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2016 (4) TMI 45 - DELHI HIGH COURTValidity of assessment order passed by the AO - Dispute Resolution Panel (DRP) declared that the AO lacked jurisdiction to deal with an issue - AO nevertheless proceeded to pass a final assessment order in the teeth of the order of the DRP. - Eligible assessee in terms of Section 144C(15)(b) - Matter was referred to Transfer Pricing Officer (‘TPO’) for determination of the arm’s length price (‘ALP’) - Held that:- In the first place the Court would like to observe that this is an instance of blatant disregard by the AO of the order of the DRP notwithstanding that the DRP had categorically held that the two Petitioners do not satisfy the conditions of an ‘eligible assessee’ in terms of Section 144 (15) (b) (ii) of the Act. As already noticed under Section 144C(10) of the Act the AO had no option but to comply with the order of the DRP. Even if no direction was issued by the DRP under Section 144C (5) of the Act, the fact that the DRP held that both the Petitioners were not ‘eligible Assessees’ could not have been ignored by the AO. It appears to the Court that it is plain that under Section 144C, the AO should have proceeded to pass an order under Section 143 (3) of the Act. Instead the AO confirmed the draft assessment order passed under Section 144C (1) of the Act. This, therefore, vitiated the entire exercise. The Court has no hesitation in holding that the final assessment order dated 28th January 2015 is without jurisdiction and null and void. The draft assessment order dated 28th March 2014, having been passed in respect of entities which were not 'eligible assessees', is also held to be invalid. An assessment order passed by the AO which is contrary to the mandatory requirement of Section 144C of the Act, is entirely without jurisdiction. Thus the draft assessment order dated 28th March 2014 and the final assessment order dated 28th January 2015 passed by the AO are held to be void ab initio and quashed on that basis. The orders consequential thereto also do not survive.
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