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2018 (8) TMI 2106 - AT - Income TaxAssessment u/s 144C - Validity of draft assessment order - HELD THAT:- There are other judgments of Hon’ble Delhi High Court wherein similar issue has been decided in favour of the assessee like in the case of, Honda Cars India Limited [2016 (2) TMI 527 - DELHI HIGH COURT] as held that, if assessee is not an “eligible assessee” in terms of section 144C(15)(b), then AO is not competent to pass a draft assessment order u/s 144C and the final assessment order consequently becomes time barred. Accordingly, following the aforesaid binding judicial precedents, we hold that the draft assessment order is invalid and consequently the impugned final assessment order is also unsustainable in law and is set aside. Consequently the additional ground as well as the appeal of the assessee is allowed. “Eligible assessee” in terms of section 144C (15)(b) - AY 2006-07 & 2007-08 - As no transfer pricing adjustment or order u/s 92CA varying the returned income has been passed which is evident from the observation and the finding given by the AO in the impugned orders. In these years also, the AO has resorted to proposed draft assessment order u/s 144C (1) which is in absence of requisite condition that assessee was not the “eligible assessee” in terms of section 144C (15)(b). Hence, such a draft assessment order could not have been made, instead regular assessment order u/s 143 (3)/147 should have been passed. Thus, we hold that the impugned final assessment orders passed in the assessment years 2006-07 and 2007-08 are bad in law and are accordingly set aside. In these years also the appeal is allowed on the basis of additional ground raised.
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