9911796707
TMI Blog2019 (1) TMI 938X X X X Extracts X X X X X X X X Extracts X X X X ..... sub section 8 of Section 144C read with explanation to it. 5. On the facts and circumstance of the case, the Ld. DRP erred by not providing opportunity to the Assessing officer as envisaged in provision of sub section 11 of Section 144C. 6. Ld. DRP has erred in not considering that the definition of "firm" u/s 2(23)(i) of the income-tax Act, includes "Limited Liability Partnership" as defined in the LLP Act, 2008 whereas as per section 2(d) of the LLP Act, the LLP is a "body corporate" which means "a company" as defined in section 3 of the companies Act, 1956 and includes "A LLP incorporated outside India". Thus, a LLP incorporated outside India is considered a "Body Corporate" i.e. a company under the domestic laws. Therefore, the assessee is an "eligible assessee". 7. Without prejudice, similar draft order and final assessment order passed earlier in the case of the assessee for AY 2007-08 was accepted by the assessee and this issue has never been agitated by the assessee either before Hon'ble DRP or Hon'ble ITAT. 8. Hon'ble DRP has failed to appreciate that u/s 292B of the IT Act, 1961 no assessment made in pursuance of any provisions of this Act shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee is a foreign company. Thus, the Ld. DRP has no jurisdiction over the case and accordingly declined to issue any direction in this case and dismissed the proceedings in-limine. Thereafter, the AO vide his final assessment order dated 28.1.2015 passed u/s. 143(3) r.w.s. 144C(13) of the Act has assessed the income at Rs. 95,85,59,715/-. Now the Revenue is in appeal before us against the directions of the Ld. DRP dated 26.12.2014. 3. Ld. CIT(DR) has relied upon the order of the Assessing Officer. 4. Ld. Sr. Counsel has relied upon the order of the ld. DRP and also stated that the Ld. DRP has rightly held that the assessee is not an "eligible assessee" in accordance with section 144C(15)(b) as neither the TPO proposed any variation in the returned income nor the assessee is a foreign company. Thus, the Ld. DRP has no jurisdiction over the case and accordingly declined to issue any direction in this case and dismissed the proceedings in-limine. He also filed the copy ITAT, 'B' Bench decision dated 20.8.2018 in the case of sister concern of assessee i.e. Ess Advertising (Mauritius SNC etc. Compagnie (earlier known as ESPN Star Sports Mauritius SNC Etc. Compagnie) and stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the above, we are of.the considered opinion that the assessee is not. 0 . an "eligible assessee" in accordance with section 144C(15)(b) as neither the TPO proposed any variation in the returned income nor the assessee is a foreign company. Thus, we do not have the jurisdiction over the case. Consequentially, we decline to issue any direction in this case. The proceedings here are therefore, dismissed in-limine in view of the above. 5. Subject to the above finding, the other grounds of objections are not being considered here for issuing any direction." 5.1 We further note that ITAT, 'B' Bench vide its decision dated 20.8.2018 in the case of sister concern of assessee i.e. Ess Advertising (Mauritius SNC etc. Compagnie (earlier known as ESPN Star Sports Mauritius SNC Etc. Compagnie) has adjudicated the similar issue in dispute i.e. assessee is not an "eligible assessee" in accordance with section 144C(15)(b) of the Act, vide para no. 5 to 12 at page no. 4 to 11 as under:- "5. We have considered the rival submissions on the issue of additional ground raised by the assessee before us and also the material referred to and the judgments in support of the said ground. All the additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in income and or loss returned which is prejudicial to the interest of such assessee. The "eligible assessee" has been defined in clause (b) of sub section 15 which reads as under:- 144C(15)(b) "eligible assessee" means - (i) any person in whose case the variation referred to in sub-section (1) arises as a consequence of the order of the Transfer Pricing Officer passed under sub-section (3) of section 92CA and (ii) any foreign company." From the conjoint reading of the aforesaid provisions it is quite clear that assessee must be a foreign company in whose case the variation which has been referred and if there is any variation arising out of consequence of order passed by the TPO in terms of section 92CA (3), then only provision of section 144C can be triggered. Here in this case as noted by AO himself, there is no variation as a consequence of any order passed by the TPO as there is no adjustment made in the case of the assessee. We find that in the case of ESPN Star Sports Mauritius SNC ET Compagnie (supra) the Hon'ble Jurisdictional High Court on same issue had quashed such order passed u/s 144C (1) and consequently the final assessment order passed in pursuance of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 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." 14. Reverting to the assessment year under consideration, we find that the Assessing Officer passed draft assessment order u/s 144C(1) of the Act on receipt of the order from the TPO. Thereafter, the final assessment order was passed after routing the matter through the DRP. As the assessee is not an 'eligible assessee', the assessment should have been completed u/s 143(3) instead of adopting the path of passing the draft assessment order u/s 144C(1). We find that the facts and circumstances for the assessment year under consideration are identical to those considered and decided by the Hon'ble High Court in writ petition for the assessment year 2010-11. Respectfully following the binding precedent, we set aside the final assessment order. The additional ground is, therefore, allowed to this extent. 15. In view of our decision on the additional ground setting aside the assessment order, there i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 44C(1). 13................................. 14. In view of the above, it is clear that the petitioner, not being an "eligible assessee" in terms of Section 144C(15)(b) of the Act, the Assessing Officer was not competent to pass the draft assessment order under section 144C (1) of the Act. The draft assessment order dated 31.3.2015 is accordingly quashed. 15. Since we have quashed the draft assessment order, the question that the assessment has now become time barred is left open and it is open to the parties to take recourse of such remedy, as may be available to them in law." 11. Following these judgments, now there are numerous judgments not only passed by the various High Courts but also by this Tribunal, wherein it has been categorically held that, if assessee is not an "eligible assessee" in terms of section 144C(15)(b), then AO is not competent to pass a draft assessment order u/s 144C and the final assessment order consequently becomes time barred. Accordingly, following the aforesaid binding judicial precedents, we hold that the draft assessment order is invalid and consequently the impugned final assessment order is also unsustainable in law and is set aside. Con ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
