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TMI Blog2025 (1) TMI 599X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 13 of the I.T.Act deals with receipt which makes it clear that receipt occurs at the time when the electronic record enters the designated computer resource. Thus, the meaning of despatch or receipt is elaborately defined in aforesaid Sub-sections of Section 13 of the I.T.Act. The word computer resource is also defined under Section 2(k) of the I.T.Act, which reads thus: In the instant case, parties have taken a diametrically opposite view on the aspect whether the directions uploaded on the portal on 30.06.2022 can be treated to be receipt on the part of the assessing officer. Sri Vijhay K Punna, learned Standing Counsel for revenue contends that receipt will be the date when the e-mail was received by the revenue containing the DRP directions i.e., on 05.07.2020. As per the view taken by the aforesaid three High Courts there is no doubt that when the originator/DRP sends its directions in computer resource outside its control, it amounts to despatch and similarly, receipt takes place when said electronic record enters the computer resource. A conjoint reading of communications dated 30.01.2024 and 05.03.2024 (Annexure P-18) and communication dated 30.06.2022 (Annexure P-19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revised income tax return for Assessment Year 2018-2019 on 31.03.2019. Thereafter, the petitioner was selected for scrutiny assessment. Accordingly, a notice dated 22.09.2019 was issued under Section 143(2) of the Income Tax Act, 1961 (Income Tax Act) followed by certain more notices and questionnaires issued under Section 142(1) of the Income Tax Act. The petitioner has filed acknowledgment of return of income for Assessment Years 2018-2019 and 2019-2020 (Annexure P-1). It is pleaded that the petitioner, by different responses mentioned in paragraph No.8 of Writ affidavit pursuant to aforesaid notices, submitted all the necessary information along with the relevant documents to respondent No.1 for scrutiny assessment. 6. In turn, respondent No.1 completed the assessment in petitioner s case and passed the draft assessment order dated 27.09.2021 for Assessment Year 2018-19 proposing additions in this regard. The petitioner filed its objection before Dispute Resolution Panel (DRP). The DRP passed its direction/order dated 30.06.2022 and declined relief to the petitioner. 7. The respondents issued final assessment order on 30.08.2022 along with computation sheet, demand draft and pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned counsel for the petitioner is that once the originator/sender of DRP has uploaded its order on the portal, the originator has lost control over it and it is uploaded on the same day on the portal. Thus, as per aforesaid statutory provision, scheme and above judgments of three High Courts, it shall be presumed that the assessing officer came to know about the order of DRP on 30.06.2022 itself. Thus, as per Sub-Section 13 of Section 144C of the Income Tax Act, he could have passed the assessment order by 31.07.2022. The order passed beyond that period is illegal and unsustainable. Contention of Revenue: 11. Sri Vijhay K Punna, learned Standing Counsel for the revenue, submits that the order of DRP was received only on 05.07.2022 through web mail. Reliance is placed on the said mail communication dated 05.07.2022 (Annexure A) filed with the additional counter. Furthermore, on the basis of averments of the counter, it is submitted that the question of violation of time limitation prescribed under Section 144C(13) of the Income Tax Act as stated by the petitioner in the additional affidavit is not acceptable for the following reasons: (i) The intimation letter for order under S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt Centre (supra), which is followed in other judgments. He also placed reliance on judgment in the case of Commissioner of Income Tax, Chennai (supra) to bolster the submission that language of the statute should be given effect to and when plain language leads to only one conclusion, there is no reason to deviate from such meaning. FINDINGS: 13. Before dealing with rival contentions, it is apposite to consider Sections 144C(13) and 282(1)(c) of the Income Tax Act and Section 13 of the I.T. Act which reads thus: Section 144C: Reference to dispute resolution panel:- (1) to (12) (13) Upon receipt of the directions issued under sub-section (5), the Assessing Officer shall, in conformity with the directions, complete, notwithstanding anything to the contrary contained insection 153 or section 153B, the assessment without providing any further opportunity of being heard to the assessee, within one month from the end of the month in which such direction is received. Section 282: Service of notice generally:- (1) The service of a notice or summon or requisition or order or any other communication under this Act (hereafter in this section referred to as communication ) may be made by deli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at very provision commands the AO to complete the assessment within one month from the end of the month in which such a direction is received. 17. As is manifest from a reading of sub-section (13) of Section 144C of the Act, the AO is not accorded any discretion in the framing of an order of assessment once directions have come to be framed by the DRP. In fact, the provision requires the AO to frame an order of assessment in conformity with those directions and without providing any further opportunity of hearing to the assessee. This principle of law has been affirmed by the Bombay High Court in the aforenoted paragraphs of Vodafone Idea and in Shell India Markets Private Limited v. Additional Commissioner of Income Tax Officer, National Faceless Assessment Centre Ors10. The relevant paragraph of the decision in Shell India are extracted hereinbelow: 10. Sub-section (13) of Section 144C, therefore, is very clear inasmuch as the Assessing Officer shall, upon receipt of the directions issued under sub-section (5), in conformity with the directions, complete the assessment within one month from the end of the month in which such direction is received. Sub-section (13) also provides t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one Idea Ltd. (supra) opened as under: 15. Annexed to the affidavit of Mr. Satish Sharma is a screenshot of the CHN-Case History Notings of the Dispute Resolution Panel proceedings uploaded on the Income-tax Business Application portal. The screenshot is of the page as it appears on the Income-tax Business Application portal. A perusal of the screenshot of Case History Notings of the Dispute Resolution Panel read with the affidavit filed by Mr. Satish Sharma, the Chief Commissioner of Income-tax and Ms. Anne Varghese, the Joint Commissioner of Income-tax, clearly indicate that once the DRP directions are uploaded and the Document Identification Number ( DIN ) is generated, which is also visible on the first page of the hard copy of the DRP directions, the said document is visible to the AO of the Faceless Assessment Unit ( FAU ) having jurisdiction over the permanent account number of the assessee concerned. Thus, both the affiants agree that the Dispute Resolution Panel directions once uploaded on the Income-tax Business Application portal are automatically visible to the Faceless Assessing Officer, if any assessment work item is pending related to a particular permanent account n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n way, then the thing must be done in that way and other methods of performance are forbidden. Once the statute has prescribed a limitation period for passing the final order, it is expected that the internal procedure of the Department should mould itself to give meaning to and act in aid of the provision. Any procedural defect (there is none in this case) in the internal mechanism of the working of E-assessment Scheme, cannot operate against the interest of the assessee. Hence, the Faceless Assessing Officer cannot be believed that the Dispute Resolution Panel direction was received by him only on August 23, 2023 despite being uploaded on the Income-tax Business Application portal on March 25, 2021. The failure on the part of Department to follow the procedure under section 144C of the Act is not merely a procedural irregularity, but is an illegality and vitiates the entire proceeding. 17. The Madras High Court in Taeyang Metal India (P) Ltd. (supra) followed the principle laid down by the Delhi High Court in the aforesaid judgment. 18. The common string traveling through the judgments of the aforesaid three High Courts leaves no room for any doubt that the Courts have taken a un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bhavnagar University Vs. Palitana Sugar Mill (P) Ltd. (2003) 2 SCC 111 ). 22. So far, the judgment in the case of Commissioner of Income Tax, Chennai (supra) is concerned on which reliance is placed by Sri Vijhay K Punna, it is profitable to note that in the said case, the Supreme Court considered Section 263(2) of the Income Tax Act, in the said Section the word used is made and not receipt of the order . The Supreme Court emphasized the cardinal principle of the law that provision of statute is to be read as it is and nothing is to be added or taken away from the provision of the statute. In other words, this is well settled that when language of statute is clear and unambiguous, it has to be given effect to irrespective of its consequences (see Nelson Motis vs. Union of India 1992 (4) SCC 711 ). 23. The pivotal question is whether in view of the language employed in Section 144C(13) whether directions of DRP can be said to be received by the assessing officer on 30.06.2022. A conjoint reading of Section 144C (5) and (13) makes it clear that upon receipt of directions issued under Section 144C(5), it is imperative for assessing officer to complete the proceedings within one month ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... larly, receipt takes place when said electronic record enters the computer resource. 29. Section 282 of the Income Tax Act on which reliance was placed by Sri Vijhay K Punna, learned Standing Counsel for revenue makes it clear that in Sub-Section 1(c) of Section 282, the communication through electronic record as per Chapter IV of the I.T.Act was recognized and treated to be service of notice generally. Chapter IV of the I.T.Act contains Section 13, which envisages time, place of despatch and receipt of electronic record. 30. In order to meticulously examine the aspect of despatch and receipt , in the present case, it is apt to quote the relevant portion of letter dated 05.03.2024 filed along with I.A.No.1 of 2024 in the present matter, which reads as under: 2. In this regard, it is hereby stated that the direction dated 30.06.2022 were uploaded on ITBA portal on 30.06.2022. Further, physical copy of the Directions was also sent to the Assessing Officer on 30.06.2022 through Speed Post. ( Emphasis Supplied ) 31. The Income Tax Department through communication dated 30.06.2022 (Annexure P-19) informed that the order under Section 144C(5) dated 30.06.2022 is having Document No.(DIN) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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