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TMI Blog2016 (7) TMI 1090X X X X Extracts X X X X X X X X Extracts X X X X ..... 2015 for the assessment year 2011-12. In W.P.No.9629 of 2016, the petitioner has challenged the order of assessment passed by the second respondent dated 29.01.2016 for the assessment year 2011-12. The impugned assessment order has been completed based upon the order passed by the Dispute Resolution Panel in exercise of its powers conferred under Section 144C(5) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) and such direction being implemented by the Assessing Officer in terms of Section 144C(13) of the Act and complete the assessment. Therefore, the result of W.P.No.5499 of 2016 would have a direct bearing on W.P.No.9629 of 2016 and therefore the correctness of the proceedings of Dispute Resolution Proceedings (hereinafter referred to as DRP ) is first taken up for consideration. 3. The impugned order has been challenged on the ground of violation of principles of natural justice. The learned senior counsel appearing for the petitioner has not advanced any arguments on the merits of the order passed by the DRP or on the merits of the assessment completed by the second respondent. The contention raised is that the DRP had hurriedly passed the order within a per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the DRP and made a request for adjournment and since the same was not being properly entertained, they had submitted their written submissions on 16.12.2015 and 17.12.2015 with the available materials and that does not mean that there is no violation of principles of natural justice especially taking into consideration the fact that the proceedings were completed within a short span of seven days and the petitioner have specifically pleaded violation of principles of natural justice and in the impugned order of DRP, the same having not been dealt with that the request for adjournment has either been accepted or had been rejected, the same cannot be improved by way of a counter affidavit, that too, by the Assessing Officer. The learned senior counsel appearing for the petitioner has placed reliance on the decision of the Hon'ble Supreme Court in the case of Mariamma Roy vs. Indian Bank and others reported in (2009) 16 SCC 187. He has also relied upon the decision of the Division Bench of High Court of Karnataka in the case GE India Technology Centre Pvt. Ltd. by G.V.Ramanna, Chief Financial Officer vs. Dispute Resolution Panel and Assistant Commissioner of Income Tax reported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rms of sub-section (2) of Section 144C, the petitioner had options to file their acceptance of the variations as done by the Assessing Officer in terms of Clause (a) of sub-section (2) of Section 144C or file their objection to such variations with the Dispute Resolution Panel and the Assessing Officer in terms of Clause (b)-(i) and (ii) of sub-section (2) of Section 144C of the Act. The Assessee in the instant case opted for the second option under Clause (b) and filed their objections before the Dispute Resolution Panel and the Assessing Officer on 17.04.2015. At this stage we may note that in terms of sub-section (12) of Section 144C, no direction under sub-section (5) shall be issued (by DRP) after nine months from the end of the month in which draft order is forwarded to the eligible assessee. The learned senior standing counsel submit that the period of nine months should be computed from 30.05.2015. But in my view the time should be computed from the date on which the Draft Assessment Order is received by the assessee as sub-section (12) of Section 144C uses the expression Draft order is forwarded . 9. Be that as it may, even accepting for the sake of argument that the time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . But nevertheless the petitioner is stated to have been made to participate in the proceedings and therefore, they submitted a written submissions/objections dated 16.12.2015 (copy of which was placed before this Court by the learned senior standing counsel appearing for the respondents), wherein apart from the merits of the proposed Draft Assessment, the following was stated: "......... In view of the above discussions and judicial precedents, the Company respectfully submits that it is entitled to produce additional evidence in support of its valid claim and your Honour would be acting within your jurisdiction to accept the same in the interest of justice and fair play and to decide the issues on merits. The Company respectfully submits that the DRP proceedings has been inserted in Chapter XIV of the Income Tax Act, 1961 which relates to assessment proceedings. Therefore, the DRP is a part of the assessment machinery and the proceedings before the DRP are a mere extension and part of the assessment proceedings. These are neither appellate nor settlement nor arbitration process. Hence, by virtue of Section 144C(7) of the IT Act, your Honours has ample powers to review and c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ournment was made and for certain reasons they have either accepted or refused to accept such request. This is a pre-requisite before the DRP could have passed an order on merits affecting the rights of the assessee. Furthermore, the object for constituting the DRP would stand defeated if the matters are to be given a summary disposal. The transaction done by the petitioner having international ramification, the interest of revenue would require careful scrutiny of the objections and the same dealt with in accordance with law, failing which the object with which the DRP has been constituted would stand defeated and therefore, this Court is of the view that the matter requires re-consideration. It may be true that the DRP while considering the materials placed by the petitioner before them had granted certain reliefs to the assessee, but that by itself will not validate the order and to state that the petitioner had been afforded an opportunity by the DRP. The concept of principles of natural justice which has been provided under the scheme of Section 144C of the Act should be an effective opportunity as the direction issued by the DRP binds the Assessing Officer and he would be req ..... X X X X Extracts X X X X X X X X Extracts X X X X
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