Assessment Order Passed Beyond Sec 144C(4) Is Time Barred If Objections To Draft Order Were Filed After Expiry Of Limitation As Per Sec 144C(2): Delhi ITAT

Noticing that the draft assessment order was passed on Mar 4, 2022 and the assessee filed objection before the DRP on Apr 6, 2022 which was beyond the due date provided for filing objection, the Delhi ITAT held the assessment order to be time-barred being passed beyond Section 144C(4) of Income tax Act, 1961 time-limit.

The ITAT Coram comprising of Challa Nagendra Prasad (Judicial Member) and Dr. B.R.R. Kumar (Accountant Member), observed that “The draft of the Assessment Order, in this case, has been passed on 04 .03.202. The assessee file d objections before DRP on 06.04 .2022, i.e., after the due date of the time allowed for filing of the objections before the ld. DRP. The due date for passing of the final Assessment Order was 31.0 5.2022. Since the final Assessment Order has been passed on 27.12.2022 in divergence to due date prescribed u/s144C of the Income Tax Act, we hold that, the order passed by the Assessing Officer is barre d by limitation, and hence, treated as void”. (Para 3)

The Appellant contended that the final order passed by the AO was barred by limitation on being in contravention of the provisions of Section 144C(4) to mandatorily pass the assessment order within one month from the end of the month in which the statutory period of filing of the objections expired.

The Coram noted that the final assessment order should have been passed on May 31, 2022 but it was actually passed on Dec 27, 2022.

The Coram further observed that the passing of assessment order was in divergence with the due date prescribed under Section 144C, and hence, barred by limitation.

Therefore, the ITAT allowed the assessee's appeal and remarked that the AO should have carried the proceedings to finalize the assessment order as per the provisions of section 144C(4).

Counsel for Appellant: Manuj Sabharwal

Counsel for Respondent: Vizay B. Vasanta

Case Title: Mavenir UK Holdings verses ACIT

Case Number: ITA No. 185/Del/2023

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