procedural error or mere irregularity. This is not an issue which involves a mistake in the said order, but it involves power of the Assessing Officer to pass the order by following the procedure laid down in section 144C(1) of the Act to pass and furnish a draft assessment order to petitioner and directly passing a final assessment order and without giving petitioner an opportunity to raise objection before the DRP, there is a complete contravention of sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the first instance and therefore failure to follow the procedure as prescribed under section 144C(1) of the Act, would be a jurisdictional error and not merely procedural error or irregularity. Straight way passing a final assessment order u/s 92CA(4) amounts to complete contravention of the provisions of section 144C of the Act is an incurable illegality. Such order would be illegal and without jurisdiction and entail the final assessment order as void ab-initio sans jurisdiction. Even the provisions of section 292B of the Act cannot confer and validate the jurisdiction on the Assessing Officer, which is otherwise non-existing. Hence passing of the draft assessment order as prescribed under section 144C(1) of the Act is mandatory. Question no. 1 is answered accordingly. 13. Coming to questions no 2 and 3 , we observe that the Hon ble jurisdictional High Court in the case of Principal Commissioner of Income-tax-15 Vs Lion Bridge technology Pvt. Ltd (2018) 100 taxmann.com 413 (Bom) has also dealt with the identical issue wherein the Assessee has accepted that it does not wish to challenge the passing of the draft assessment order, the Hon ble Court has clearly laid down tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... escribed u/s 144C(1) of the Act. Hence the questions no. 2 and 3 are answered accordingly. 14. Coming to the instant case, as we have observed above that the Assessee has categorically admitted before the Assessing Officer that it does not want to challenge the draft assessment order before the Ld. DRP under section 144C of the Act , and therefore the AO on such waiver/admission/undertaking of the Assessee, passed the final assessment order u/s 143(3) rws 92CA(4) of the Act directly and thus at this stage can not be allowed to make u turn as it is settled law that construction which permits one to take advantage of one s own wrong or impair one s own objections under the statue should be disregarded. Maxim Nullus commodum capere potest de injuria sua propria has a clear mandate of law that, a person who by manipulation of a process, frustrates the legal rights of others, should not be permitted to take advantage of his wrong or manipulations. Even otherwise, at this stage, if allow the claim of the Assessee, then it amounts to allow Unjust enrichment . Nonetheless whatsoever it may be, as it is mandate of law and also well settled by Hon ble High Court that as per the provis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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