TMI Blog2016 (1) TMI 932X X X X Extracts X X X X X X X X Extracts X X X X ..... n favour of assessee. - ITA No. 1019/Del./2015 - - - Dated:- 30-11-2015 - SHRI I.C. SUDHIR, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER For The Appellant : Sh. Atul Jain, C.A., Sh. Rohit Sharma, CA, Ms. Suchita Kanodia,CA, Ms. Rashmi Kathuria, CA For The Respondent : Sh. Amrendra Kumar, CIT/DR ORDER Per L.P. Sahu, Accountant Member: This appeal has been filed by the assessee against the order dated 30.01.2015 passed u/s. 143(3) read with section 144C(13) of the IT Act, 1961 (hereinafter referred to as the Act ) for the assessment year 2010-11 on the following grounds : 1. On facts, circumstances of the case and in law, the final order issued by the Learned Deputy Commissioner of Income Tax, Circle-2 ( Ld. AO ) under section 143(3) read with section 144C(13) of the Income-tax Act, 1961 ( the Act ) is invalid and bad in law. 2. . On facts, circumstances of the case and in law,, the Ld. AO and Learned Dispute Resolution Panel-1, New Delhi ( Ld. Penal ) erred in confirming the action of Additional Commissioner of Income Tax, Transfer Pricing Officer-1 (2) ( Ld. TPO ) of enhancing the income of the Assessee by INR 14,155,941 holding that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. TPO erred by incorrectly computing the operating profit margins of the finally selected companies in the order passed, thereby ignoring the correct computation provided by the assessee during the course of proceedings. 10. On facts and in law, the Ld. Panel and Ld. AO/Ld. TPO erred in computing the operating margins of the assessee by taking Excess provision written back of INR 40,03,709 as non-operating and not considering it as operational item. 11. On facts and in law, the Ld. AO/Ld. TPO erred in proposing to initiate penalty proceedings under section 271(1) of the Act when the facts of the case and provision of the law do not warrant such initiation of penalty proceedings. 2. The brief facts of the case are that the assessee company, a wholly owned subsidiary of Intercontinental Hotels Group (Asia Pacific) Pte Ltd, Singapore, is engaged, inter alia in the business of providing back office accounting support and registered as a STP unit for export of computer software/IT enabled services. He filed return electronically on 30.09.2010 declaring income of ₹ 4,00,031/- under normal provisions of the Act and ₹ 5,62,61,355/- as per provisions of sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as required to furnish its explanation. On 20.02.2014, the assessee furnished its submissions. The Assessing Officer rejecting the submissions of the assessee made addition of ₹ 9,41,55,941/- on account of difference between the value of transaction and ALP of the transaction computed by TPO, vide draft assessment order dated 25.02.2014. Aggrieved by this order, the assessee approached the Dispute Resolution Penal (DRP)-I, New Delhi, who gave directions u/s. 144C of the Act on 24.09.2014 as under : In view of discussion on each of the grounds of objection, the Assessing Officer is directed to complete the assessment as per the directions of the Panel as above. The AO shall place a copy of the Panel s order for Assessment Year 2010-11 at Annexure to the final order to be read as a part of the order. AO shall incorporate the reasons given by the Panel at appropriate places in respect of the various objections while passing the final order. The objections of the taxpayer are disposed off as above. Meanwhile on 25.09.2014, an order u/s. 127 was passed by CIT, Delhi-IV and the jurisdiction over the case was transferred from ITO ward 11(3), New Delhi to DCIT Circle 2(1), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 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 in the income or loss returned 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 sub-section (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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 153B, 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. On careful reading of the above provisions, it is clear that section 144C(13) provides that the order should have been passed within one month from the end of the month in which such direction is received. In the instant case, the ld. DRP gave directions on 24.09.2014 and as per above referred letter dated 03.11.2015, such directions were received by concerned AO on or before 28.10.2014. Therefore, the final order should have been passed on or be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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