DRP directions uploaded on ITBA portal with DIN are deemed received by AO/FAO on upload date; final assessment beyond one month from month-end is time-barred under section 144C(13).

ORDER

PER KESHAV DUBEY, JUDICIAL MEMBER:

This appeal at the instance of the assessee is directed against the order of ld. AO dated 29.7.2024 vide DIN: ITBA/AST/S/143(3)/2024-25/1067104239(1) passed u/s. 143(3) r.w.s. 144C(13) r.w.s. 144B of the Income Tax Act, 1961 (in short “the Act”) for the AY 2020-21.

2. The assessee has raised the following grounds of appeal:-

3. The assessee in the present case has also filed a petition on 21.3.2025 seeking admission of additional grounds, which are reproduced below for ease of reference & convenience:

3.1 We have heard both the parties on admission of additional ground. The Lucknow bench of the Hon’ble Allahabad High Court in the case of CIT Vs. Sahara India (2012) 347 ITR 331 held that a legal issue can be raised at any stage but there shall be good reason for admitting the additional ground. In our Opinion all the facts are already on record and there is no necessity of investigation of any fresh facts for the purpose of the adjudication of above ground. Further we are also of the opinion that the additional ground raised in the present case are purely legal in nature & therefore these are critical for a fair adjudication of the matter. The Hon’ble Madras High Court in the case of CIT Vs Indian Bank (2015) 230 Taxman 635 (Madras) held that Rule 11 of the I.T. Rules makes it clear that the assessee has the right to raise additional grounds and if the same is beneficial to the assessee, the same should be considered by the Tribunal.

3.2 Further, the Hon’ble Karnataka High Court in the case of Gundathur Thimmappa & Sons vs. CIT, Mysore, reported in (1968) 70 ITR 70 held that when the point raised by the assessee is a point which went to the root of the matter and affected not merely his liability to pay tax but also jurisdiction of the Tribunals and Authorities themselves to subject the amount concerned to tax, the Appellate Tribunal had the discretion to permit point of law to be raised for the first time in appeal because the question went to the root of the case. The Hon’ble Supreme Court in the case of National Thermal Power Co. Ltd. Vs CIT (1998) 229 ITR 383 held that undoubtedly, the Tribunal will have the discretion to allow or not allow a new ground to be raised. But where the Tribunal is only required to consider a question of law arising from the facts which are on record in the assessment proceedings, we fail to see why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee. Accordingly, we are inclined to admit the additional legal grounds for the purpose of adjudication as there was no investigation of any fresh facts otherwise on record and these are critical for a fair adjudication of the matter.

4. Since the assessee has raised the additional ground of appeal which is purely legal in nature, we deemed it fit & proper to first adjudicate this legal ground as raised by the assessee and if the necessity so desire, we will further proceed to adjudicate other grounds of appeal as raised by the assessee.

5. Now the brief facts of the case are that the assessee company is a wholly owned subsidiary of Koch Capabilities International Holdings, LLC. During the assessment year 2020-21, the assessee company provided IT support services to the entities within the Koch Group. The assessee company is compensated on a cost-plus markup of 10%. The assessee company filed its original return of income for the assessment year 2020-21 on 9.2.2021 declaring total income of Rs.11,87,46,830/-. The said return was thereafter processed u/s 143(1) of the Act. Subsequently, the case was selected for scrutiny under CA