Case Law Details
Bechtel Limited Vs ACIT (ITAT Delhi)
ITAT Delhi held that AO is bound to follow the directions of DRP. Accordingly, final assessment order passed by AO without implementing direction of DRP makes the assessment order void-ab-initio.
Facts- Vide the present appeal, the appellant has filed an additional ground mainly contesting the validity of the final assessment orders on the ground of non-implementation of the directions of learned DRP.
Conclusion- Hon’ble Jurisdictional High Court in the case of M/s. ESPN Star Sports Mauritius S.N.C. ET Compagnie Vs. Union of India has held that non-implementation of directions of DRP in terms of section 144C renders the final assessment order wholly without jurisdiction and void-ab-initio.
Held that we have come across several cases of such non-implementation of directions of learned DRP by the Assessing Officer while passing final assessment orders. There is no gainsaying that in the hierarchy of tax administration, the DRP holds higher position than the Assessing Officer. Therefore, for that reason and as per statutory mandate, the Assessing Officers are bound to follow the directions of DRP. Non-implementation of the directions issued by DRP, either consciously or due to non- application of mind by the Assessing Officers often put the department in an embarrassing situation as the learned counsels appearing for the Revenue find it difficult to defend the action of the Assessing Officers. Such repeated instances of non-implementation of directions of learned DRP by the Assessing Officers expose lack of proper orientation and training. We hope and expect that the authorities concerned would look into this aspect and address the issue with the seriousness it deserves.
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