TMI Blog2018 (1) TMI 1550X X X X Extracts X X X X X X X X Extracts X X X X ..... . It is factually established that the AO in the final order of assessment dated 17/1/2014 has not given effect to or carried out the binding directions of the DRP as required u/s 144C(10) within the time specified u/s 144C(13) of the Act; which is a clear violation of the binding provisions of sec. 144C(10) and (13) of the Act. Therefore, in our considered opinion, the conduct of the AO/TPO in passing the impugned final order of assessment dated 17/1/2014 is a clear case of defiance and disregard to the binding directions of the higher authorities, i.e, the DRP in the case on hand. In fact, in the impugned order dated 17/1/2014 there is not even a single reference to the DRP's directions issued us/ 144C(5) of the Act vide order dated 30/12/2013. Impugned final order of assessment for asst. year 2008-09 passed u/s 143(3) r.w.s 92CA of the Act by the AO, in violation of the express mandatory provisions of sec. 144C(10) and (13) of the Act by not passing the impugned order in pursuance of and in conformity with the binding directions of the DRP issued u/s 144C(5) of the Act, within the time specified for this purpose, has rendered the said impugned final order of assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT vs Encore Software Ltd in ITA No. 1142 of 2006 7. The TPO, DRP and the Assessing Officer erred in rejecting the comparables selected by the appellant without giving any cogent reasons. 8. The TPO, DRP and the Assessing Officer erred in not applying employee cost filters for a labour intensive industry wherein the appellant operates. 9. The TPO, DRP and the Assessing Officer failed to understand the spirit and intent of Rule JOB (1) (e) (ii) as per which even if one of the comparables selected by the appellant satisfies the computation mechanism for determination of the ALP, the determination of ALP by using arithmetic mean of different comparables not warranted. 10. The TPO, DRP and the Assessing Officer erred in selecting the following new companies as comparables towards software development services under the facts and circumstances of the case a) Bodhtree Consulting Ltd., b) Infosys Ltd c) Kals Information Systems Ltd., d) Larsen Tubro infotech e) Mindtree Ltd., J) Persistent Systems Ltd., g) Sasken Communication Technologies Ltd., h) Tata Elsxi Ltd., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se. The appellant expressly urges that the period of levy of interest is not in accordance with section 234B of the Act. 19. The appellant craves leave to add, alter, delete, modify any of the grounds which are urged above. 20. For the above and such other grounds as may be urged at the time of hearing the appellant prays your Honour to consider the facts and circumstances of the case and justice be rendered. 3. Ground No.17 3.1.1 At the outset of the hearing, the Id AR of the assessee sought to be heard on ground No.17 (Supra), which is a technical ground. In this ground the assessee has assailed the impugned order of assessment dated 17/1/2014 for asst. year 2009-10 to be bad in law, as the said order ought to have been passed u/s 143(3) r.w.s 144C of the Act and not under sec. 143(3) r.w.s 92CA of the Act. 3.1.2 According to the id AR for the assessee, the directions issued by the Dispute Resolution Panel ('DRP') u/s 144C(5) of the Act are binding on the AO/TPO, as has been laid out in sec. 144C(1O) of the Act. Therefore, the AO ought to have passed the impugned order of assessment u/s 143(3) r.w.s 144C(13) of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the DRP issued uls 144C(5) of the Act, which has clearly not been done. The Id DR, however, prayed that, in the interest of equity and justice, since the AO's error is not fatal the impugned final order of assessment be set aside and the AO be directed to pass a fresh final order in conformity with the DRP's directions. 3.3.1 We have heard the rival contention of both parties in the matter and perused and carefully considered the material on record. The undisputed facts on record, as brought out by the discussions above, is that the AO, as per law, was required to pass the final order of assessment dated 17/1/2014 for asst. year 2009-10 u/s 143(3) r.w.s 144C of the Act in conformity with the directions issued by the DRP u/s 144C(5) of the Act, which are binding on him as per section 144C(10) thereof and within the time prescribed u/s 144C(13) of the Act. We find that instead of passing the final order of assessment as required by law, the AO passed the impugned final order of assessment dated 17/1/2014 u/s 143(3) r.w.s 92CA of the Act; which, as contended by the id AR, is identical to the draft order of assessment passed on 14/3/2013 by only incorporating this TPO ..... X X X X Extracts X X X X X X X X Extracts X X X X
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