JUDGMENT :

(P.S. Dinesh Kumar, J.)

This appeal by the Revenue challenging the order dated December 31st, 2018, passed in IT(TP)A No.832/Bang/2017 passed by the Income Tax Appellate Tribunal, Bengaluru (for short ITAT) has been admitted to consider following questions of law:

1. Whether on the facts and in the circumstances of the case, the Tribunal is right in law holding that entire assessment order as barred by time when the draft order and final assessment order were passed within time limit?

2. Whether on the facts and in the circumstances of the case, the Tribunal is right in law in holding that final assessment order as bad on the ground that assessing authority has not passed order as per directions of Dispute Resolution Panel?

3. Whether on the facts and in the circumstances of the case, the Tribunal is right in law in not following the decision of Hon'ble Punjab and Haryana High Court in the case of Des Kul Bhushan (reported in 47 Taxmann 79 (P&H) wherein it is observed that when an assessment order is set aside the limitation gets extended under Section 153(3) of the Act?

4. Whether on the facts and in the circumstances of the case, the Tribunal is right in law in holding that assessment order passed under Section 143(3) read with Section 144C(13) is bad in law even though the said order is passed according to parameters set out in said provision?

2. Shri. M. Dilip, learned Standing Counsel for the Revenue assailing ITAT's order submitted that Assessing Officer has passed the order in time and therefore the impugned order is unsustainable in law.

3. Shri.T.Suryanarayana, learned Senior Advocate for the assessee submitted that under Section 144C(10) of the INCOME TAX ACT , 1961 ('IT Act' for short) every direction issued by the Dispute Resolution Panel ('DRP' for short) shall be binding on the Assessing Officer and under Section 144C(13) the Assessing Officer is duty bound to pass the assessment order in conformity with the directions within one month from the end of the month in which such directions are received by the DRP. He argued that the Assessing Officer has recorded in the assessment order that on receipt of directions by the DRP, reference was made to Transfer Pricing Officer ('TPO' for short) for re-working the Arms Length Price (ALP). The Order Giving Effect (OGE) in respect of DRP's direction corrected with the TP adjustments were not received in time and the Assessing Officer has confirmed the draft assessment order and the same is in violation of Section 144C. The ITAT has rightly set aside the said order. With these submissions, he prayed for dismissal of this appeal.

4. We have carefully considered the rival contentions and perused the records.

5. The Assessing Officer has recorded thus in his order:

5. The DRP by its order dated 28,12.2016 gave certain directions to the TPO. The AO thereafter passed the impugned order without incorporating the directions given by the DRP dated 28.12.2016. The following were the relevant observations of the AO in the final order of assessment dated 31.01.2017, which is the order impugned in this appeal.

"Accordingly, adjustments as determined by the TPO to ALP of Rs. 40,11,77,583/- was added to the returned income of the assessee and draft assessment order was passed on 29.03.2016 under the provisions of section 144C of the Income-Tax Act,1961. The assessee based on the draft assessment order filed its objections before the Hon'ble DRP, Bangalore on 29.04.2016. The Hon'ble DRP vide its directions issued under section 144C(5) r.w.s. 144C(8) of the IT Act dated 28.12.2016 has given relief relating to the TP adjustment.

5. On receipt of direction of Hon'ble DRP a reference was made to