2023 (11) TMI 1320 - AT - Income Tax

Validity of order passed u/s 92CA(3A) as barred by limitation - HELD THAT - The due date for completion of assessment u/s. 153(1) of the Act was 31/12/2019. The period of 60 days as referred to in section 92CA(3A) of the Act (excluding 31/12/2019 being the last date)for the purpose of limitation as referred to in section 153 of the Act would be from 01/11/2019 to 30/12/2019. Since the order u/s. 92CA(3) has been passed on 01/11/2019 the complete period of 60 days as mandated under sub-section (3A) of section 92CA of the Act are not available with the Assessing Officer for making the assessment order. Hence the order u/s. 92CA(3) of the Act is time barred by 1 (one) day. In Transporter Industry International Gmbh 2023 (9) TMI 737 - ITAT MUMBAI under similar set of facts after considering the decision in the case of Pfizer Healthcare India (P) Ltd. 2021 (2) TMI 1152 - MADRAS HIGH COURT and the decision of Saint Gobain India Pvt. Ltd. 2022 (4) TMI 808 - MADRAS HIGH COURT held that the order passed by the TPO on 01/11/2019 is beyond the limitation period prescribed under the Act hence bad in law. Thus no hesitation in holding that the order passed by the TPO in the present case is barred by limitation. Since there is no valid order u/s. 92CA(3) of the Act the extended period of limitation for passing of the assessment order as provided u/s. 153(4) of the Act would not be available to the Assessing Officer. Consequently the final assessment orderis also time barred. Decided in favour of assessee.

Summary

Issues:
Validity of order u/s. 92CA(3) of the Income Tax Act dated 31/10/2019 - Time limitation for passing the order - Date of order as per digital signature - Computation of limitation period - Impact on subsequent final assessment order u/s. 143(3) dated 30/06/2021.

The judgment addresses the challenge to the validity of an order u/s. 92CA(3) of the Income Tax Act dated 31/10/2019, based on the contention that it was passed beyond the period of limitation. The appellant argued that the order was digitally signed on 01/11/2019, making that the effective date of the order, rendering it time-barred by one day. The appellant relied on various decisions to support this argument, emphasizing the importance of the date of digital signature in determining the validity of the order.

The Tribunal analyzed the provisions of the Income Tax Act regarding the time limit for passing assessment orders, particularly focusing on sections 153 and 92CA(3A). The Tribunal referred to a decision by the Madras High Court in Pfizer Healthcare India (P.) Ltd. case to explain the computation of the limitation period for passing orders u/s. 92CA(3) of the Act. The Tribunal concluded that the order in question, passed on 01/11/2019, was indeed beyond the limitation period prescribed by law, as it should have been passed by 31/10/2019 or any date prior thereto.

The Tribunal cited the case of Transporter Industry International Gmbh, where a similar issue was considered, and held that the order passed on 01/11/2019 was beyond the prescribed limitation period, thus invalid. Relying on the legal provisions and precedents, the Tribunal determined that the order by the Transfer Pricing Officer was time-barred. Consequently, the final assessment order dated 30/06/2021 was also deemed time-barred due to the absence of a valid order u/s. 92CA(3) of the Act.

Ultimately, the Tribunal ruled in favor of the appellant, allowing the appeal due to the jurisdictional issue regarding the time limitation for passing the order u/s. 92CA(3) being breached. As a result, the other grounds raised by the appellant challenging additions on merit were not discussed, as they became academic. The appeal was allowed, and the final order was pronounced on 13th November 2023.