Achampet Solar Private Ltd. Vs ITO (ITAT Delhi)
The appeal challenged the final assessment order dated 22-02-2022 passed under Section 143(3) read with Section 144C of the Income Tax Act following the directions of the Dispute Resolution Panel (DRP) dated 14-12-2021. The assessee originally raised grounds against the transfer pricing adjustment relating to management fees of Rs. 1,03,95,878, the rejection of its transfer pricing study, application of the Comparable Uncontrolled Price (CUP) method, capitalization of the management fee, and retention of an adjustment relating to loan repayment despite the Transfer Pricing Officer’s consequential order.
During the proceedings before the Tribunal, the assessee filed an application under Rule 11 of the Income Tax (Appellate Tribunal) Rules, 1963, seeking admission of additional legal grounds. It contended that the final assessment order was barred by limitation under Section 144C(13) and that the assessment order had also been passed in non-conformity with the binding directions of the DRP. The assessee relied upon judicial precedents, including decisions of the Supreme Court, to submit that the Tribunal has the power to admit additional legal grounds where they arise from facts already on record and are necessary for correctly determining the tax liability. The Tribunal admitted the additional grounds.
