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2023 (11) TMI 449 - HC - Income TaxValidity of assessment order passed u/s 144C - assessment order passed by FAO two years after the DRP directions - Refund of amount paid in excess of the legitimate tax due on the returned income along with applicable interest - HELD THAT:- Section 144C of the Act is a self contained provision which carves out a separate class of assessees, i.e., ‘eligible assessee’. Section 144C was inserted in the Finance Act of 2009 and came into effect from 1st October 2009. When a Statute prescribes the power to do a certain thing in a certain 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 assessee. Hence, the FAO cannot be believed that the DRP direction was received by him only on 23rd August 2023 despite being uploaded on the ITBA portal on 25th March 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. The assessment order passed by FAO two years after the DRP directions, is time barred and cannot be sustained. Consequently, the ROI as filed has to be accepted. Petitioner is entitled to receive the refund together with interest, in accordance with law. The procedure to be completed within 30 days of this order being unloaded. This would, however, not preclude revenue, should the need arise, from reopening the assessment by following due process and in accordance with law.
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