TMI Blog2023 (8) TMI 628X X X X Extracts X X X X X X X X Extracts X X X X ..... the TP Order at any time before sixty days prior to the date on which the period of limitation referred to in section 153, or as the case may be, in section 153B for making the order of assessment or reassessment or recomputation or fresh assessment, as the case may be, expires. Therefore, 60 days period from 31/3/2015 expires on 29 January 2015. But the ld TPO has passed TP Assessment order u/s 92CA (3) of the Act on 30th January 2015. Thus, the order of ld TPO is passed beyond statutory time available. Whether assessee ceases to be an 'eligible assessee' within the meaning of section 144C (15) (b)? - The moment an assessee ceases to be an 'eligible assessee' in absence of valid transfer pricing order, the ld AO should not have passed the draft assessment order. Thus provision of section 144C does not apply to the assessee. Thus, the time limit for completion of the assessment reverts back to 21 Months from the end of the assessment year. Therefore, as held by the co-ordinate Bench in ATOS India Private Limited [ 2023 (2) TMI 1112 - ITAT MUMBAI] the final assessment order passed by AO on 26 th February, 2016 is also barred by limitation. Therefore, follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t order on 23 rd March, 2015, determining the total income of the assessee as per normal computation of ₹ 636,23,59,083/-. The assessee preferred the objections before the learned Dispute Resolution Panel-1, Mumbai. The learned Dispute Resolution Panel issued directions under Section 144C (5) of the Act, on 30th December, 2015. Based on these directions, the assessment order under Section 143(3) read with section 144C(13) of the Act was passed on 26 th February, 2016, determining the total income of the assessee at ₹ 353,09,30,700/-. The transfer pricing adjustment was restricted at ₹ 89,91,09,379/-. 05. Therefore, the assessee is aggrieved by the various additions/ adjustments contained in the assessment order and is in appeal before us in ITA No.2779/Mum/2016. The learned Assessing Officer is aggrieved by the directions of learned Dispute Resolution Panel and therefore, is in appeal in ITA No.3015/Mum/2016. The cross objection filed by the assessee in CO No. 33/Mum/2017 against ITA No.3015/Mum/2016, is merely supportive in nature. 06. At the time of hearing assessee preferred an additional ground of appeal as per ground no.40 to 42 as under:- On the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 229 ITR 383 and Jute Corporation of India Ltd. in 187 ITR 688. Further, decision of the Hon'ble Bombay High Court in case of Ahmedabad Electricity Co. Ltd in 199 ITR 351. 09. The learned Departmental Representative vehemently objected the same, stating that these additional grounds were never raised before the learned Assessing Officer and therefore, should not be admitted. 010. We have carefully considered the rival contentions and perused the orders of the lower authorities. We have also carefully perused the application for admission of the additional ground. The assessee has challenged the validity of transfer pricing order stating that the orders are passed under Section 92CA (3) of the Act, late by 1 day and therefore, is not passed within the due time. It is also the claim of the assessee that as the order of the Transfer Pricing Officer is invalid, the assessee cannot be said to be an 'eligible assessee' in terms of explanation to section 144C of the Act and hence, the final assessment order passed on 26 February 2016 is barred by limitation. All these above facts are available on record. Merely, the dates of passing of the order are required to be conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , grounds of appeal in the cross objection and grounds of appeal in the appeal of the learned Assessing Officer becomes merely academic. 013. The learned Departmental Representative vehemently opposed the argument of the assessee and relied upon the decision of Louis Dreyfus Commodities India (P.) Ltd. (2022) 138 taxmann.com 556, wherein it has been held that even if the learned TPO s order is held to be bad in law, the draft assessment order and subsequent final assessment order cannot be said to be invalid order. 014. The learned Authorized Representative submitted that the decision cited by the learned Departmental Representative does not apply with respect to the final assessment order passed by the learned Assessing Officer as that was not the case before the co-ordinate Bench. He further submitted that in Mondelez India Foods P. Ltd in ITA No. 1492/Mum/2015 dated 14 November, 2022 has considered the above case. He further submitted that before the co-ordinate Bench in Louis Dreyfus Commodities India (P.) Ltd. (supra), there were no occasions to consider the definition of 'eligible assessee' and consequent validity of entire assessment proceedings. Therefore, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nificance. It is not open to this court to just consider the word to by ignoring prior . The word prior in the present context, not only denotes the flow of direction, but also actual date from which the period of 60 days is to be calculated. It is settled law that while interpreting a statute, it is not for the courts to treat any word(s) as redundant or superfluous and ignore the same. In this connection, it is pertinent to note the judgment of the Apex Court in Grasim Industries Ltd. v. Collector of Customs 2002 taxmann.com 1803, wherein, it was held as follows : 10. No words or expressions used in any statute can be said to be redundant or superfluous. In matters of interpretation one should not concentrate too much on one word and pay too little attention to other words. No provision in the statute and no word in any section can be construed in isolation. Every provision and every word must be looked at generally and in the context in which it is used. It is said that every statute is an edict of the legislature. The elementary principle of interpreting any word while considering a statute is to gather the mens or sententia legis of the legislature. Where the words ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng down the provision with the use of the word from , which denotes the starting point or period of direction in general parlance, would mean that 60 days from the last date . Even going by section 9 of the General Clauses Act, when the word from is used, then, that date is to be excluded, implying here that 31-12-2019 must be excluded. After excluding 31-12-2019, if the period of 60 days is calculated, the 60th day would fall on 1-11-2019 and the TPO must have passed the order on or before 31-10-2019 as orders are to be passed before the 60th day. Therefore, either way the contention of the Revenue is a fallacy and has no legs to stand. Mandatory or Directory 31. The next contention that has been raised by the learned senior standing counsel for the appellants is that the usage of the word may in section 92CA (3A) indicates that the time fixed is only directory, a guideline, not mandatory and is for the sake of internal proceedings. 32. Let us now examine the relevant procedures relating to Transfer Pricing. After an international transaction is noticed subject to satisfaction of section 92B, a reference is made to the TPO under sub-section (1) of section 92CA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reference is made and after availing the benefit of the extended period to pass orders, the department cannot claim that the time limits are not mandatory. Hence, the contention raised in this regard is rejected. 36. As rightly pointed out by Mr. Ajay Vohra, learned senior counsel for the respondents in WA. Nos.1148 and 1149/2021, the word may has to be sometimes read as shall and vice versa depending upon the context in which it is used, the consequences of the performance or failure on the overall scheme and object of the provisions would have to be considered while determining whether it is mandatory or directory. 37. At this juncture, it is noteworthy to mention the commentary of Justice G.P. Singh on the interpretation of statutes, Principles of Statutory Interpretation (1st Edn., Lexis Nexis 2015), which is quoted below for ready reference: 'The intention of the legislature thus assimilates two aspects: In one aspect it carries the concept of meaning i.e. what the words mean and in another aspect, it conveys the concept of purpose and object or the reason and spirit pervading through the statute. The process of construction, therefore, combines b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 018. Therefore, the order of the learned Transfer Pricing Officer is passed beyond this statutory time limit available and therefore, the order of the learned Transfer Pricing Officer is quashed 019. Now the issue is that when the transfer pricing order passed by the learned Transfer Pricing Officer is held to be invalid, therefore, there cannot be any variation as a consequent to the order of Transfer Pricing Officer. Therefore, the assessee ceases to be an 'eligible assessee' within the meaning of section 144C (15) (b) of the Act. The moment an assessee ceases to be an 'eligible assessee' in absence of valid transfer pricing order, the ld AO should not have passed the draft assessment order. Thus provision of section 144C does not apply to the assessee. Thus, the time limit for completion of the assessment reverts back to 21 Months from the end of the assessment year. Therefore, as held by the co-ordinate Bench in ATOS India Private Limited (supra), the final assessment order passed by the learned Assessing Officer on 26 th February, 2016 is also barred by limitation. Therefore, following the decision of the co-ordinate Bench, we quash the assessment orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as well as on the validity of the order of the learned Transfer Pricing Officer and Assessing Officer are also similar as made for AY 2011-12. 029. On careful consideration of the arguments of both the parties, we find that in this case the i. Return of income was filed on 30 November, 2016 for A.Y. 2016-17. ii. The time limit of 21 months is available from the end of the assessment year on 31 March, 2017 for completing the assessment. iii. Therefore, in normal circumstances, the assessment order should have been passed on 31 December 2018. iv. As the reference was made to the learned Transfer Pricing Officer, a further period of 12 months is available for completion of the assessment. Therefore, the time limit for passing final assessment order is available up to 31 December 2019. v. The order of the learned Transfer Pricing Officer was passed on 1 st November, 2019, the draft assessment order was passed on 26 th December, 2019 and final assessment order was passed on 9 th May, 2021. vi. As the time limit available for passing an assessment order is till 31-12-2019. But in case of an order to be passed under section 92CA of the Act, the time limit is 60 da ..... X X X X Extracts X X X X X X X X Extracts X X X X
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