Assessment orders issued beyond statutory limits are invalid and void-ab-initio, reinforcing timely compliance with statutory provisions.

आदेश / ORDER

Manoj Kumar Aggarwal (Accountant Member)

1. Aforesaid appeal by assessee for Assessment Year (AY) 2016-17 arises out of the order of learned Commissioner of Income Tax (Appeals)-16, Chennai [CIT(A)] dated 23-03-2023 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) r.w.s 144C(3) of the Act on 28-02-2020. The assessee is aggrieved by disallowance u/s 14A; disallowance u/s 35(2AB) and disallowance u/s 2(24) r.w.s. 36(1)(va).

2. From the facts, it emerges that the assessee filed its return of income for this year on 30-11-2016. A reference u/s 92CA of Income Tax Act was made to Ld. Transfer Pricing Officer 2(2), Chennai wherein Ld. TPO, vide order dated 01-11-2019, proposed certain transfer pricing (TP) adjustment. Pursuant to the same, Ld. AO framed an assessment u/s 143(3) r.w.s. 144C(3) on 28-02-2020. Upon further appeal, Ld. CIT(A) partly allowed the appeal of the assessee against which the assessee is in further appeal before us.

3. The Ld. AR, at the outset, tabulated the sequence of assessment proceedings to demonstrate that the assessment order is time barred and accordingly null and void. The submissions made by Ld. AR read as under: - Since the transfer pricing proceedings were barred by limitation of time, the order dated November 01, 2019 is void-ab-initio and accordingly, the transfer pricing adjustment is non-est. Consequently, the Appellant cease to be an eligible assessee as defined under section 144C(15)(b) of the Act and therefore, the machinery provisions of Section 144C of the Act would not get triggered in the Appellant's case.

Accordingly, the assessment in the case of the Appellant ought to have been completed within 33 months from the end of the Assessment year as per Section 153 (1) read with Section 153 (4) of the Act, i.e., on or before December 31, 2019.

However, since the assessment was concluded vide the final assessment order dated February 28, 2020, the impugned assessment is clearly barred by statutory limitation.

Accordingly, the impugned assessment for the subject year is null and void-ab-initio.

In this regard, the Appellant relies upon the following rulings of this Hon'ble Tribunal, wherein the above position was upheld for the same assessment year:

M/s Verizon Data Services India Pvt Ltd ((TS-825-ITAT-2022(CHNY)-TP)) M/s.Eaton Power Quality (P.) Ltd. (152 taxmann.com 258) M/s.Durr India Pvt. Ltd. (2023 (8) TMI 714)

It is also pertinent to note that the above position has been upheld by the Coordinate Tribunals in the following cases:

Shell India Markets Pvt. Ltd. (Mumbai ITA T- ITA No.2933 and 3016/Mum/2016 Atos India Pvt. Ltd. , (Mumbai ITA T - ITA No. 1795/Mum/2017) Colgate-Palmolive (India) Limited (Mumbai ITA T- ITA No. 3488/Mum/2016)

Tata AIA Life Insurance Company Lim