Shakti Hormann Private Limited Vs DCIT (ITAT Hyderabad)
144C Is Not a Time-Extender: TP Assessment Quashed as Time-Barred- Draft Order in Time Won’t Save Final Order: DRP Route Can’t Beat Section 153;
The Hyderabad ITAT allowed the Assessee’s appeal on the legal issue and quashed the final assessment order as time-barred, holding that limitation prescribed u/s 153 prevails over the procedure u/s 144C.
In the present case, despite reference to the TPO u/s 92CA and issuance of draft assessment order u/s 144C(1) on 26-09-2023, the final assessment order u/s 143(3) r.w.s. 144C(13) & 144B was passed only on 25-07-2024, whereas the outer limitation expired on 30-09-2023 (even after TP extension).
The Tribunal, relying heavily on Madras HC in Roca Bathroom Products Pvt. Ltd. and Bombay HC in Shelf Drilling Ron Tappmeyer Ltd., reiterated that Sections 144C & 153 are mutually inclusive, and the non-obstante clause in Section 144C(13) cannot extend statutory limitation. Passing a draft order within time does not save a final order passed beyond limitation.
Following its own Coordinate Bench decision in Aveva Solutions India LLP, the Tribunal held that once the final order is barred by limitation, it is void ab initio. All TP adjustments on royalty, interest on CCDs & interest on receivables were left open, with liberty to revive the matter depending on the outcome of the pending Larger Bench decision of the Supreme Court on the limitation vs. DRP issue.
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
