M/S MICROSOFT INDIA R AND D PVT. LTD vs PRINCIPAL COMMISSIONER OF INCOME TAX -4 & ANR.

2024-09-02 Information

* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment reserved on: 28 August 2024
Judgment pronounced on: 02 September 2024
+ ITA 52/2023 & CM APPL. 3673/2023
PR. COMMISSIONER OF INCOME TAX -7 …..Appellant
Through: Mr. Aseem Chawla, SSC with Ms. Pratishtha Chaudhary, Advocate.
versus

SUMITOMO CORPORATION INDIA (P) LTD……Respondent
Through: Mr. Himanshu S. Sinha, Mr. Prashant Meharchandani & Mr. Jainender Singh Kataria, Advs

+ ITA 451/2024 & CM APPL. 47709/2024 (10 days delay in filing)

PR. COMMISSIONER OF INCOME TAX -7 …..Appellant

Through: Mr. Ruchir Bhatia, SSC with Mr. Anant Mann, Mr. Pratyaksh, JSCs
versus

WICKWOOD DEVELOPMENT LTD. …..Respondent
Through: Ms. Kavita Jha, Sr. Adv with Mr. Vaibhav Kulkarni & Mr. Himanshu Aggarwal, Advs.

+ W.P.(C) 688/2019
MICROSOFT INDIA (R&D) PVT. LTD. …..Petitioner

Through: Mr. Nageswar Rao & Mr. Parth, Advocates
versus

DEPUTY COMMISSIONER OF
INCOME TAX & ANR. …..Respondents
Through: Mr. Gaurav Gupta, SSC with
Mr.Shivendra Singh & Mr. Yojit Pareek, JSCs for IT Deptt.

+ W.P.(C) 1009/2019
MICROSOFT INDIA (R&D) PVT. LTD. …..Petitioner
Through: Mr. Nageswar Rao, Mr. Parth, Advocates
versus

DEPUTY COMMSSIONER
OF INCOME TAX & ANR. …..Respondent
Through: Mr. Gaurav Gupta, SSC with Mr. Shivendra Singh & Mr. Yojit Pareek, JSCs for IT Deptt.

+ W.P.(C) 991/2019
MICROSOFT INDIA (R&D) PVT. LTD. …..Petitioner
Through: Mr. Nageswar Rao, Mr. Parth, Advocates
versus

DEPUTY COMMISSIONER OF INCOME TAX
& ANR. …..Respondents
Through: Mr. Gaurav Gupta, SSC with Mr. Shivendra Singh & Mr. Yojit Pareek, JSCs for IT Deptt.

+ W.P.(C) 995/2019
MICROSOFT INDIA (R&D) PVT. LTD. …..Petitioner
Through: Mr. Nageswar Rao, Mr. Parth, Advocates.

versus

DEPUTY COMMISSIONER OF
INCOME TAX & ANR. …..Respondents
Through: Mr. Gaurav Gupta, SSC with Mr. Shivendra Singh & Mr. Yojit Pareek, JSCs for IT Deptt.

+ W.P.(C) 993/2019
MICROSOFT INDIA (R&D) PVT. LTD. …..Petitioner
Through: Mr. Nageswar Rao, Mr. Parth, Advocates
versus

DEPUTY COMMISSIONER
OF INCOME TAX & ANR. …..Respondents
Through: Mr. Siddharth Sinha, SSC with Ms. Dacchita Shahi, Ms. Anuja Pethia, JSCs, Mr. Nring Chamwibo Zeliang, Ms. Anu Priya Nisha Minz, Advs.

+ W.P.(C) 12462/2021
JCB INDIA LIMITED …..Petitioner
Through: Mr. Ajay Vohra, Sr. Adv with Mr. Aditya Vohra & Mr. Shashwat Dhamija, Advs.
versus

NATIONAL FACELESS ASSESSMENT CENTRE DELHI
&ANR. …..Respondents
Through: Mr. Sanjay Kumar with Ms. Easha, Advs

+ W.P.(C) 12844/2021
SMART CUBE INDIA PVT LTD …..Petitioner
Through: Mr. Ajay Vohra, Sr. Adv with Mr. Aditya Vohra, Mr.Neeraj Jain, Mr. Shashwat, Advs.

versus
JOINT COMMISSIONER OF INCOME TAX …..Respondent
Through: Mr. Siddharth Sinha, SSC with Ms. Dacchita Shahi, Ms. Anuja Pethia, JSCs, Mr. Nring Chamwibo Zeliang, Ms.Anu Priya Nisha Minz, Advs.

+ W.P.(C) 3444/2021
M/S MICROSOFT INDIA R AND D PVT. LTD …..Petitioner
Through: Mr. Nageswar Rao, Mr. Parth, Advocates
versus

PRINCIPAL COMMISSIONER OF INCOME
TAX -4 & ANR. …..Respondents
Through: Mr. Gaurav Gupta, SSC with Mr. Shivendra Singh & Mr. Yojit Pareek, JSCs for IT Deptt.

+ W.P.(C) 3377/2021
MICROSOFT INDIA R AND D PVT LTD …..Petitioner
Through: Mr. Nageswar Rao, Mr. Parth, Advocates.
versus

PRINCIPAL COMMISSIONER
OF INCOME TAX-4 & ANR. …..Respondents
Through: Mr. Siddharth Sinha, SSC with Ms. Dacchita Shahi, Ms. Anuja Pethia, JSCs, Mr. Nring Chamwibo Zeliang, Ms. Anu Priya Nisha Minz, Advs.

+ W.P.(C) 3389/2021
M/S MICROSOFT INDIA (R AND D) PVT. LTD……Petitioner
Through: Mr. Nageswar Rao, Mr. Parth, Advocates

versus

PRINCIPAL COMMISSIONER OF INCOME
TAX -4 & ANR. …..Respondents
Through: Mr. Siddharth Sinha, SSC with Ms. Dacchita Shahi, Ms. Anuja Pethia, JSCs, Mr. Nring Chamwibo Zeliang, Ms. Anu Priya Nisha Minz, Advs.

+ W.P.(C) 3472/2021
MICROSOFT INDIA (R AND D) PVT. LTD. …..Petitioner
Through: Mr. Nageswar Rao, Mr. Parth, Advocates
versus

PRINCIPAL COMMISSIONER OF INCOME TAX – 4 & ANR.
…..Respondents

Through: Mr. Siddharth Sinha, SSC with Ms. Dacchita Shahi, Ms. Anuja Pethia, JSCs, Mr. Nring Chamwibo Zeliang, Ms. Anu Priya Nisha Minz, Advs.

+ W.P.(C) 3539/2021
M/S MICROSOFT INDIA R AND D PVT LTD …..Petitioner
Through: Mr. Nageswar Rao, Mr. Parth, Advocates.
versus

PRINCIPAL COMMISSIONER
OF INCOME TAX 4 & ANR. …..Respondents
Through: Mr. Siddharth Sinha, SSC with Ms. Dacchita Shahi, Ms. Anuja Pethia, JSCs, Mr. Nring Chamwibo Zeliang, Ms. Anu Priya Nisha Minz, Advs.

+ W.P.(C) 11896/2021
TELSTRA INDIA PRIVATE LIMITED …..Petitioner

Through: Mr. Manuj Sabharwal, Mr. Drona Negi & Mr. Ayush Kumar, Advs
versus

NATIONAL FACELESS ASSESSMENT
CENTRE & ORS. …..Respondents
Through: Mr. Sunil Agarwal, SSC with Mr. Shivansh B.Pandya, Mr. Viplav Acharya, JSCs & Mr.
Utkarsh Tiwari, Advocate.

+ W.P.(C) 11949/2021
CONTATA SOLUTIONS PRIVATE LIMITED …..Petitioner
Through: Mr. Amol Sinha, Mr. Kshitiz Garg & Mr. Sourav Verma, Advs.
versus

NATIONAL FACELESS ASSESSMENT CENTRE DELHI & ORS. …..Respondents
Through: Mr. Indruj Singh Rai, SSC, Mr. Sanjeev Menon, Mr. Rahul Singh, JSCs, Mr. Anmol Jagga, Advocates.

+ W.P.(C) 12204/2021 & CM APPL. 38228/2021 (Stay)
SWAROVSKI INDIA PRIVATE LIMITED …..Petitioner
Through: Mr. Himanshu S. Sinha, Mr. Prashant Meharchandani & Mr. Jainender Singh Kataria, Advs
versus

JOINT COMMISSIONER OF
INCOME TAX OSD …..Respondent
Through: Mr. Sanjay Kumar with Ms. Easha, Advs.

+ W.P.(C) 12319/2021
AXALTA COATING SYSTEMS
INDIA PRIVATE LIMITED …..Petitioner
Through: Mr. Salil Kapoor, Ms. Ananya Kapoor, Mr. Tarun Chawla, Mr. Sumit Lal Chandani & Mr. Utkarsa Kr. Gupta, Advocates.
Versus

NATIONAL FACELESS ASSESSMENT CENTRE, -EARLIER KNOWN AS NATIONAL E-ASSESSMENT CENTRE
…..Respondent
Through: Mr. Sanjay Kumar, SC with Ms. Easha, Adv.

+ W.P.(C) 4043/2022 & CM APPL. 12064/2022 (stay)
RAMTECH CONSULTING …..Petitioner
Through: Mr. Salil Kapoor, Ms. Ananya Kapoor, Mr. Tarun Chawla, Mr. Sumit Lal Chandani & Mr. Utkarsa Kr. Gupta, Advocates.

versus

NATIONAL FACELESS
ASSESSMENT CENTRE, DELHI. …..Respondent
Through: Mr. Sanjay Kumar with Ms. Easha, Advs.

+ W.P.(C) 5913/2022 & CM APPL. 17722/2022 (stay)
SOFTWAREONE INDIA PVT. LTD …..Petitioner

Through: Mr. Ajay Vohra, Sr. Adv with with Mr. Aditya Vohra & Mr. Shashwat Dhamija, Advocates.

versus

NATIONAL E-ASSESSMENT
CENTRE, DELHI …..Respondent
Through: Mr. Sanjay Kumar with Ms. Easha, Advs.

+ W.P.(C) 6365/2022 & CM APPL. 19227/2022 (stay)
SMART CUBE INDIA PVT LTD …..Petitioner
Through: Mr. Salil Kapoor, Ms. Ananya Kapoor, Mr. Tarun Chawla, Mr. Sumit Lal Chandani & Mr. Utkarsa Kr. Gupta, Advocates.
versus

DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 22(2)
…..Respondent

Through: Mr. Sanjay Kumar with Ms. Easha, Advs.

+ W.P.(C) 6786/2022 & CM APPL. 20625/2022 (exemption)
ADITYA TALWAR …..Petitioner
Through: Mr. Salil Kapoor, Ms. Ananya Kapoor, Mr. Tarun Chawla, Mr. Sumit Lal Chandani & Mr. Utkarsa Kr. Gupta, Advocates

versus

DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-19, …..Respondent
Through: Mr. Gaurav Gupta, SSC with Mr. Shivendra Singh & Mr. Yojit Pareek, JSCs for IT Deptt.

+ W.P.(C) 12735/2022 & CM APPL. 38706/2022 (stay)
SWAROVSKI INDIA PRIVATE LIMITED …..Petitioner
Through: Mr. Himanshu S. Sinha, Mr. Prashant Meharchandani & Mr. Jainender Singh Kataria, Advs
versus

DEPUTY COMMISSIONER
OF INCOME-TAX CIRCLE 22-2 …..Respondent
Through: Mr. Gaurav Gupta, SSC with Mr. Shivendra Singh & Mr. Yojit Pareek,JSCs for IT Deptt.

+ W.P.(C) 12784/2022 & CM APPL. 38902/2022 (stay)
SWAROVSKI INDIA PRIVATE LIMITED …..Petitioner
Through: Mr. Himanshu S. Sinha, Mr. Prashant Meharchandani & Mr. Jainender Singh Kataria, Advs
Versus

DEPUTY COMMISSIONER OF
INCOME-TAX CIRCLE 22.2 …..Respondent
Through: Mr. Gaurav Gupta, SSC with Mr. Shivendra Singh & Mr. Yojit Pareek,JSCs for IT Deptt.

+ W.P.(C) 12785/2022 & CM APPL. 38904/2022 (stay)
SWAROVSKI INDIA PRIVATE LIMITED …..Petitioner
Through: Mr. Himanshu S. Sinha, Mr. Prashant Meharchandani & Mr. Jainender Singh Kataria, Advs
versus

DEPUTY COMMISSIONER
OF INCOME-TAX CIRCLE 22.2 …..Respondent

Through: Mr. Gaurav Gupta, SSC with Mr. Shivendra Singh & Mr. Yojit Pareek,JSCs for IT Deptt.

+ W.P.(C) 7547/2023
AT KEARNEY INDIA PRIVATE LIMITED …..Petitioner

Through: Ms. Ishita Farsaiya, Mr. Sparsh Bhargava, Ms. Vanshika Taneja & Mr. Apurv Shukla, Advocates.

versus

DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 1(1), DELHI & ORS. …..Respondents
Through: Mr. Indruj Singh Rai, SSC, Mr. Sanjeev Menon, Mr. Rahul Singh, JSCs, Mr. Anmol Jagga, Advocates.

+ W.P.(C) 14314/2023 & CM APPL. 56688/2023 (stay)
KARL STORZ ENDOSCOPY
INDIA PRIVATE LIMITED …..Petitioner

Through: Mr. Vishal Kalra & Mr. Saumyendra S. Tomar, Mr. Ankit Sahni & Ms. Snigdha Gautam, Advocates.
Versus

NATIONAL FACELESS ASSESSMENT CENTRE, NEW DELHI & ANR. …..Respondents
Through: Appearance not given.

+ ITA 454/2024
PR. COMMISSIONER OF INCOME TAX -7 …..Appellant
Through: Mr. Ruchir Bhatia, SSC with Mr. Anant Mann, Mr. Pratyaksh Gupta, JSCs

versus

WICKWOOD DEVELOPMENT LTD. …..Respondent

Through: Ms. Kavita Jha, Sr. Adv with Mr. Vaibhav Kulkarni & Mr. Himanshu Aggarwal, Advs.

CORAM:
HON’BLE MR. JUSTICE YASHWANT VARMA
HON’BLE MR. JUSTICE RAVINDER DUDEJA

J U D G M E N T

YASHWANT VARMA, J.

1. This batch of writ petitions impugn the action of the Jurisdictional Assessing Officer1 who had proceeded to frame a final order of assessment pursuant to directions of remand framed by the Income Tax Appellate Tribunal2 and thus having acted in breach of the procedure prescribed by Section 144C of the Income Tax Act, 19613.
2. Pursuant to the directions issued by the Court, Mr. Rao, learned counsel who has led submissions on behalf of the writ petitioners, has placed on the record a chart which succinctly encapsulates the principal facts obtaining in each of the writ petitions. That collaborative chart has principally bifurcated matters into Categories A and B and is extracted hereinbelow:-
CATEGORY A

Sr.
No.
Case title and No.
Assessment
Year
Brief Background
Issues involved
1
PCIT v. Sumitomo Corporation India (P) Ltd.,

ITA 52/2023
2003-04
* This appeal by the Revenue seeks to assail the order passed by the Income Tax Appellate Tribunal (ITAT) dated 28th September 2021 wherein the ITAT upheld the action of the CIT(A) to set aside the final assessment order passed by the assessing officer without passing a draft assessment order during remand proceedings as mandated under Section 144C of the Act.
Limitation
* The ITAT order remitting the matter back to the file of TPO was passed on 11.06.2014 and therefore, as per fourth proviso to Section 153(2A), prior to its amendment vide Finance Act, 2016, the limitation for passing a legally valid final assessment order expired on March 31, 2017.
Whether a final assessment order passed without passing a draft assessment order as mandated under Section 144C of the Act is
tenable or not?

Whether it is mandatory for the assessing officer to pass a draft assessment order under Section 144C of the Act during remand proceedings?
2
JCB India Limited v. NFAC

W.P.(C) 12462/2021:
2018-19
* On 20.02.2020, the Petitioner filed the return of income for the subject AY declaring a total income of INR 1395,28,30,270. Petitioners return of income was processed under section 143(1) of the Act.
* On 28.07.2021, the TPO vide its order under section 92CA(3) of the Act proposed an upward transfer pricing adjustment of INR 5,93,54,095.
* On 24.08.2021, the Respondent /AO directly passed the final assessment order under section 143(3) read with section 144B of the Act along with demand notice under section 156 of the Act and penalty notice under section 274 read with section 270A of the Act.
* The final assessment order passed was also accompanied by a notice of demand issued under section 156 of the Act (along with the computation sheet), and a penalty notice issued under section 274 read with section 270A of the Act, thereby resulting in violation of mandatory provisions of section 144C of the Act.
Whether a final assessment order passed without passing a draft assessment order as mandated under Section 144C of the Act is tenable or not?
3
Smart Cube India Pvt Ltd vs Joint Commissioner of Income- tax

W.P.(C) 12844/2021
2010-11
* Income-tax return (ITR) filed by the Petitioner returning income of Rs. 3,78,120 was selected for scrutiny and notice was issued under section 143(2) of the Act.
* Assessing Officer (AO) passed draft assessment order (DAO) dated 21.03.2014 under section 143(3) read with section 144C, making addition of Rs.4,70,99,145, which included transfer pricing adjustment of Rs.1,91,52,594 and disallowance of deduction under section 10B of the Act of Rs.2,79,46,551.
* Objections were filed by the Petitioner against the DAO before the DRP, which issued directions dated 24.12.2014 under section 144(5), confirming the additions. Pursuant to the same, the AO passed the final assessment order dated 14.01.2015 under section 143(3) assessing the total income at Rs.4,74,77,270.
* Said final assessment order was challenged before the ITAT, which remanded the issue of transfer pricing adjustment to the TPO and the issue of disallowance of deduction under section 10B of the Act to the AO vide order dated 27.04.2018.
* In set aside proceedings, TPO passed order dated 05.01.2021 under section 92CA(3), proposing to make transfer pricing adjustment of Rs.1,80,69,890. The AO passed the final assessment order dated 29.09.2021 under section 143(3) read with section 254, assessing the total income of the Petitioner at Rs.4,63,94,561, after making revised transfer pricing adjustment as proposed by the TPO and disallowance of deduction claimed under section 10B of the Act.
* Said final assessment order was accompanied by notice of demand issued under section 156 and notice issued under section 274 read with section 271(1)(c) of the Act for initiating penalty proceedings.
In the 2nd round of proceedings pursuant to remand by the ITAT, despite the Petitioner qualifying as eligible assessee in terms of section 144C(15), draft assessment order was not passed by the Respondent, instead, assessment was straightaway finalized by way of final assessment order, which was accompanied by notice of demand and notice for initiating penalty proceedings

No opportunity was provided to the Petitioner to file objections before the DRP, even though the Respondent was mandated by law to first forward draft assessment order to the Petitioner under section 144C(1), thereby violating the substantive rights of the Petitioner as codified under section 144C of the Act.
4
Telstra India Private Limited v. NFAC.

W.P.(C) 11896/2021
2018-19
* That AO has passed a final assessment order dated 18.09.2021 against the petitioner without issuing the Draft Assessment Order as per mandatory provisions of s. 144C(1). The said action is jurisdictionally flawed. To clarify, there is no corrigendum in the matter.
* Notice of demand under s. 156 was also issued on 18.09.2021.
* On the basis of Supreme Court decision in Kalyan Kumar Ray v. CIT [1991] 191 ITR 634 (SC), the process of assessment has culminated
Whether the AO could have passed final assessment order without adherence to the mandatory provisions of Section 144C?
5
Contata Solutions Private Limited v. NFAC

W.P.(C) 11949/2021
2010-11
* 12.10.2010- Petitioner Company filed its original ITR.
* 29.08.2011- The case was selected for scrutiny assessment through CASS.
* 24.01.2014- On reference of the Assessing Officer, TPO passed an order u/s 92CA(3) of the Act.
* 10.03.2014- Draft Assessment Order under Section 143(3) r/w Section 144C of the Act, was passed by the AO.
* 16.12.2014- Aggrieved by the Draft Assessment Order, the Petitioner filed objections before the Dispute Resolution Panel [‘DRP’]. The DRP issued directions.
* 29.01.2015- The TPO proposed upwards adjustment of INR 52,25,570/- and arrived at the arms length price of INR 9,90,41,626/- (Rs.9,38,16,056/- +52,25,570/-) in the arms length price for the international transaction.
* 30.01.2015- Final Assessment Order was passed by the Assessing Officer.
* 15.01.2019- In the appeal preferred by the Petitioner against the final Assessment Order, dated 30.01.2015, passed by the Assessing Officer, the Income Tax Appellate Tribunal (‘ITAT’) granted some relief to the Petitioner by directing inclusion/exclusion of some comparables. Further, ITAT also directed to TPO to carry out fresh comparability analysis as per Rule 10D(2) of the Income-Tax Rules, 1963 and also to carry out FAR Analysis in respect of some comparables rejected by merely applying filers by the TPO.
* 21.01.2021- TPO passed a fresh order under section 92CA(3) of the Act, proposing even higher upwards adjustment of INR 1,16,23,102/- and arrived at the arms length price of INR 10,54,39,158/-(Rs.9,38,16,056/- + 1,16,23,102/-).
* 09.09.2021- Without passing the Draft Assessment Order contrary to the mandate of Section 144C(1) of the Act, the AO passed final Assessment Order under section 254/143(3)/144C(13) r/w Section 92CA(4) of the Act.
The final Assessment Order passed by the AO is without jurisdiction. This Honble High Court has held that the failure by the AO to first pass a draft assessment order would result in invalidation of the final assessment order and the consequent demand notices and penalty proceedings.
{Turner International India (P.) Ltd. v. Dy. CIT [2017] 82 taxmann.com 125/398 ITR 177 (Delhi) &
Headstrong Services India Pvt. Ltd.} Limitation has expired since A.Y is 2010-11.
6
Swarovski India Private Limited v. DCIT,

W.P.(C) 12204/2021
2010-11
* Present writ petition has been filed challenging the assessment order dated 29th September 2021 passed by the assessing officer in remand proceedings and the consequent demand and penalty notices without passing a draft assessment order as mandated under Section 144C of the Act.
* The petition was filed on the ground that the assessing officer erred in issuing a demand notice u/s 156 despite the fact that the addition made in the final assessment order was protective in nature.
* This Honble Court vide its order dated 28th October 2021, restrained the Respondent from taking any action pursuant to the impugned assessment orders, notice of demand and penalty notices.
Limitation
* The order of ITAT remitting the matter was passed on April 02, 2018, and therefore, the limitation of passing a legally valid final assessment order expired on December 31, 2020, as per Section 153(3) r.w. Section 153(4) of the Act. The assessment order was passed on September 29, 2021, which is beyond limitation.
Whether a final assessment order passed without passing a draft assessment order as mandated under Section 144C of the Act is tenable or not?

Whether it is mandatory for the assessing officer to pass a draft assessment order under Section 144C of the Act during remand proceedings?
7
Axalta Coating Systems India Private Limited v. NFAC

W.P.(C) 12319/2021
2018-19
* The Respondents have illegally proceeded to pass the final assessment order (Annexure P-3). The TPO passed the order on 31.07.2021 (Annexure P-2) and the Respondents instead of following the binding mandate of Section 144C and instead of issuing the draft assessment order, have directly proceeded to pass the impugned final assessment order and have raised the demand as well and initiated penalty proceedings.

8
Ramtech Consulting v. NFAC

W.P.(C) 4043/2022
2017-18
* The Respondents have illegally proceeded to pass the final assessment order (Annexure P-7). The TPO passed the order on 29.01.2021 (Annexure P-1) and the Respondents instead of following the binding mandate of Section 144C and instead of issuing the draft assessment order, have directly proceeded to pass the impugned final assessment order and have raised the demand aswell and initiated penalty proceedings. The Respondents in the first round had passed the draft assessment order and also final assessment order which was set-aside by this Honble Court on 14.07.2021 (P-5). Subsequently, the Respondents have not followed the mandate of law and have not passed any draft assessment order.
* Thereafter the Petitioner has also filed a CM application for amendment of writ for raising issue of DIN which Honble Court has taken on record vide order dated 13.12.2023.

9
Software one India Pvt. Ltd v. NeAC

W.P.(C) 5913/2022
2017-18
* The Respondents have illegally proceeded to pass the final assessment order (Annexure P-3). The TPO passed the order on 30.01.2021 (Annexure P-2) and the Respondents instead of following the binding mandate of Section 144C and instead of issuing the draft assessment order, have directly proceeded to pass the impugned final assessment order and have raised the demand aswell and initiated penalty proceedings.

10
Smart Cube India Pvt Ltd v. JCIT

W.P.(C) 6365/2022
2011-12
* Income-tax return (ITR) filed by the Petitioner returning income of Rs.3,19,590 was selected for scrutiny and notice was issued under section 143(2) of the Act.
* Assessing Officer (AO) passed draft assessment order (DAO) dated 27.02.2015 under section 143(3) read with section 144C, making addition of Rs.7,34,36,867, which included transfer pricing adjustment of Rs.5,52,01,139 and disallowance of deduction under section 10B of the Act of Rs.1,82,35,728.
* Objections were filed by the Petitioner against the DAO before the DRP, which issued directions dated 14.09.2015 under section 144(5), confirming the additions. Pursuant to the same, the AO passed the final assessment order dated 19.10.2015 under section 143(3) assessing the total income at Rs.7,37,56,457.
* Said final assessment order was challenged before the ITAT, which remanded the issue of transfer pricing adjustment to the TPO and the issue of disallowance of deduction under section 10B of the Act to the AO vide order dated 29.07.2020.
* In set aside proceedings, TPO passed order dated 29.03.2022 under section 92CA(3), proposing to make transfer pricing adjustment of Rs.1,43,77,827. The AO passed the final assessment order dated 30.03.2022 under section 143(3) read with section 254, assessing the total income of the Petitioner at Rs. 3,29,33,145, after making revised transfer pricing adjustment as proposed by the TPO and disallowance of deduction claimed under section 10B of the Act.
* Said final assessment order was accompanied by notice of demand issued under section 156 and notice issued under section 274 read with section 271(1)(c) of the Act for initiating penalty proceedings.
In the 2nd round of proceedings pursuant to remand by the ITAT, despite the Petitioner qualifying as eligible assessee in terms of section 144C(15), draft assessment order was not passed by the Respondent, instead, assessment was straightaway finalized by way of final assessment order, which was accompanied by notice of demand and notice for initiating penalty
proceedings.

11
Aditya Talwar vs. DCIT-

W.P.(C) 6786/2022
2017-18
* The Respondents have illegally proceeded to pass the final assessment order (Annexure P-3). The Petitioner is admittedly a non-resident and the Respondents instead of following the binding mandate of Section 144C and instead of issuing the draft assessment order, have directly proceeded to pass the impugned final assessment order and have raised the demand as well and initiated penalty proceedings.

12
Swarovski India Private Limited v. DCIT,

W.P.(C) 12735/2022
2008-09
* Present writ petitions have been filed challenging the assessment orders dated 22nd March 2022 for the Assessment Years 2008-09 & 2009-10 and 23rd March 2022 for the Assessment Year 2007-08, passed by the assessing officer in remand proceedings and the consequent demand and penalty notices without passing a draft assessment order as mandated under Section 144C of the Act.
* This Honble Court vide its order dated 5th September 2022, restrained the Respondent from taking any coercive action pursuant to the impugned assessment orders, notice of demand and penalty notices.
Limitation
For AY 2007-08
* The order of ITAT remitting the matter was passed on July 25, 2019, and therefore, the limitation of passing a legally valid final assessment order expired on March 31, 2022, as per Section 153(3) r.w. Section 153(4) of the Act. The final assessment order was passed on March 23, 2022.
For AY 2008-09
* The order of ITAT remitting the matter was passed on July 25, 2019, and therefore, the limitation of passing a legally valid final assessment order expired on March 31, 2022, as per Section 153(3) r.w. Section 153(4) of the Act. The final assessment order was passed on March 23, 2022.
For AY 2009-10
* The order of ITAT remitting the matter was passed on July 25, 2019, and therefore, the limitation of passing a legally valid final assessment order expired on March 31, 2022, as per Section 153(3) r.w. Section 153(4) of the Act. . The final assessment order was passed on March 23, 2022.
Whether a final assessment order passed without passing a draft assessment order as mandated under Section 144C of the Act is
tenable or not?

Whether it is mandatory for the assessing officer to pass a draft assessment order under Section 144C of the Act during remand proceedings?
13
Swarovski India Private Limited v. DCIT,

W.P.(C) 12784/2022
2007-08
*

14
Swarovski India Private Limited v. DCIT,

W.P.(C) 12785/2022
2009-10
*

15
Karl Storz Endoscopy India Private Limited v. NFAC

W.P. (C) No. 14314/2023
2020-21
* On 08.01.2021, the Petitioner filed the return of income for the subject year declaring total income of INR 26,27,44,510.
* On 30.07.2023, the TPO vide its order under section 92CA(3) of the Act, proposed an upward adjustment on account of AMP expenditure of INR 18,61,30,041.
* On 30.07.2023, the Respondent No.1, instead of passing a draft assessment order as mandated by the provisions of section 144C(1) of the Act, straightaway passed the final assessment order dated 30.07.2023 under section 143(3) read with section 144B of the Act, confirming the additions made by the TPO.
* The final assessment order dated 30.07.2023 was accompanied by a notice of demand issued under section 156 of the Act (along with the computation sheet), and a penalty notice issued under section 274 read with section 270A of the Act, thereby resulting in violation of mandatory provisions of section 144C of the Act.
Whether a final assessment order passed without passing a draft assessment order as mandated under Section 144C of the Act is tenable or not?
16
PCIT vs Wickwood Development Limited

ITA 451/2024
2008-09
* The assessee is company incorporated in BVI on 13.05.1991.
* A search and seizure operations under section 132 of the Act was conducted on 22.03.2012 in M/s Focus Energy group.
* Thereafter, a notice under section 153C of the Act was issued to the assessee on 18.11.2013.
* The assessing officer made reference to the Transfer Pricing Officer vide letter dated 20.12.2013. In order to verify the correctness of the exploration expenses paid by the assessee for AY 2006-07 to 2012-13.
* The assessee filed detailed objections to the assumption of jurisdiction vide letter dated 05.03.2014.
* The assessee in response to notice under section 153C filed income-tax return (ITR) on 18.03.2014 returning income of Rs.1,55,91,116.
* Assessing Officer (AO) passed final assessment order dated 28.03.2014 under section 153C read with section 144, making addition of Rs. 29,82,57,118.
* The final assessment order was challenged before the CIT(A) , which allowed the appeal filed by the assessee vide order dated 26.02.2015.
* The order dated 26.02.2015 was assailed by the Revenue before the ITAT on merits and the assessee also filed Cross Objections being CO No. 360/Del/2015.
* The ITAT, following the decision of this Honble Court in the case of Turner International India Pvt. Ltd. vs DCIT: W.P.(C) 4260/2015 held that it was obligatory on the part of the assessing officer to pass the draft assessment order in the first instance before passing of the final assessment order and no adjudication was required and done on the merits of the matter.
Whether on the facts and circumstances of the case and in law the Ld. ITAT is justified in allowing the objection filed by the assessee despite the fact that section 144C(l) of the Act is not applicable in the case of the assessee as the income earned during the assessment year only because of underlying assets or source of income is in India?

Whether on the facts and circumstances of the case and in law the Ld. ITAT is justified in allowing the cross objection filed by the assessee despite the fact that the section 144C(1) of the Act is not applicable in the case of the is eligible assessee as defined under section 144C(15) (b) of the Income Tax Act, 1961.
17
PCIT vs Wickwood Development Limited

ITA 454/2024
2009-10
* The assessee is company incorporated in BVI on 13.05.1991.
* A search and seizure operations under section 132 of the Act was conducted on 22.03.2012 in M/s Focus Energy group.
* Thereafter, a notice under section 153C of the Act was issued to the assessee on 18.11.2013.
* The assessing officer made reference to the Transfer Pricing Officer vide letter dated 20.12.2013. In order to verify the correctness of the exploration expenses paid by the assessee for AY 2006-07 to 2012-13
* The assessee filed detailed objections to the assumption of jurisdiction vide letter dated 05.03.2014.
* The assessee in response to notice under section 153C filed income-tax return (ITR) on 18.03.2014 returning income of Rs.6,12,64,160.
* Assessing Officer (AO) passed final assessment order dated 28.03.2014 under section 153C read with section 144, making addition of Rs. 1,82,53,79,696.
* The final assessment order was challenged before the CIT(A), which allowed the appeal filed by the assessee vide order dated 26.02.2015.
* The order dated 26.02.2015 was assailed by the Revenue before the ITAT on merits and the assessee also filed Cross Objections being CO No. 361/Del/2015.
* The ITAT, following the decision of this Honble Court in the case of Turner International India Pvt. Ltd. vs DCIT: W.P.(C) 4260/2015 held that it was obligatory on the part of the assessing officer to pass the draft assessment order in the first instance before passing of the final assessment order and no adjudication was required and done on the merits of the matter.
Whether on the facts and circumstances of the case and in law the Ld. ITAT is justified in allowing the objection filed by the assessee despite the fact that section 144C(l) of the Act is not applicable in the case of the assessee as the income earned during the assessment year only because of underlying assets or source of income is in India?

CATEGORY B

Sr. No.
Case Title and No.
AY
6
Swarovski India Private Limited v. DCIT,
W.P.(C) 12204/2021
2010-11
Event
Date
Date of ITAT order
(remanding for re-adjudication)
02.04.2018
Expiry of Limitation
[21 months from end of 31.03.2019 as per Section 153(3) r.w.s 153(4)]
31.12.2020
Date of TPO order in remand proceedings
(Beyond Limitation)
31.01.2021
Date of Final Assessment Order in remand proceedings
(Beyond Limitation)
29.09.2021

MICROSOFT INDIA (R&D) PRIVATE LIMIITED

WP (C) 1009/2019
WP (C) 993/2019
WP (C) 688/2019
WP (C) 991/2019
WP (C) 995/2019
S. No.
Particulars
AY 2006-07
AY 2007-08
AY 2008-09
AY 2009-10
AY 2010-11
1
Original Assessment order
16.09.2010
Annexure P-4 on pg. 40 of WP
21.10.2011
Annexure P-4 on pg. 33 of WP
Undated AO but notice of demand is dated 19-11-2012 Annexure P-4 on pg. 41
28.02.2014
Annexure P-4 on pg. 43 of WP
27.02.2015
Annexure P-4 on pg. 75 of WP
2
ITAT order
28.06.2016
Annexure P-5 on pg. 47 of WP
28.06.2016
Annexure P-5 on pg. 43 of WP
28.06.2016
Annexure P-5 on pg. 53
28.06.2016
Annexure P-5 on pg. 55 of WP
28.06.2016
Annexure P-5 on pg. 108 of WP
3
Consequential order passed u/s 254/143(3) rws 144C of the Act recomputing taxable income
31.08.2016
Annexure P-6 on pg. 70 of WP Address: 807, New Delhi House, Barakhamba
Road, Delhi 110001
31.08.2016
Annexure P-6 on pg. 66 of WP Address: 807, New Delhi House, Barakhamba Road, Delhi 110001
31.08.2016
Annexure P-6 on pg. 76 of WP Address: 807, New Delhi House, Barakhamba Road, Delhi 110001
31.08.2016
Annexure P-6 on pg. 78 of WP Address: 807, New Delhi House, Barakhamba Road, Delhi 110001
31.08.2016
Annexure P-6 on pg. 131 of WP Address: 807, New Delhi House, Barakhamba Road, Delhi 110001
4
Revised TPO order passed u/s 92CA rws 254 of the Act
31.10.2018
Annexure P-13 on pg. 83 of WP
31.10.2018
Annexure P-11 on pg. 78 of WP
31.10.2018
Annexure P-11 on pg. 88 of WP
31.10.2018
Annexure P-11 on pg. 90 of WP
October 2018 Annexure P-11 on pg. 143 of WP
5
Notice u/s 142(1) of the Act issued by AO
20.11.2018
Annexure P-14 on pg. 138 of WP
20.11.2018
Annexure P-12 on pg. 143 of WP
20.11.2018
Annexure P-12 on pg. 156 of WP
20.11.2018
Annexure P-12 on pg. 158 of WP
20.11.2018
Annexure P-12 on pg. 211 of WP
6
Due date for passing assessment
order u/s 153 pursuant to remand back
31.12.2018
31.12.2018
31.12.2018
31.12.2018
31.12.2018
7
Final assessment order u/s 143(3) rws 254 of the Act
20.11.2018
Annexure P-1 on pg. 24 of WP
Nov 2018 (Undated)
Annexure P-1 on pg. 24 of WP
28.12.2018
Annexure P-1 on pg. 25 of WP
30.12.2018
Annexure P-1 on pg. 25 of WP
25.12.2018
Annexure P- 1 on pg. 24 of WP
8.1
Demand notice u/s 156 of the Act
20.12.2018
Annexure P-2 on pg. 29 of WP
20.12.2018
Annexure P-2 on pg. 26 of WP
28.12.2018
Annexure P-2 on pg. 30 of WP
30.12.2018
Annexure P-2 on pg. 31 of WP
25.12.2018
Annexure P- 2 on pg. 30 of WP
8.2
Address to which demand notice u/s 156 has been sent in Round II of litigation
F-40, NDSE – 1, New Delhi 110049
Pg. 29 of WP
F-40, NDSE – 1, New Delhi 110049
Pg. 26 of WP
F-40, NDSE – 1, New Delhi 110049
Pg. 26 of WP
807, New Delhi House, Barakhamba Road, New Delhi – 110001
Pg. 31 of WP
F-40, NDSE – 1, New Delhi 110049
Pg. 26 of WP
9.1
Date of Dispatch of order u/s 254/ 143(3) of the Act to incorrect old address of
Andrewganj by AO
22.12.2018
22.12.2018
30.12.2018
–
27.12.2018
9.2
Date of Dispatch of order u/s 254/ 143(3) of the Act to correct address of Barakhamba Road
by AO

01.01.2019

10
Date of Letter filed with AO
requesting for true copy of the final assessment order.
07.01.2019
07.01.2019
07.01.2019
–
07.01.2019
11
Date of receipt of final assessment order
07.01.2019
Para 18-19 pg. 16 of WP
07.01.2019
Para 18-19 on pg. 16 of WP
07.01.2019
Para 18-19 on pg. 16-17 of WP
07.01.2019
Para 19 on pg. 17 of WP
07.01.2019
Para 19 on pg. 16 of WP
12.1
Date of filing Writ Petition
23.01.2019
23.01.2019
19.01.2019
23.01.2019
25.01.2019
12.2
Limitation expired on
31.12.2018
31.12.2018
31.12.2018
31.12.2018
31.12.2018

12.3
Grounds in Writ Petition filed by assessee

Pg. 17-19 of WP

Pg. 17-20 of WP

Pg. 18-21 of WP

Pg. 17-21 of WP

Pg. 17-20 of WP

12.4
Writ Petition- submission made by assessee on:
date of dispatch and address of dispatch

Para 19 on pg. 16 of WP

Para 18-19 on pg. 16 of WP

Para 18-19 on pg. 16-17 of WP

Para 19 on pg. 17 of WP Courier tracking Screenshot- 13 on pg. 159 of WP

Para 19 on pg. 16 of WP
13.1
Date of filing Counter Affidavit
19.11.2019
28.11.2019
19.11.2019
19.11.2019
19.11.2019
13.2
Counter affidavit of deparment does not deny date of dispatch and address of dispatch
The Revenue dept in para 2 on pg. 6 of the counter affidavit have mentioned that these are statement of facts and need no reply.
The Revenue dept in para 2 on pg. 6 of the counter affidavit have mentioned that these are statement of facts and need no reply.
The Revenue dept in para 2 on pg. 8 of the counter affidavit have mentioned that these are statement of facts and need no reply.
The Revenue dept in para 2 on pg. 6 of the counter affidavit have mentioned that these are statement of facts and need no reply.
The Revenue dept on pg. 6 of the counter affidavit have mentioned that these are statement of facts and need no reply.
14.1
Date of filing rejoinder
17.11.2020
17.11.2020
17.11.2020
17.11.2020
17.11.2020
14.2
Rejoinder- Submissions made by assessee on – date of dispatch and address of dispatch
Para 6 on pg. 3 – Though final assessment order- Round II was passed on 20.11.2018. Only after assessee filed submission dated 18.12.2018 (Annexure R-1 of rejoinder), the order was made available to assessee on 07.01.2019. This fact has not been denied by Revenue dept. in their counter affidavit.
Para 6 on pg. 2-3 – Though final assessment order- Round II was undated of November 2018, assessee filed submission on 18.12.2018 and impugned order has been passed only after it. The FAO – Round II is antedated and the same was made available to the assessee only on 07.01.2019.
This fact has not been denied by Revenue dept. in their counter
affidavit.
Para 6 on pg. 2-3 – Though final assessment order- Round II was passed on 28.12.2018, the same was made available to the assessee only on 07.01.2019. This fact has not been denied by Revenue dept. in their counter affidavit.
Para 6 on pg. 3- final assessment order- Round II passed on 30.12.2018, however the same was neither dispatched nor received within the statutory time limit. This fact has not been denied by the Revenue Dept in their counter affidavit.
Para 6 on pg. 2-3 – Though final assessment order- Round II was passed on 25.12.2018, the same was made available to the assessee only on 07.01.2019. This fact has not been denied by Revenue dept. in their counter affidavit.

MICROSOFT INDIA (R&D) PRIVATE LIMIITED

W.P. (C) 3377/2021
W.P. (C) 3472/2021
W.P.(C) 3444/2021
W.P. (C) 3389/2021
W.P. (C) 3539 of 2021
S. No.
Particulars
AY 2006-07
AY 2007-08
AY 2008-09
AY 2009-10
AY 2010-11
1
Original Assessment order
16.09.2010
Annexure P-4 on pg. 101 of WP
21.10.2011
Annexure P-3 on pg. 37 of the WP
19.11.2012
Annexure P-4 on pg. 210 of WP
28.02.2014
Annexure P-4 on pg. 113 of WP
27.02.2015
Annexure P-4 on pg. 160 of WP
2
Notice u/s 274 rws 271 of the Act issued by AO

16.09.2010

21.10.2011

19.11.2012

28.02.2014

27.02.2015
3
Response to sec 274 notice filed by the Petitioner before AO
20.12.2010
Annexure P-5 on pg. 108 of WP
30.11.2011
Annexure P-4 on pg. 47 of WP
21.12.2012
Annexure P-5 on pg. 222 of WP
26.03.2014
Annexure P-5 on pg. 125 of WP
26.03.2015
Annexure P-5 on pg. 193 of WP
4
Notice u/s 271(1)(c) of the Act issued by AO
07.02.2011
Annexure P- 6 on pg. 116 of WP
03.04.2012
Annexure P-5 on Pg. 49 of WP

–

–
05.08.2015
Annexure P-6 on pg. 197 of WP
5
Application filed by Petitioner before AO for keeping penalty proceedings in
abeyance
17.03.2011
Annexure P-7 on pg. 117 of WP
12.04.2012
Annexure P-6 on Pg. 50 of WP

–

–
26.08.2015
Annexure P-7 on pg. 198 of WP
6
ITAT Order
28.06.2016
Annexure P-8 on pg. 118 of WP
28.06.2016
Annexure P-7 on Pg. 53 of WP
28.06.2016
Annexure P – 6 on pg. 225 of WP
28.06.2016
Annexure P-6 on pg. 129 of WP
28.06.2016
Annexure P-8 on pg. 199 of WP
7
Consequential order passed u/s 254/143(3) rws 144C of the Act recomputing taxable income
31.08.2016
Annexure P-9 on pg. 141
31.08.2016
Annexure P-8 on pg. 76 of WP
31.08.2016
Annexure P – 7 on pg. 248 of WP
31.08.2016
Annexure P – 7 on pg. 152 of WP
31.08.2018
Annexure P-9 on pg. 222 of WP
8
Revised TPO order passed u/s 92CA rws 254 of the Act
31.10.2018
Annexure P-10 on pg. 145
31.10.2018
Annexure P-9 on Pg. 80 of WP
31.10.2018
Annexure P – 8 on pg. 252 of WP
31.10.2018
Annexure P – 8 on pg. 156 of WP
31.10.2018
Annexure P-10 on pg. 226 of WP
9
Final assessment order u/s 143(3) rws 254 of the Act
20.11.2018
Annexure P-11 on pg. 200 of WP
November 2018 (undated) Annexure P-11 on pg. 146 of WP
28.12.2018
Annexure P – 9 on pg. 320 of WP
30.12.2018
Annexure P – 9 on pg. 224 of WP
25.12.2018
Annexure P-11 on pg. 294 of WP
10
Notice u/s 274 rws 271(1)(c) of the Act issued by AO
17.06.2019
Annexure P-12 on pg. 205 of WP
17.06.2019
Annexure P-12 on pg. 151 of WP
17.06.2019
Annexure P-10 on pg. 329 of WP
17.06.2019
Annexure P-10 on pg. 233 of WP
17.06.2019
Annexure P-12 on pg. 299 of WP
11
Response to sec 274 notice dated 17.06.2019 filed by the Petitioner before
AO

27.06.2019
Annexure P-13 on pg. 206 of WP

28.06.2019
Annexure P-13 on pg. 152 of WP

27.06.2019
Annexure P-11 on pg. 330-347

28.06.2019
Annexure P-11 on pg. 234 of WP

28.06.2019
Annexure P-13 on pg. 300 of WP
12
Notice u/s 263 of the Act issued by the AO
04.03.2021
Annexure P-1 on pg. 30 of WP
04.03.2021
Annexure P-1 on pg. 31 of WP
04.03.2021
Annexure P-1 on pg. 29 of WP
04.03.2021
Annexure P-1 on pg. 30 of WP
04.03.2021
Annexure P-1 on pg. 30 of WP
13
Date of filing of Writ Petition
10.03.2021
16.03.2021
15.03.2021
11.03.2021
16.03.2021
14
Grounds in Writ Petition filed by assessee
Pg. 20-25 of WP
Pg. 20-26 of WP
Pg. 19-24 of WP
Pg. 19-25 of WP
Pg. 20-25 of WP
15
Date of filing of Counter Affidavit
Counter Affidavit filed in AY 2010-11, adopted for this year.
Counter Affidavit filed in AY 2010-11, adopted for this year.
Counter Affidavit filed in AY 2010-11, adopted for this year.
Counter Affidavit filed in AY 2010-11, adopted for this year.
20.05.2021
16
Date of filing of rejoinder
Rejoinder filed in AY 2010-11, adopted for this year.
Rejoinder filed in AY 2010-11, adopted for this year.
Rejoinder filed in AY 2010-11, adopted for this year.
Rejoinder filed in AY 2010-11, adopted for this year.
14.07.2021

3. While Category A comprises of matters where the solitary question which is raised is whether the AO was justified in proceeding to frame a final order of assessment and thus short circuiting the requirement of a draft assessment order being drawn in accordance with the requirement of Section 144C(1), the cases placed in Category B raise an additional challenge to the final orders of assessment with it being contended that the same came to be framed after the time prescribed under Section 153 of the Act had expired and thus being liable to be quashed on that ground additionally.
4. Although the facts have been duly captured in the chart which has been submitted by and on behalf of the writ petitioners jointly, we deem it appropriate to notice the following skeletal facts as they obtain in W.P.(C) 688/2019 (the principal writ petition on which arguments were addressed by learned counsels appearing for the writ petitioners) and W.P.(C) 11896/2021 (which was referred to by learned counsels representing the respondents).
5. Microsoft India (R&D) Pvt. Ltd., the writ petitioner in W.P.(C) 688/2019, is stated to have filed its Return of Income pertaining to Assessment Year4 2008-09 on 30 September 2008. The said return is stated to have been selected for scrutiny assessment and pursuant to which the AO made a reference to the Transfer Pricing Officer5 in terms contemplated under Section 92CA of the Act.
6. On 27 October 2011, the TPO passed an order recommending an upward adjustment to the total income of the petitioner. Pursuant to the aforesaid, a draft assessment order came to be framed on 27 December 2011. Assailing the proposed additions, the petitioner filed objections before the Dispute Resolution Panel6 in terms envisaged under Section 144C(2) of the Act. The aforenoted objections did not find favour with the DRP which and in terms of its directions dated 28 September 2012 affirmed the additions which were proposed in the draft assessment order. Pursuant to those directions, a final assessment order came to be framed on 19 November 2012.
7. Aggrieved by the aforesaid, the petitioner approached the Tribunal. The Tribunal in terms of its order dated 28 June 2016 allowed the appeal and framed the following operative directions: –
19. However, in the present case, it is an admitted fact that the said Circular was not in existence when the TPO passed the impugned orders for the respective assessment years i.e. assessment years 2007-08 to 2009-10, under consideration. However, he admitted while passing the orders u/s 92CA of the Act for the assessment year 2010-11 that TNMM is most appropriate method for determining the Ann’s Length Price. We, therefore, deem it appropriate to set aside this issue relating to the assessment years 2007-08 to 2009-10 to the file of the TPO/ AO to decide as to what is the most appropriate method by considering the facts and the guidelines available in the form of circular. As regards to the issue relating to the comparables for which the information u/s 133(6) of the Act were obtained by the TPO and which were not confronted to the assessee, we are of the view that this issue also deserves to be set aside to the file of the TPO/ AO for fresh adjudication in accordance with law after providing due and reasonable opportunity of being heard to the assessee. In the present case, it was also the common contention of both the parties that the corporate issues if involved in any of the aforesaid assessment years those should also be decided by the TPO/ AO along with the issues relating to the application of most appropriate method and the selection of the co1nparables and the additional ground relating to deduction u/s 10A of the Act. We order accordingly.
20. As regards to the assessment year 2010-11 is concerned, the ld. Counsel for the assessee admitted that there is no dispute relating to the application of most appropriate method. However, the additional ground relating to deduction u/s 1 0A of the Act was not before the TPO/ AO. The said grounds are purely legal grounds and raised first ti1ne before the Tribunal, so this issue raised in the additional grounds is remanded to the file of the TPO/ AO to be decided along with another assessment years under consideration. Since the issue relating to the deduction u/s 10A of the Act is restored to the file of the TPO/ AO, the another issues relating to corporate matters should also be decided by the TPO/ AO afresh in accordance with law after providing due and reasonable opportunity of being heard to the assessee.
21. As regards to the issues raised on the transfer pricing all matters in the grounds of appeal relating to assessment year 2010-11, the contentions of both the parties were sin1ilar as were 1n respect of the si1nilar grounds in another appeals relating to the other assess1nent years 2007-08 to 2009-10 which we have already adjudicated in former part of this order. Therefore, our findings given therein shall apply with the same force for this assessment year i.e. 2010-11 also.
8. Pursuant to the aforesaid order of the Tribunal, the TPO is stated to have issued a notice in the second round of proceedings which ensued on 09 November 2016. On 31 October 2018, the TPO passed its final order referable to Section 92CA computing the total upward adjustment of income at INR 106,07,00,458/-. Although the AO is thereafter stated to have issued a notice on 20 November 2018 under Section 142(1) of the Act, it proceeded to frame a final order on 28 December 2018. The writ petition was entertained by us on 22 January 2019 and an interim order passed restraining the respondents from enforcing the consequential demand.
9. Telstra India Private Limited7 is the writ petitioner in the second matter which had been selected by us for the purposes of chronicling the facts as they obtained. Its challenge pertains to AY 2018-19 and in connection with which it submitted its Return of Income on 30 November 2018. During the course of examination of that return, a notice referable to Section 143(2) came to be issued on 22 September 2019. This was followed by an intimation under Section 143(1) making aggregate disallowances of INR 113,88,283/-. This was assailed by Telstra before the Commissioner of Income Tax (Appeals)8 which ultimately allowed the challenge and deleted the disallowances. On 07 April and 28 July 2021, the petitioner was served with notices under Section 92CA intimating it of a reference having been made to the TPO. The TPO issued a show cause notice on 03 September 2021 apprising the writ petitioner of various adjustments which were proposed to be made. Since the additions proposed would have been binding on the AO in terms of Section 92CA(4), the petitioner chose not to make any further submissions. This led to a final order of assessment being passed on 18 September 2021. This was assailed by way of a writ petition before this Court. On 16 December 2021, interim orders came to be passed with it being provided that the assessment orders as well as consequential demand notices and penalty proceedings would remain stayed.
10. Since the arguments have revolved around Sections 144C and 153 of the Act, we deem it appropriate to extract those two provisions hereunder: –
Reference to Dispute Resolution Panel.
144C.
(1) The Assessing Officer shall, notwithstanding anything to the contrary contained in this Act, in the first instance, forward a draft of the proposed order of assessment (hereafter in this section referred to as the draft order) to the eligible assessee if he proposes to make, on or after the 1st day of October, 2009, any variation [* * *] which is prejudicial to the interest of such assessee.
(2) On receipt of the draft order, the eligible assessee shall, within thirty days of the receipt by him of the draft order,
(a) file his acceptance of the variations to the Assessing Officer; or
(b) file his objections, if any, to such variation with,
(i) the Dispute Resolution Panel; and
(ii) the Assessing Officer.
(3) The Assessing Officer shall complete the assessment on the basis
of the draft order, if
(a) the assessee intimates to the Assessing Officer the acceptance of the variation; or
(b) no objections are received within the period specified in subsection (2).
(4) The Assessing Officer shall, notwithstanding anything contained in section 153 [or section 153B], pass the assessment order under sub-section (3) within one month from the end of the month in which,
(a) the acceptance is received; or
(b) the period of filing of objections under sub-section (2) expires.
(5) The Dispute Resolution Panel shall, in a case where any objection is received under sub-section (2), issue such directions, as it thinks fit, for the guidance of the Assessing Officer to enable him to complete the assessment.
(6) The Dispute Resolution Panel shall issue the directions referred to in sub-section (5), after considering the following, namely:
(a) draft order;
(b) objections filed by the assessee;
(c) evidence furnished by the assessee;
(d) report, if any, of the Assessing Officer, Valuation Officer or Transfer Pricing Officer or any other authority;
(e) records relating to the draft order;
(f) evidence collected by, or caused to be collected by, it; and
(g) result of any enquiry made by, or caused to be made by, it.
(7) The Dispute Resolution Panel may, before issuing any directions referred to in sub-section (5),
(a) make such further enquiry, as it thinks fit; or
(b) cause any further enquiry to be made by any income tax
authority and report the result of the same to it.
(8) The Dispute Resolution Panel may confirm, reduce or enhance the variations proposed in the draft order so, however, that it shall not set aside any proposed variation or issue any direction under sub-section (5) for further enquiry and passing of the assessment order.
[Explanation. For the removal of doubts, it is hereby declared that the power of the Dispute Resolution Panel to enhance the variation shall include and shall be deemed always to have included the power to consider any matter arising out of the assessment proceedings relating to the draft order, notwithstanding that such matter was raised or not by the eligible assessee.]
(9) If the members of the Dispute Resolution Panel differ in opinion on any point, the point shall be decided according to the opinion of the majority of the members.
(10) Every direction issued by the Dispute Resolution Panel shall be
binding on the Assessing Officer.
(11) No direction under sub-section (5) shall be issued unless an opportunity of being heard is given to the assessee and the Assessing
Officer on such directions which are prejudicial to the interest of the
assessee or the interest of the revenue, respectively.
(12) No direction under sub-section (5) shall be issued after nine months from the end of the month in which the draft order is forwarded to the eligible assessee.
(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 in section 153 or section 153-B], 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.
(14) The Board may make rules for the purposes of the efficient functioning of the Dispute Resolution Panel and expeditious disposal of the objections filed under sub-section (2) by the eligible assessee.
[(14A) The provisions of this section shall not apply to any assessment or reassessment order passed by the Assessing Officer with the prior approval of the [Principal Commissioner or] Commissioner as provided in sub-section (12) of section 144BA.]
[(14-B) The Central Government may make a scheme, by notification in the Official Gazette, for the purposes of issuance of directions by the dispute resolution panel, so as to impart greater efficiency, transparency and accountability by
(a) eliminating the interface between the dispute resolution panel and the eligible assessee or any other person to the extent technologically feasible;
(b) optimising utilisation of the resources through economies of scale and functional specialisation;
(c) introducing a mechanism with dynamic jurisdiction for issuance of directions by dispute resolution panel.
(14C) The Central Government may, for the purpose of giving effect to the scheme made under sub-section (14B), by notification in the Official Gazette, direct that any of the provisions of this Act shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in the notification:
Provided that no direction shall be issued after the 31st day of March, [2024]
(14D) Every notification issued under sub-section (14B) and sub-section (14C) shall, as soon as may be after the notification is issued, be laid before each House of Parliament.]
(15) For the purposes of this section,
(a) Dispute Resolution Panel means a collegium comprising of three [Principal Commissioners or] Commissioners of Income-tax constituted by the Board for this purpose;
(b) eligible assessee means,
(i) any person in whose case the variation referred to in sub-section (1) arises as a consequence of the order of the Transfer Pricing Officer passed under sub-section (3) of section 92CA; and
[(ii) any non-resident not being a company, or any foreign
company.]

Time limit for completion of assessment, reassessment and recomputation.
153. (1) No order of assessment shall be made under section 143 or section 144 at any time after the expiry of twenty-one months from the end of the assessment year in which the income was first assessable:
[Provided that in respect of an order of assessment relating to the assessment year commencing on the 1st day of April, 2018, 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 in respect of an order of assessment relating to the assessment year commencing on
(i) 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 twelve months had been substituted;
(ii) the 1st day of April, 2020, 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 also that in respect of an order of assessment relating to the assessment year commencing on [* * *] the 1st day of April, 2021, the provisions of this sub-section shall have effect, as if for the words twenty-one months, the words nine months had been substituted:]
[Provided also that in respect of an order of assessment relating to the assessment year commencing on or after the 1st day of April, 2022, the provisions of this sub-section shall have effect, as if for the words twenty-one months, the words twelve months had been substituted.]
[(1A) Notwithstanding anything contained in sub-section (1), where a return under sub-section (8A) of section 139 is furnished, an order of assessment under section 143 or section 144 may be made at any time before the expiry of [twelve months] from the end of the financial year in which such return was furnished.]
(2) No order of assessment, reassessment or recomputation shall be made under section 147 after the expiry of nine months from the end of the financial year in which the notice under section 148 was served:
[Provided that where the notice under section 148 is served on or after the 1st day of April, 2019, the provisions of this sub-section shall have effect, as if for the words nine months, the words twelve months had been substituted.]
(3) Notwithstanding anything contained in sub-sections (1) [, (1A)] and (2), an order of fresh assessment [or fresh order under section 92CA, as the case may be,] in pursuance of an order under section 254 or section 263 or section 264, setting aside or cancelling an assessment, [or an order under section 92CA, as the case may be] may be made at any time before the expiry of nine months from the end of the financial year in which the order under section 254 is received by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, or, as the case may be, the order under section 263 or section 264 is passed by the [Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be,]:
[Provided that where the order under section 254 is received by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner or, as the case may be, the order under section 263 or section 264 is passed by the [Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner or, as the case may be,] on or after the 1st day of April, 2019, the provisions of this sub-section shall have effect, as if for the words nine months, the words twelve months had been substituted.]
[(3A) Notwithstanding anything contained in sub-sections (1), (1A), (2) and (3), where an assessment or reassessment is pending on the date of initiation of search under section 132 or making of requisition under section 132A, the period available for completion of assessment or reassessment, as the case may be, under the said sub-sections shall,
(a) in a case where such search is initiated under section 132 or such requisition is made under section 132A;
(b) in the case of an assessee, to whom any money, bullion, jewellery or other valuable article or thing seized or requisitioned belongs to;
(c) in the case of an assessee, to whom any books of account or documents seized or requisitioned pertains or pertain to, or any information contained therein, relates to,
be extended by twelve months.]
(4) Notwithstanding anything contained in [sub-sections (1), (1A), (2), (3) and (3A)], where a reference under sub-section (1) of section 92CA is made during the course of the proceeding for the assessment or reassessment, the period available for completion of assessment or reassessment, as the case may be, under the said [sub-sections (1), (1-A), (2), (3) and (3A)] shall be extended by twelve months.
(5) Where effect to an order under section 250 or section 254 or section 260 or section 262 or section 263 or section 264 is to be given by the Assessing Officer [or the Transfer Pricing Officer, as the case may be,] wholly or partly, otherwise than by making a fresh assessment or reassessment [or fresh order under section 92CA, as the case may be,] such effect shall be given within a period of three months from the end of the month in which order under section 250 or section 254 or section 260 or section 262 is received by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be, the order under section 263 or section 264 is passed by [the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be,]:
Provided that where it is not possible for the Assessing Officer [or the Transfer Pricing Officer, as the case may be,] to give effect to such order within the aforesaid period, for reasons beyond his control, the Principal Commissioner or Commissioner on receipt of such request in writing from the Assessing Officer, [or the Transfer Pricing Officer, as the case may be,] if satisfied, may allow an additional period of six months to give effect to the order:
[Provided further that where an order under section 250 or section 254 or section 260 or section 262 or section 263 or section 264 requires verification of any issue by way of submission of any document by the assessee or any other person or where an opportunity of being heard is to be provided to the as