TMI Blog2024 (2) TMI 155X X X X Extracts X X X X X X X X Extracts X X X X ..... perusal of the impugned order it is palpable that the CIT has applied his mind and formed an opinion on the failures of the Assessing Officer in not referring the matter to the TPO. We find no force in the submissions of assessee that the CIT has adorned revisional powers merely on proposal forwarded by the AO. Hence, the first argument of the assessee assailing the impugned order is rejected. Non reference to the TPO - as argued AO had made a reference to the TPO, but the reference was returned by the TPO stating it to be time barred - A close examination of sequence of events tabulated above would show that the Assessing Officer had received the approval from the office of CIT on 09/03/2021 i.e. well before the last date for passing of the TP order i.e. 31/07/2021. AO went in slumber and held on to himself the approval from CIT for more than six months. In proceedings under the Act, time is the essence. Thereafter, on 20/09/2021 made reference to TPO, by that time the period to pass the order by the TPO u/s. 92CA(3) of the Act had already elapsed. As is evident from Office Memo the last date for passing the order for TPO was 31/07/2021. The reference made by Assessing Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n accordance with CBDT Instructions No.3 of 2016. On 09/03/2021 approval was received from the office of CIT for referring the case to TPO via ITBA Portal. On 20/09/2021 reference was made by the Assessing Officer to the TPO via ITBA Portal. On 24/09/2021 the TPO returned the reference stating that reference received is not valid considering CBDT s Internal Office Memorandum(F No.370142/24/2021-TPL), which provided that the last date to pass transfer pricing order was 31/07/2021 and the said date has elapsed, hence reference cannot be acted upon at this stage. Thereafter, the Assessing Officer on 12/10/2021 made proposal to CIT for initiation of proceedings u/s. 263 of the Act stating that (i) on ITBA Portal the time barring for Assessment Year 2018-19 is still showing as 30/09/2022, and (ii) the final assessment order is prejudicial to the interest of Revenue. 3. In the backdrop of aforesaid facts, the ld.Counsel for the assessee made two fold submissions: First, challenging validity of impugned order the ld.Counsel for the assessee submits that provisions of section 263 have been invoked by the CIT on proposal of Assessing Officer. The CIT has not formed his independent opi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on examination of the records .. . Thus, it is evident that the CIT has examined the records. Similar expression has been used in show cause notice u/s. 263 of the Act dated 17/12/2021. He further referred to para 2.2 of the impugned order wherein the CIT has used the expression, .it was prima-facie seen that the order passed on 16/11/2021 was erroneous and prejudicial .... . These expressions used in the impugned order clearly show that the CIT has not exercised revisional powers under section 263 of the Act in a mechanical manner but after examining the records has taken a conscious decision. 4.1 The ld. Departmental Representative further submitted that the reference made by the Assessing Officer to TPO was invalid. Therefore, the CIT used the expression no reference was made . The ld. Departmental Representative submitted that the case laws on which assessee has placed reliance are distinguishable on facts. In the case of Alfa Lavel Lund AB (supra), Multi Commodity Exchange Pvt. Ltd. (supra) and others, the CIT initiated proceedings u/s. 263 of the Act on mere reference/ proposal by the Assessing Officer without independent examination of records. Hence, the ratio lai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not mentioned that records were examined by him. Mere mentioning of the fact that the records were examined does not show that the records were in fact examined by the CIT. The ld. Counsel for the assessee finally submitted that the ITBA Portal shows time barring date for assessment as 30/09/2022. There is contradiction in the stand of the Department. The ld. Counsel for the assessee raised a question as to how reference is not a valid, if, system reflects 30/09/2022 as the last date for passing assessment order. He submitted that the cases/laws on which reliance has been placed by the ld. Departmental Representative are distinguishable. In the said cases no reference at all was made by the Assessing Officer to the TPO, whereas, in the present case the reference was made by the Assessing Officer to the TPO. The Revenue has created unwarranted dispute with regard to validity of reference. The ld. Counsel for the assessee thus, prayed for quashing the impugned order. 6. We have heard rival submissions and have examined orders of authorities below. The assessee has assailed the order of CIT on two counts. The first plank of argument of the assessee is that the CIT has exercised p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er is rejected. 8. The second plank of argument challenging validity of impugned order is that the Assessing Officer had made a reference to the TPO, but the reference was returned by the TPO stating it to be time barred. The CIT in the impugned order has observed that there was no reference by the Assessing Officer. Hence, jurisdiction u/s. 263 of the Act has been exercised on wrong appreciation of facts. Before we proceed further it would be relevant to refer to some of the dates: Date Events 01/03/2021 Letter from A.O to CIT(IT),Mumbai-3 requesting for approval for referring the case to the TPO. 09/03/2021 Approval received from the CIT for referring the case to TPO. 20/09/2021 A.O makes reference to the TPO via ITBA Portal. 24/09/2021 TPO returned the reference to A.O stating it to be invalid/time barred, hence, cannot be acted upon. Indeed, reference was made by the Assessing Officer to TPO, and the said reference was returned on the ground that it was not valid. The provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A, no extension Is granted by TOLA in such cases. The lime limit of final assessment order in cases is defined by the provisions, of the section 153 of the Act only and is, therefore, 30th September, 2021. (3) With regard to difficulties faced by the TP Officers in completing TP proceedings and passing TP orders by 31st July 2021. It is pertinent to reiterate that TOLA does not give the authority to extend the TP time barring date of 31.07,2021 for AY, 2018-19. The said time barring date can be extended only by means of an ordinance or a legislative amendment which is beyond the purview of the Board. [Emphasized by us] A perusal of the aforesaid Office Memo makes it clear that there is no extension of time for passing the TP order u/s. 92CA(3) of the Act by TOLA. 10. A close examination of sequence of events tabulated above would show that the Assessing Officer had received the approval from the office of CIT on 09/03/2021 i.e. well before the last date for passing of the TP order i.e. 31/07/2021. The Assessing Officer went in slumber and held on to himself the approval from CIT for more than six months. In proceedings under the Act, time is the essence. Thereafte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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