Luminous Power Technologies Private Ltd. Vs Deputy Director of Income Tax (ITAT Delhi)
Technical? No — Mandatory – One-Month Rule is Absolute-. Delay Under 144C(13) Is Fatal- ITAT Quashes Delayed DRP Final Orders as Time-Barred
Delhi Tribunal examined whether the Final Assessment Orders u/s 143(3) r.w.s.144C(13) were passed within the statutory time limit. Assessee pointed out that DRP issued directions on 04.03.2022 & therefore AO was mandatorily required u/s 144C(13) to pass the final order within one month from end of month of receipt, i.e., on or before 30.04.2022. However, AO passed the final orders only on 15.05.2022 & 18.05.2022. Assessee relied on several decisions including Louis Dreyfus, Fiberhome India, Sterling Oil, Rapiscan Systems, Ramco Cements, Hyundai Rotem, Rio Tinto & Microsoft India to show that any final order passed beyond the timeline is void & non est.
Revenue argued that Assessee should not escape tax liability on a technicality. Tribunal rejected this contention, holding that Section 144C(13) prescribes a mandatory, jurisdictional time limit. Once DRP issues directions, AO must complete assessment strictly within the prescribed period. Passing the order even a day late renders it invalid. Tribunal noted that jurisdictional High Court in Louis Dreyfus has clearly held that such delayed orders cannot survive. As both final orders for AYs 2017-18 & 2018-19 were admittedly passed after 30.04.2022, Tribunal held them to be time-barred & without legal force. Both assessment orders were therefore set aside & the Assessee’s appeals were allowed.
