TMI Blog2023 (1) TMI 663X X X X Extracts X X X X X X X X Extracts X X X X ..... PO becomes infructuous after passing of final assessment order. Even the Dispute Resolution Panel, in this case, has also made the same observation. In view of this, the reassessment order, passed by the AO on the basis of illegal and invalid order of the TPO without following the due procedure as laid down in the relevant provision of section 144C of the Act, is not sustainable in the eyes of law and the same is, therefore, quashed. - I.T.A. No. 1423/Kol/2019 - - - Dated:- 10-1-2023 - Shri Sanjay Garg , Judicial Member And Shri Girish Agrawal , Accountant Member Shri Arun Chhabra, CA, appeared on behalf of the appellant Smt. Ranu Biswas, Addl. CIT-DR, appeared on behalf of the respondent ORDER Per Sanjay Garg, J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... show that though the Assessing Officer had referred the matter to the TPO u/s 92CA(1) on 7th September 2015, however, without waiting for the order of the TPO, the Assessing Officer passed the final assessment order on 22nd December 2016 itself. However, the ld. TPO continued the proceedings on the reference made by the Assessing Officer for transfer pricing adjustment. However, the assessee objected to the continuation of the proceedings before the TPO pleading that since the final assessment order has already been passed. The TPO, therefore, had become functus officio and that any proceedings before the TPO were invalid proceedings. However, the ld. TPO ignored the above objections and passed the transfer pricing order u/s 92CA on 30th O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .10.2017 and the draft assessment order was to be passed by the AO by 31.12.2017 incorporating the adjustments proposed by the TPO. The assessee thereafter has the option to accept the order of AO or to file Objection before the DRP, within 30 days of the receipt of the draft assessment order passed by the AO. In a case where Objection is filed before the DRP, under intimation to the AO, within the prescribed time period, the DRP is mandated to issue Direction u/s 144C(5) of the Act and the AO, thereafter, is mandated to pass final assessment order within 30 days of the end of the month in which the Directions of the DRP is received by him/her [s. 144C(15) of the Act]. 2.2 In this case the AO passed final assessment order on 22.12.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there was no transfer pricing adjustment order available for incorporation in the final assessment order, which was in fact passed on 30.10.2017 in terms of the reference made by the AO to the TPO during the original assessment proceedings. Without making a reference during the re-assessment proceedings the AO could not have incorporated any TP adjustment. The Hon'ble AP High court in the case of Zuari Cement Ltd. v ACIT has categorically held that violation of the mandatory provisions of s. 144C of the Act would make the complete assessment proceedings void-ab-initio and invalid, affirmed by the Apex Court in ACIT v Zuari Cement Ltd., SLP CC No. 16691/2013. 2.4 In this situation the objection of the assessee that for assessment u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he reference made during the original assessment proceedings and rather final assessment order was passed on 22.12.2016, it is evident that the case of the assessee is not covered under the provisions of s. 144C (15) of the Act as there was not any issue pertaining to cross-border transactions or business connection coupled with the existence of a permanent establishment, and therefore the DRP is of the view that the assessee's case is beyond the jurisdiction of the DRP, the case of the assessee not being an eligible assessee as per s.144C(15) of the Act. Hence, the draft re-assessment order passed by the AO on 01.11.2018 is beyond jurisdiction of the DRP. 3. In view of the above decision, the other grounds of objections become ..... X X X X Extracts X X X X X X X X Extracts X X X X
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