ITAT Delhi Quashes DRP Assessments Passed Beyond Limitation

ITAT Delhi Quashes DRP Assessments Passed Beyond Limitation

AECOM India Pvt. Ltd. filed appeals for AYs 2010-11 and 2011-12 before the Delhi ITAT challenging the validity of final assessment orders passed under Section 144C(13) read with Section 153 of the Income-tax Act.

The assessee raised an additional legal ground contending that the assessments were barred by limitation. The Revenue objected to adjudication, contending that the issue is pending before the SC due to a split verdict in Shelf Drilling Ron Tappmeyer Ltd. and interim directions restraining reliance on that judgment as precedent.

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Main Issue: Whether final assessment orders passed under Section 144C(13), after following the DRP route, are time-barred if not completed within the limitation prescribed under Section 144C read with Section 153 of the Act.

ITAT’s Ruling: The ITAT rejected the Revenue’s preliminary objection and held that there was no bar on adjudicating the issue, as the Roca Bathroom Products judgment was not stayed.

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The Tribunal followed the ratio of the Madras High Court and held that Sections 144C and 153 are not mutually exclusive but mutually inclusive. Since the final assessment orders for AYs 2010-11 and 2011-12 were passed beyond the permissible limitation period, they were held to be without jurisdiction and were quashed. The Tribunal clarified that the appeals may be revived if the Supreme Court later reverses the law laid down in Roca Bathroom Products.

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