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TMI Blog2024 (12) TMI 973X X X X Extracts X X X X X X X X Extracts X X X X ..... AO which is impermissible under the statute. Consequently, the final assessment order passed in pursuance of such irregular direction also rendered irregular. GE India Technologies Pvt. Ltd. Vs DRP [ 2011 (7) TMI 511 - KARNATAKA HIGH COURT] the Hon ble Karnataka High Court has categorically held that, the DRP do not have any power to look beyond the variation/adjustment proposed by the Ld. TPO. Therefore, it was duty bound to dispose-off the objections raised before it by the assessee strictly in terms of provisions of s/s (8) of section 144C of the Act without triggering any further enquiry or verification as the case may. We deem it fit to fist set aside the impugned direction of the Ld. DRP and then impugned consequential assessment orders passed in pursuance of such direction and restore these twin matters to Ld. DRP back to the stage of filing of objections for considering them in the light of evidences and pass an appropriate order giving clear direction either confirming or reducing or enhancing or deleting the variations/adjustment made by the Ld. TPO. - HON BLE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER For the Assessee: Mr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd adjustment before dispute resolution panel [in short DRP ]. 3.3 The Ld. TPO s action of rejecting the method applied by the assessee was held unjustified by the Ld. DRP and thus directed the Ld. AO to determine the ALP either on the basis of certificate from the chartered engineer / cost accountants or in its absence to compute the one by applying CPM method after taking into consideration the capacity utilization indirect cost allocation/apportionment etc. In the absence of certificate, the Ld. AO passed the final assessment after computing the ALP in line with the direction. 4. In IT(TP)A 142/LKW/2022; except the figures for former AY, all other facts are verbatimly alike, hence the reiteration thereof is dispensed with. 5. Aggrieved by the aforestated DRP directions for both the assessment years, the appellant assessee came in separate appeals on following common grounds; 1.a. The Hon'ble DRP has erred in law and on facts to direct the authorities below to verify the utilised capacity and apportionment of indirect cost, while the total cost of steam was already verified by the learned TPO and not been controverted by him in the original order under appeal before the DRP a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pute over ALP determination irrefutably either by confirming or deleting or by reducing or enhancing the variation/adjustment proposed by the Ld. TPO and communicated through draft order by the Ld. AO. The s/s (8) of section 144C of the Act seemingly puts an embargo on the power of Ld. DRP in setting aside the proposed variation/adjustment or issue any direction for conducting further enquiries in passing of final assessment order. The orders passed by the Ld. DRP directing the Ld. AO to sheerly recompute the ALP on either-or basis has suffered from the compliance of s/s (8) of section 144C of the Act. For the reasons, the impugned direction rendered non-est in the laws of law, therefore no appeal thereagainst can lie before the Tribunal. Without prejudice the former prayer, the Ld. DR pressed into service rule 28 of ITAT-Rules 1963 and vehemently submitted that, the matter in the larger interest of justice may qualify for remand to the authority from whose order the appeal has been preferred but, in no case the matter can travel back to the Ld. AO, as he is powerless to determine. 8. We have heard the common contentions arguments of both the rival parties on former limited issue; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to Assessing Officer i.e., to set aside any proposed variation/adjustment or issue any direction to carry out any further enquiry by tax authorities below and decide thereon while passing of final assessment order. 11. The Latin maxim delegatus-non-potest-delegare envisages that when a power has been conferred upon a person, then he alone must exercise that power, unless expressly empowered to delegate to another. The right to decide dispute referred by assessee under the Act through alternative dispute resolution mechanism is granted exclusively to DRP and is sacrosanct in nature. Therefore, the DRP is nisi auctoritate i.e. the only authority which shall cease the dispute conclusively in accordance with provisions of the Act. The DRP is thus not empowered to gyrate the dispute by remanding it to assessing officer with any cinematic direction. In other words, when the statute prescribes a particular body or authority to exercise power, then it must be exercised by that body or authority alone. It is a trite law as laid down by Hon ble Supreme Court in case Chandra Kishore Jha Vs Mahavir Prasad reported in 8 SCC 266 (SC), that if a statute provides for a thing to be done in a partic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... This is because the law does not envisage for providing further opportunity to the assessee at the stage of passing of final assessment order in pursuant to direction. Thus, we are of the opinion that the direction of the Ld. DRP, as a whole empowering the Ld. AO to determine ALP is not in consonance with s/s (8) r.w.s/s. (5) of section 144C of the Act. 15. Now, in such situation, whether the entire direction of the DRP should be held as illegal which cannot be cured or whether it is an irregular exercise of power. In our considered opinion, if an authority has not carried out the function or exercised power, as provided in the statute or it has transgressed the statutory power, then it amounts to gross irregularity of exercising of power and such an irregularity is not fatal so as to declare the entire proceedings as null and void resulting into quashing of the final assessment order, all the most it renders it irregular. A distinction has to be made between illegal assumption of jurisdiction provided in the statute and irregular exercise of statutory power. 16. If a jurisdiction is to be assumed under a statute by a particular authority to act or to initiate action or there is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 144C, do not permit the DRP to set aside any proposed verification in the draft assessment order or issued any direction of further enquiry and passing of the assessment order. The same view can also be traced in the decision of co-ordinate bench in Swiber Offshore Construction Pte. Ltd. Vs Addl CIT(IT) [ITA 7724/Mum/2012]. 20. Without further multiplying the judicial precedents on the subject matter, we deem it fit to fist set aside the impugned direction of the Ld. DRP and then impugned consequential assessment orders passed in pursuance of such direction and restore these twin matters to Ld. DRP back to the stage of filing of objections for considering them in the light of evidences and pass an appropriate order giving clear direction either confirming or reducing or enhancing or deleting the variations/adjustment made by the Ld. TPO. 21. Thus, we accept the preliminary objection raised by both the parties and without going into the merits of the other grounds, we set-aside the impugned directions/orders in wholeness and remand these matters back to the file of the Ld. DRP with a direction to deal therewith in accordance with law after according not more than three effective op ..... X X X X Extracts X X X X X X X X Extracts X X X X
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