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TMI Blog2022 (9) TMI 1236X X X X Extracts X X X X X X X X Extracts X X X X ..... 609/DEL/2020, 654/DEL/2020 and 869/DEL/2020 pertaining to Assessment Years 2007-08, 2010-11 and 203-14 respectively, there is a delay in filing the appeals by 145 days, 21 days and 46 days respectively. 5. The contents of the application for condonation of delay have been duly considered and since the ld. DR has not raised any strong objection against the condonation of delay and finding that the assessee was prevented by reasonable and sufficient cause in not filing the appeals on or before the due date, the delay is condoned. 6. Except for appeal for Assessment Year 2005-06 in ITA No. 3115/DEL/2009, the assessee has raised additional ground which is common in all the Assessment Years and reads as under: "That on the facts and circumstances of the case and in law, the impugned order passed by the Assessing Officer is barred by limitation and void ab initio and, therefore, is liable to be quashed." 7. There is another additional ground raised in ITA Nos. 2601/DEL/2020, 654/DEL/2014, 189/DEL/2015, 4461/DEL/2016, 869/DEL/2018, 411/DEL/2018 and 2975/DEL/2019 and the same read as under: "That on the facts and circumstances of the case and in law, the Assessing Officer erred in p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... correctly assess the tax liability of an assessee." 14. Similar view has been taken in the case of Jute Corporation of India Ltd 187 ITR 688. 15. In light of the above ratio, we find that this Tribunal is not required to verify any new facts. Therefore, the additional grounds raised are admitted. 16. We will first address to the additional ground which reads as under: "That on the facts and circumstances of the case and in law, the Assessing Officer erred in passing a draft assessment order without appreciating that there was no variation in income returned by the appellant and, therefore the impugned order passed by the Assessing Officer is void ab initio and, therefore, is liable to be quashed." 17. The representatives of both the sides were heard at length, the case records carefully perused and relevant provisions of the Act have been duly considered. 18. Briefly stated, the facts of the case are that the Assessing Officer assumed jurisdiction over the assessee on filing of return by the assessee and accordingly, statutory notices were issued and served upon the assessee. 19. As per provisions of section 144C and 92B of the Act where the assessee had entered into inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in ITA No. 7076/MUM/2018. Pertinent findings of the co-ordinate bench are given as under: "11. In the instant case, the assessee herein is an eligible assessee. However, there is no variation in the income or loss returned, which is prejudicial to the interests of the assessee. Hence the second condition prescribed in sec.144C(1) was not satisfied. Hence the approach of the AO in adopting the procedure prescribed in sec.144C of the Act is not in accordance with the mandate of law. We get support for our view from the decisions rendered by Chennai bench and Pune bench of Tribunal in the cases referred above. Hence the assessment order passed by the AO gets vitiated and the same is liable to be quashed. We order accordingly." 24. Similar view was taken by the Tribunal Mumbai Bench in IPF India Property Cyprus [No. 1] in ITA No. 6077/MUM/2018. Relevant observations of the co-ordinate bench in this case read as under: "5. So far as the first issue is concerned, we find that, in the present case, there are no variations in the returned income and the assessee income. The controversy is thus confined to the question as to what will be the rate on which income returned by the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is no dispute that if no draft assessment order was to be issued in this case, the assessment would have been time barred on 31stDecember 2017 but the present assessment order is passed on 17th August 2018. Once we hold that no draft assessment order could have been issued in this case, as the provisions of Section 144C(1) could not have been invoked in this case, the time limit of completion of assessment was available only upto 31st December 2017. The mere issuance of draft assessment order, when it was legally not required to be issued, cannot end up enhancing the time limit for completing the assessment under section 143(3). We, therefore, uphold the plea of the assessee on this point as well. The impugned assessment order is indeed, in our considered view, time barred. We, accordingly, hold so. 8. As the impugned assessment order itself is held to be time barred, all other grievances raised in appeal, which deal with the merits of stand taken by the Assessing Officer in the assessment order, are rendered academic and infructuous. No adjudication, therefore, is required on these grievances at this stage." 25. This view also finds support from the Delhi Bench in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 153(1) of Date of final assessment order 2004-05 30-Mar-06 31-Dec-10 01-Sep-11 - 31-Mar-l 1 15-Sep-l 1 2007-08 24-Oct-07 24-Dec-09 21-Sep-10 - 31-Dec-09 04-Oct-10 2008-09 25-Sep-08 31-Dec-10 01-Sep-11 - 31-Dec-10 15-Sep-11 2009-10 30-Sep-09 23-Dec-11 25-Jul-12 - 31-Dec-l 1 31-Aug-12 2010-1i 12-May-11 07-Mar-13 14-Aug-13 - 31-Mar-l 3 30-Oct-13 2011-12 30-Sep-11 28-Jan-14 15-Oct-14 - 31-Mar-l 4 25-Nov-14 2012-13 12-Sep-12 19-Feb-15 - 29-Apr-15 31-Mar-l 5 30-Apr-15 2013-14 04-Sep-13 28-Mar-16 - 08-Apr-16 31-Mar-l 6 08-Apr-16 2014-15 15-Sep-14 07-Dec-16 - 27-Dec-16 31-Dec-16 06-Jan-17 2015-16 26-Aug-15 03-Nov-17 - 13-Dec-17 31-Dec-17 18-Dec-17 29. The Hon'ble High Court of Madras in the case of Roca Bathroom Products Pvt Ltd in Writ Appeal Nos. 1517, 1519, 1609, 1610 and 1854 of 2021 and CMP Nos. 9656, 9658, 10022, 10023 and 11720 of 2021 had the occasion to address an identical issue. It would be pertinent to refer to the relevant part of the judgment, which is directly on the challenge before us, which is as under: "After an international transact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or filing the objection had expired as per section 144C(4). As per the proviso to Section 92CA (3A), if the time limit for the TPO to pass an order is less than 60 days, then the remaining period shall be extended to 60 days. This implies that not only the time frame is mandatory but also the TPO has to pass an order within 60 days. Further, the extension in the proviso referred above also automatically extends the period of assessment to 60 days as per the second proviso to Section 153. That apart, but for the reference to the TPO, the time limit for completing the assessment would only be 21 months from the end of the assessment year. It is only if a reference has been made during the course of assessment and is pending, the department gets another 12 months as per second proviso to Section 153 (1) and under Section 153(4) after amendment. In Section 153(2A), a time limit is prescribed to the Assessing officer to complete the fresh assessment within one year prior to amendment and after amendment, as per section 153 (3), the time limit has been reduced to 9 months. As per the proviso to section 153 (3) if the order is received after 1st April 2019, the time limit is one year. Fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave not been concluded within a reasonable time. 20. As rightly contended by the learned senior counsels and affirmed by the Learned Judge, the DRP proceedings is a continuation of assessment proceedings. To put it further, it is a part of assessment proceedings, once the objections are filed and under section 144C (12) a period of 9 months is prescribed, within which, directions are to be issued by the DRP, failing which any directions are to be treated as otiose. As seen from the timeline discussed in the earlier paragraphs, the original assessment proceedings are to be completed within 21 months and the additional time of 12 months is granted when proceedings before TPO is pending. The TPO has to pass orders before 60 days prior to the last date. Then 30 days time is given to the assessee to file their objection before the DRP and the DRP is given 9 months time and thereafter, within one month from the end of the month of receipt of directions from DRP, the final order is to be passed. This court is not in consonance with the contention of the learned senior panel counsel for the appellants/ revenue that the time period of 33 months, provided initially is for the draft order a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 153 or Section 153 B is for a limited purpose to ensure that dehors larger time is available, an order based on the directions of the DRP has to be passed within 30 days from the end of the month of receipt of such directions. The section and the sub-section have to be read as a whole with connected provisions to decipher the meaning and intentions. At this juncture it would be useful to refer to the following decisions: (i) Sultana Begum v. Prem Chand Jain, (1997) 1 SCC 373 at page 381: "11. The statute has to be read as a whole to find out the real intention of the legislature. 12. In Canada Sugar Refining Co. v. R. [1898 AC 735 : 67 LJPC 126] , Lord Davy observed: "Every clause of a statute should be construed with reference to the context and other clauses of the Act, so as, as far as possible, to make a consistent enactment of the whole statute or series of statutes relating to the subject-matter." .......... 14. This rule of construction which is also spoken of as "ex visceribus actus" helps in avoiding any inconsistency either within a section or between two different sections or provisions of the same statute. 15. On a conspectus of the case-law indicate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... um v. Prem Chand Jain [(1997) 1 SCC 373 : AIR 1997 SC 1006])." (iii) Franklin Templeton Trustee Services (P) Ltd. v. Amruta Garg, (2021) 6 SCC 736 : 2021 SCC OnLine SC 88 at page 752: "17. The concept of "absurdity" in the context of interpretation of statutes is construed to include any result which is unworkable, impracticable, illogical, futile or pointless, artificial, or productive of a disproportionate counter-mischief [ See Bennion on Statutory Interpretation, 5th Edn., p.969.] . Logic referred to herein is not formal or syllogistic logic, but acceptance that enacted law would not set a standard which is palpably unjust, unfair, unreasonable or does not make any sense. [Bennion on Statutory Interpretation, 5th Edn., p. 986.] When an interpretation is beset with practical difficulties, the courts have not shied from turning sides to accept an interpretation that offers a pragmatic solution that will serve the needs of society [Id, p. 971, quoting Griffiths, L.J.] . Therefore, when there is choice between two interpretations, we would avoid a "construction" which would reduce the legislation to futility, and should rather accept the "construction" based on the view that dr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he entire proceedings as in the original assessment, would have to be completed within 12 months, as the very purpose of extension is to ensure that orders are passed within the extended period, as otherwise the extension becomes meaningless. (e) The outer time limit of 33 months in case of reference to TPO under Section 153, would not refer to draft order, but only to final order and hence, the entire proceedings would have to be concluded within the time limits prescribed, (f) The non-obstante clause would not exclude the operation of Section 153 as a whole. It only implies that irrespective of availability of larger time to conclude the proceedings, final orders are to be passed within one month in line with the scheme of the Act, (g) When no period of limitation is prescribed, orders are to be passed within a reasonable time, which in any case cannot be beyond 3 years. However, when the statute prescribes a particular period within which orders are to be passed, then such period, irrespective of whether it is short or long, shall be applicable." 31. As no distinguishing decision has been brought to our knowledge on this additional ground also, the impugned assessment ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e terms of the agreement. 37. The Assessing Officer estimated 85% of the total receipts and treated balance 15% business income of the assessee as taxable @ 40%. 38. The assessee challenged the assessment before the ld. CIT(A) but without any success. 39. Before us, the ld. counsel for the assessee, as mentioned elsewhere, moved an application u/r 29 of the ITAT Rules requesting for admission of additional evidences. 40. The ld. counsel for the assessee vehemently stated that additional evidences sought to be filed are relevant for deciding the issue of existence of PE. The ld. counsel for the assessee brought to our notice trade mark licence agreement dated 04.04.2013 which is said to be effective from 09.08.2002. 41. Though the ld. DR strongly objected to the admission of additional evidences, but such objection has already been dealt with by us elsewhere. The additional evidences have been admitted. 42. Before us, the ld. counsel for the assessee vehemently stated that the assessee entered into a licence agreement dated 09.08.2002 with Shri Anmol Dar who is an advertisement veteran based in India and who was allowed to use the trade mark/logo of SuperBrand Limited for the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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