Tax Management India. Com
                        Law and Practice: A Digital eBook ...

Category of Documents

TMI - Tax Management India. Com
Case Laws Acts Notifications Circulars Classification Forms Manuals SMS News Articles
Highlights
D. Forum
What's New

Share:      

        Home        
 

TMI Blog

Home

2019 (6) TMI 658

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ing Draft Assessment Order u/s. 144C(1) is in violating of provisions of section 144C and hence, such final assessment order is unsustainable. Thus assessment order issued along with notice of demand u/s. 156 and notice of penalty u/s. 271(1)(c) is passed in violation of mandatory provisions of section 144C of the Act. - Decided in favour of assessee. - ITA No.2344/PUN/2012 - Dated:- 3-6-2019 - Shri D. Karunakara Rao, AM And Shri Vikas Awasthy, JM For the Assessee : Shri Nikhil Pathak For the Revenue : Shri S.B. Prasad ORDER PER VIKAS AWASTHY, JM : This appeal by the assessee is directed against the assessment order dated 31-10-2012 passed u/s. 143(3) r.w.s. 144C of the Income Tax Act, 1961 (hereinafter referred to as the Act ) for the assessment year 2008-09. 2. The assessee in appeal apart from challenging the additions on merits has raised additional grounds assailing validity of Assessment Order (Draft Assessment Order) dated 28-12-2011. Since, the assessee has challenged the validity of Assessment Order itself, therefore, before adverting to the grounds challenging additions on merits it would be imperative to first adjudicate the legal grounds raised by the assessee. The addi .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... it is final assessment order as the Assessing Officer had issued notice of demand u/s. 156 and notice of penalty u/s. 271(1)(c) along with the order. In effect the Assessing Officer passed the final assessment order without affording opportunity to the assessee to file objections before the DRP. Thus, the assessment order dated 28-12-2011 passed by the Assessing Officer is in violation of provisions of section 92CA of the Act. 3.2 The ld. AR further submitted that the assessee had filed objections before the DRP against the alleged Draft Assessment Order and the same were disposed of by the Dispute Resolution Panel (DRP) and thereafter the alleged final assessment order dated 30-10-2012 was passed but proceedings subsequent to the assessment order dated 28-12-2011 are vitiated after issuance of demand notice u/s. 156 and the notice of penalty u/s. 271(1)(c) of the Act. The ld. AR pointed that at no point of time the notice u/s. 156 and notice u/s. 271(1)(c) of the Act issued by Assessing Officer were withdrawn. The ld. AR in support of his contentions placed reliance on the following decisions : i. Pr. CIT Vs. Lionbridge Technologies Pvt. Ltd. in Income Tax Appeal No. 622 of 2016 .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... bsequent proceedings if any arising there from are vitiated. In the instant case, the facts are peculiar where the Draft Assessment Order has been passed and thereafter the assessee has filed objection before DRP. After the directions of DRP, final assessment order has also been passed. However, the Assessing Officer committed an error in issuing demand notice u/s. 156 and notice of penalty proceedings u/s. 271(1)(c) along with the Draft Assessment Order. The demand notice u/s. 156 and notice initiating penalty proceedings u/s. 271(1)(c) are issued only after passing of final assessment order. Since, the said notices were issued by the Assessing Officer along with the Draft Assessment Order, the said assessment order partake the character of final assessment order. The Assessing Officer at no point of time after issuing notice u/s. 156 and u/s. 271(1)(c) has withdrawn the said notices. The failure of Assessing Officer to adhere mandatory requirement of section 144C in not first passing the Draft Assessment Order invalidates the final assessment order and subsequent the proceedings arising there from. In catena of judgments by Hon ble High Courts it has been held that passing of fin .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ner of Income Tax 68 taxmann.com 246 - this Court has held that the Draft Assessment Order is necessary in terms of Section 144 C(1) of the Act before the Assessing Officer can proceed to pass a final Assessment Order. In the absence thereof, the order is without jurisdiction. So far the contention on behalf of the Revenue that the Respondent was estopped from challenging the corrigendum dated 16th April, 2004, as it was accepted by it and a representation also filed to the DRP. This submission overlooks the fact that there can be no estoppel on issue of law pertaining to jurisdiction. Therefore, if the corrigendum dated 16 th April, 2014 and the order dated 12th March, 2014 of the Assessing Officer is without jurisdiction, the same can be raised at any time and the principle of estoppel will not apply. Mere consent of parties does not bestow jurisdiction, if the order is beyond jurisdiction. Therefore, we do not find any substance in this objection of the Revenue. Besides, the finding of the Tribunal in the impugned order that the order of the Assessing Officer was beyond the scope of the remand by order dated 25 th January, 2012 of the Tribunal. This more particularly so as the r .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... see in the Court. On finding the relevant of the same, we proceed to extract the said case laws as follows :- a. International Air Transport Association vs. DCIT [68 taxmann.com 246 (Bombay)]. b. Nokia India Pvt. Ltd. vs. Addl.CIT [98 taxmann.com 373 (Delhi)]. c. ACIT vs. Vijay Television Pvt. Ltd. [46 taxmann.com 100 (Madras)]. d. DCIT vs. Rehau Polymers Pvt. Ltd. [85 taxmann.com 23(Pune)]. e. Sandvik Asia P. Ltd. vs. DCIT [ITA No.465 & 607/PN/14]. f. Walter Tools India Pvt. Ltd. vs. ACIT [ITA No.416/PN/14]. g. Soktas India Pvt. Ltd. vs. ACIT [77 taxmann.com 19]. h. JCB India Ltd. vs. DCIT [85 taxmann.com 155 (Delhi)] 8. Thus, Assessing Officer made the assessment order and issued demand notice and penalty notices as if the same is the final assessment order. Normally, the draft assessment order is never issued along with demand notice and penalty notice. Assessing Officer wanted the assessee to treat the said order as draft assessment order. Demand notice and penalty notices are issued only at the time of issue of the assessment order. Thus, Assessing Officer violated the provision of section 144C of the Act. Further, in the process of making/correcting the lapses, Assessing .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

 

 

 

 

|| Home || About us || Feedback || Contact us || Disclaimer || Terms of Use || Privacy Policy || Database || Members || Refer Us ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.
|| Site Map - Recent || Site Map ||