Enfinity Solar Solutions Pvt Ltd Vs DCIT (Madras High Court)
Overview- The Madras High Court held that a fresh draft assessment order under Section 144C is mandatory even after ITAT remand, and failure to issue it renders the final assessment order invalid and without jurisdiction.
The present writ appeal stems from an assessment proceeding involving a private limited company engaged in the business of solar power installations. Pursuant to scrutiny and reference to the Transfer Pricing Officer (TPO) under Section 92CA of the Income Tax Act, certain adjustments were proposed to the international transactions of the assessee. On appeal, the Income Tax Appellate Tribunal (ITAT) remanded the matter to the TPO with specific directions to re-evaluate the Arm’s Length Price using an appropriate method and to examine whether any benefit accrued to the associated enterprises. Following this, the Assessing Officer passed a final assessment order without issuing a Draft Assessment Order under Section 144C(1). The assessee challenged this non-compliance by way of a writ petition, which was dismissed by the learned Single Judge on the ground that the remand by ITAT was limited in scope and did not warrant the issuance of a fresh draft order. Aggrieved by this finding, the assessee has preferred the present writ appeal.
