The Deputy Commissioner Of Income Tax Large Taxpayer Unit – 1 Nungambakkam Chennai – 600 034 v. Https://Hcservices.ecourts.gov.in/Hcservices

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 09.06.2022 CORAM : THE HONOURABLE MR. JUSTICE R. MAHADEVANANDTHE HONOURABLE MR. JUSTICE J.SATHYA NARAYANA PRASADWRIT APPEAL NOS.1517, 1519, 1609, 1610 AND 1854 OF 2021AND CMP. NOS.9656, 9658, 10022, 10023 AND 11720 OF 2021 W.A.Nos.1517 and 1519 of 2021 1.The Commissioner of Income Tax The Dispute Resolution Panel-2 BMTC Building, 80 Feet Road, 6[th] Block near KHB Games Village Koramangala, Bengaluru Karnataka – 560 0952.The Deputy Commissioner of Income Tax Large Taxpayer Unit – 1 Nungambakkam, Chennai – 600 034 ...AppellantsVersus M/s.Roca Bathroom Products Private Limitedrep. by its Managing Director Mr. K.E. RanganahanNo.62, 4[th] Floor, KGN TowersEthiraaj Salai, EgmoreChennai – 600 105 ...Respondent W.A.Nos.1609 & 1610 of 2021 1.The Dispute Resolution Panel-2 Kendriya Sadan, 4[th] Floor Koramangala, Bangalore – 560 034 2.The Deputy Commissioner of Income Tax Large Taxpayer Unit – 1 Nungambakkam Chennai – 600 034 ...Appellants Versus M/s.Roca Bathroom Products Private Limitedrep. by its Managing Director Mr. K.E. RanganahanNo.62, 4[th] Floor, KGN TowersEthiraaj Salai, Egmore, Chennai – 600 105 ...RespondentW.A.No.1854 of 20211.The Deputy Commissioner of Income Tax Corporate Circle-II (1) Room No.511, 5[th] Floor Main Building, Aayakar Bhawan 121, Uttamar Gandhi Road Nungambakkam, Chennai – 600 0342.The Secretary Dispute Resolution Panel – Panel – II 4[th] Floor, Kendriya Sadan Koramangala, Bengaluru – 560 034 ...AppellantsVersusM/s.Freight Systems (India) Private Limitedrep. by its National Head – Finance & AccountsMr. P. Vijaya KumarNew No.257, Old No.125/2Angappa Naicken StreetChennai – 600 001 ...RespondentPrayer in W.A.No.1517 of 2021 : Writ Appeal filed under Clause15 of The Letters Patent against the Order dated 23.12.2020passed in WP No.1068 of 2020 on the file of this Court.Prayer in W.P.No.1068 of 2020 : Writ Petition filed underArticle 226 of the Constitution of India praying to Writ ofCertiorarified Mandamus to call for the records in DIN andLetter No.ITBA/DRP/F/17/2019-20/1023641 753(1) dated 06.01.2020for the Assessment Year 2009-10 on the file of the 1[st]Respondent and quash the same and consequently direct the 2[nd]Respondent to issue the refund of the tax amount along withinterest in accordance with section 244A of the Income tax Act1961.Prayer in W.A.No.1519 of 2021 : Writ Appeal filed under Clause15 of The Letters Patent against the Order dated 23.12.2020passed in WP No.1070 of 2020 on the file of this Court.Prayer in W.P.No.1070 of 2020 : Writ Petition filed underArticle 226 of the Constitution of India praying to Writ ofProhibition to Prohibit the Respondents or any other Authority under the Income-tax Act to proceed further in relation to theAssessment Year 2009-10. Prayer in W.A.No.1609 of 2021 :- Writ Appeal filed under Clause15 of The Letters Patent against the Order dated 23.12.2020passed in WP No.922 of 2020 on the file of this Court. Prayer in W.P.No.922 of 2020 : Writ Petition filed under Article226 of the Constitution of India praying to Writ of Prohibitionfor a direction or order in the nature of writ to restraint therespondents or any other Authority under the Income Tax Act toproceed further in relation to the Assessment Year 2010-11. Prayer in W.A.No.1610 of 2021 : Writ Appeal filed under Clause15 of The Letters Patent against the Order dated 23.12.2020passed in WP No.919 of 2020 on the file of this Court. under the Income-tax Act to proceed further in relation to theAssessment Year 2009-10. Prayer in W.A.No.1609 of 2021 :- Writ Appeal filed under Clause15 of The Letters Patent against the Order dated 23.12.2020passed in WP No.922 of 2020 on the file of this Court. Prayer in W.P.No.922 of 2020 : Writ Petition filed under Article226 of the Constitution of India praying to Writ of Prohibitionfor a direction or order in the nature of writ to restraint therespondents or any other Authority under the Income Tax Act toproceed further in relation to the Assessment Year 2010-11. Prayer in W.A.No.1610 of 2021 : Writ Appeal filed under Clause15 of The Letters Patent against the Order dated 23.12.2020passed in WP No.919 of 2020 on the file of this Court. Prayer in W.P.No.919 of 2020 : Writ Petition filed under Article226 of the Constitution of India praying to Writ ofCertiorarified Mandamus to call for the records in DIN andLetter No.ITBA/DRP/F/17/2019-20/1023642401 (1) dated 06/01/2020for the Assessment year 2010-11 on the file of the 1[st]respondent and quash the same and consequently direct the 2[nd]respondent to issue the refund of the tax amount along withinterest in accordance with section 244A of the Income tax Act1961. Prayer in W.A.No.1854 of 2021 : Writ Appeal filed under Clause15 of The Letters Patent against the Order dated 16.02.2021passed in WP No.6202 of 2019 on the file of this Court. Prayer in W.P.No.6202 of 2019 : Writ Petition filed underArticle 226 of the Constitution of India praying for theissuance of Writ of Certiorarified Mandamus, to call for theFinal Assessment Order dated 29.10.2010 passed by the 1[st]respondent herein under Section 143(3) read with Section 144-C(13) of the Income Tax Act for the AY 2006-07 and quash the sameas the consequential proceedings in furtherance of theaforementioned Order dated 29.10.2010, pending before the 2[nd]respondent herein is barred by limitation in terms of Section153(2A) of the Act and consequentially direct the 1[st] respondentherein to grant a refund of Rs.4,72,88,068/- due to thepetitioner herein along with interest for delayed refund for aperiod from the said assessment year to the date of grant ofrefund. For Appellants :Mrs.Hema MuralikrishnanSenior Panel Counsel and Mr.Prabhu Mukunth Arunkumarin all the Writ Appeals For Respondents :Mr.R.V.Eshwar, Senior Counselfor Mr.R.Sandeep Bagmarin W.A.Nos.1517, 1519, 1609 & 1610/2021 Mr.Kamal Sawhney, Senior Counselfor Mr.Arun Karthick Mohanin W.A.No.1854 of 2021 COMMON JUDGMENT R.MAHADEVAN, J. The Revenue is the appellant(s) in all the appeals.WA.Nos.1517, 1519, 1609 and 1610 of 2021 have been filed againsta common order dated 23.12.2020 passed by the learned Judge inthe respective WP Nos.1068, 1070, 922 and 919 of 2020, whereasWA.No.1854 of 2021 arises from the order dated 16.02.2021 madein WP No.6202 of 2019. 2.The issues raised in all these writ appeals areidentical and inter-related to each other as the order in onebatch has been relied and followed in the other case. Thelearned counsel on either side have putforth common arguments inall the appeals. Therefore, all the writ appeals were taken upfor hearing together and disposed of by this common judgment. COMMON JUDGMENT R.MAHADEVAN, J. The Revenue is the appellant(s) in all the appeals.WA.Nos.1517, 1519, 1609 and 1610 of 2021 have been filed againsta common order dated 23.12.2020 passed by the learned Judge inthe respective WP Nos.1068, 1070, 922 and 919 of 2020, whereasWA.No.1854 of 2021 arises from the order dated 16.02.2021 madein WP No.6202 of 2019. 2.The issues raised in all these writ appeals areidentical and inter-related to each other as the order in onebatch has been relied and followed in the other case. Thelearned counsel on either side have putforth common arguments inall the appeals. Therefore, all the writ appeals were taken upfor hearing together and disposed of by this common judgment. 3.The respondent in these writ appeals namely WA Nos.1517, 1519, 1609 & 1610 of 2021 / M/s. Roca Bathroom ProductsPrivate Limited is a private limited company incorporated duringAugust 1983 and a subsidiary of Roca Sanitario S.A., Spain. Theyare engaged in the business of manufacturing and marketing ofbathroom products, such as, sanitary ware, tap fittings andother allied products. For the assessment year 2009-2010, theyfiled their return on 26.09.2009, declaring an income ofRs.21,44,96,661/-. Similarly, for the assessment year 2010-2011,they filed their return on 30.09.2010 declaring an income ofRs.50,75,32,362/-. The returns of income were taken up forscrutiny and were referred to Transfer Pricing Officer (inshort, “TPO”) under Section 92CA of The Income Tax Act, 1961 (inshort, “the Act”). 4.The TPO passed an order dated 23.01.2013 in respect ofassessment year 2009-2010, making a downward adjustment ofRs.4,66,00,000/- on import of goods. Following the same, theAssessing Officer passed a draft assessment order dated30.03.2013, in conformity with the adjustment proposed by theTPO and also made addition for (i)disallowance under Rule 14A(ii) disallowance on connectivity expenses and (iii)disallowance on unabsorbed depreciation of amalgamating company, https://hcservices.ecourts.gov.in/hcservices/ to which, the respondent submitted their objections before thefirst appellant / DRP and the Assessing Officer. However, theDRP rejected the same and confirmed the additions made in thedraft assessment order and issued directions under section 144C.Based on the same, the second appellant passed the finalassessment order on 16.01.2014 and raised a demand undersection 156 of Rs.1,46,07,560/-. 5.For the assessment year 2010-2011, the TPO passed anorder under Section 92CA of the Act on 29.01.2014, makingadjustment of Rs.19,38,25,457/- in respect of 3 issues viz., (i)downward adjustment on import of goods (ii) downward adjustmentof advertisement, marketing and promotion expenses and (iii)downward adjustment on interest paid on Compulsorily ConvertibleDebentures. Accordingly, the Assessing Officer passed a draftassessment order on 24.03.2014 in conformity with the adjustmentproposed by the TPO and also made addition for (i) disallowanceunder Rule 14A and (ii) disallowance on connectivity expenses.Aggrieved by the same, the respondent filed their objectionsbefore the first appellant / DRP, but the objections wererejected by the DRP and directions were issued under section144C. Based on the same, the second appellant passed the finalassessment order on 17.02.2015 and raised a demand under section156 of Rs.10,93,31,070/-. 6.Assailing the assessment orders relating to theassessment years 2009-2010 and 2010-2011, the respondentapproached the Income Tax Appellate Tribunal by filing appeals.By a common order dated 18.12.2015, the Tribunal allowed theappeals by setting aside the orders of the assessing officer andremanding the matter to the assessing officer to refer the sameto the DRP for fresh examination, after giving sufficientopportunity to the assessee. In respect of the assessment year2010-2011, the respondent/assessee filed Miscellaneous PetitionNo. 71/Mds/2016 stating that certain grounds raised by them havenot been adjudicated. By order dated 10.08.2016, the Tribunalallowed the Miscellaneous Petition and reopened the appeal inrespect of grounds 4 to 7 for fresh adjudication. Pursuant tothe same, the Tribunal by order dated 23.09.2016, allowed theappeal and directed the assessing officer to reexamine the issueafresh, after providing reasonable opportunity to the assessee. 7.According to the respondent, they did not receive anynotice, pursuant to the orders of the Tribunal and therefore,they sent a letter dated 21.08.2019 to the second appellantstating that the remand proceedings have become time barredunder Section 153 of the Act and hence, requested for refund ofthe tax already paid by them for the assessment years 2009-2010and 2010-2011 along with interest. Thereafter, they receivedseparate notices dated 06.01.2020 from the Dispute Resolution Panel (in short, “the DRP”) calling upon them to appear forenquiry on 10.01.2020. Stating that as per the orders of theTribunal, the assessing officer ought to have passed the draftassessment orders afresh, within the time limit prescribed undersection 153 of the Act, but he failed to do so and hence, thenotices dated 06.01.2020 issued by the first appellant arebarred by limitation, the respondent filed Writ Petitions toquash the notices dated 06.01.2020 and consequently, direct thesecond appellant to refund the tax amount along with interestunder section 244A of the Act and also restraining theappellants from proceeding further in relation to the assessmentyears 2009-10 and 2010-11. Panel (in short, “the DRP”) calling upon them to appear forenquiry on 10.01.2020. Stating that as per the orders of theTribunal, the assessing officer ought to have passed the draftassessment orders afresh, within the time limit prescribed undersection 153 of the Act, but he failed to do so and hence, thenotices dated 06.01.2020 issued by the first appellant arebarred by limitation, the respondent filed Writ Petitions toquash the notices dated 06.01.2020 and consequently, direct thesecond appellant to refund the tax amount along with interestunder section 244A of the Act and also restraining theappellants from proceeding further in relation to the assessmentyears 2009-10 and 2010-11. 8.According to the respondent in WA.No.1854 of 2021 viz.,M/s. Freight Systems (India) Private Limited, they are anassessee on the file of the Deputy Commissioner of Income Tax.For the assessment year 2006-07, they filed return of income on29.11.2006 and subsequently, filed revised return of income on19.10.2007. The return of income was taken up for scrutiny andwas referred to Transfer Pricing Officer under Section 92CA ofthe Act. The TPO passed an order on 31.10.2009 and based on thesame, the assessing officer passed a draft assessment order on31.12.2009, to which, the respondent/assessee filed theirobjections before the DRP/ first appellant and on 17.09.2010,the DRP disposed of the objections. Subsequently, the assessingofficer passed the final assessment order on 29.10.2010, whichwas put to challenge before the Income Tax Appellate Tribunal.The Tribunal, by an order dated 24.01.2013, remanded the matterback to the DRP by concluding that the freight forward segmenthad been omitted to be considered by the DRP. On remand, the DRPheard the respondent initially on 10.03.2014 and on severaldates. When the matter was pending on the file of DRP, Chennai,it was ordered to be transferred to DRP, Bangalore, a newlyconstituted division. After such transfer, no order has beenpassed and therefore, the respondent sent a representation tothe Chief Commissioner of Income Tax (International Taxation)Bangalore for annulment of the entire proceedings and for refundof the amount collected from them by placing reliance on Section153 of the Act. Thereafter, the respondent filed writ petitionNo. 6202 of 2019 to quash the final assessment order dated29.10.2020 passed under Section 143 (3) read with Section 144-C(13) of the Act and consequently direct the appellants to grantrefund of Rs.4,72,88,068/- along with interest. 9.Opposing the relief (s) sought for in the writpetitions, a counter affidavit was filed by the appellantscontending that the writ petition was filed on misconceptionthat the proceedings initiated by the department are barred bylimitation in respect of the assessment year 2009-2010. It iswell settled that the challenge made to show cause notice is not 9.Opposing the relief (s) sought for in the writpetitions, a counter affidavit was filed by the appellantscontending that the writ petition was filed on misconceptionthat the proceedings initiated by the department are barred bylimitation in respect of the assessment year 2009-2010. It iswell settled that the challenge made to show cause notice is not maintainable inasmuch as it is only a proposal to initiateaction and it has not finally determined the rights andliabilities of the parties to the writ. The respondent/assesseeought to have submitted their objections to the show causenotice and it is for the appellants to decide as to whether theproceedings are barred by limitation or not. Therefore, it wassubmitted that the writ petitions have been filed hastily andthe reliefs sought for need not be granted. It was alsosubmitted that the Assessing Officer was directed by the DRP tore-examine the issues and therefore, the provisions of Section153 of the Act would not be applicable to the present case,inasmuch as the DRP is not an authority within the purview ofSection 153 of the Act. Further, the Dispute Resolution Panel(DRP) is not an assessing officer against whom the time limitdoes not apply. As per Section 2 (7A) of the Act, the DRP is notan assessing officer and Section 144C (15) of the Act clarifiesthat the DRP is a collegium comprising of three PrincipalCommissioners or Commissioner constituted by the Board forresolution of the disputes. 10.The learned Judge, on examining the rival submissions,held that after the order of remand passed by the Tribunal, theAssessing Officer has not taken up the assessment proceedingswithin a reasonable time and therefore, the entire proceedingsare vitiated by reason of delay. Accordingly, by order dated23.12.2020, the learned Judge allowed WP Nos. 919, 922, 1068 and1070 of 2020 filed by the respondent/M/s. Roca Bathroom ProductsPrivate Limited with the following observations:- “11. There is no doubt in my mind that theorders of the Tribunal have not been given effect toin a proper manner by the Assessing Authority. TheTribunal, in the order for AY 2009-10, has set asidethe order of assessment directing the DRP to re-examine the issue afresh on the basis of availabledocumentation and after affording an opportunity tothe assessee. The direction is to the DRP though theDRP was not a party to the proceedings and only theJoint Commissioner of Income Tax, was arrayed asappellant/respondent in the appeals. The order of theTribunal has also not been marked to the DRP, ascopies are marked routinely only to theappellant/respondent/CIT(A)/CIT/DR/GF.Thisisperhaps the reason for the inaction of the DRP eventhough the direction of the Tribunal is specificallyaddressed to it. 12. As far as AY 2010-11 is concerned, theTribunal set aside the order of assessment andremanded the matter to the file of the AssessingOfficer, who, though being a party to the proceedingsdid nothing to give effect to the same. In my view, the proper course of action would have been for theAssessing Authority to have given effect to the orderof the Tribunal by way of a consequential order andthereafter taken proceedings up in accordance withthe procedure prescribed in Section 144C. However, itwas only after receipt of the petitioner'scommunication seeking a refund that the Departmenthas woken up, with the DRP issuing notices to thepetitioner for both years, though for AY 2010~11, thematter was remanded to the file of the AssessingOfficer. .... 12. As far as AY 2010-11 is concerned, theTribunal set aside the order of assessment andremanded the matter to the file of the AssessingOfficer, who, though being a party to the proceedingsdid nothing to give effect to the same. In my view, the proper course of action would have been for theAssessing Authority to have given effect to the orderof the Tribunal by way of a consequential order andthereafter taken proceedings up in accordance withthe procedure prescribed in Section 144C. However, itwas only after receipt of the petitioner'scommunication seeking a refund that the Departmenthas woken up, with the DRP issuing notices to thepetitioner for both years, though for AY 2010~11, thematter was remanded to the file of the AssessingOfficer. .... 15. No doubt, Section 144C is a self containedcode of assessment and time limits are inbuilt eachstage of the procedure contemplated. Section 144Cenvisions a special assessment, one which includesthe determination of Arms Length Price (ALP) ofinternational transactions engaged in by theassessee. The DRP was constituted bearing in mind thenecessity for an expert body to look into intricatematters concerning valuation and transfer pricing andit is for this reason that specific timelines havebeen drawn within the framework of Section 144C toensure prompt and expeditious finalisation of thisspecial assessment. 16. The purpose is to fast-track a specific typeof assessment. This does not however lead to theconclusion that overall time limits have beeneschewed in the process. In fact, the argument to theeffect that proceedings before the DRP are unfetteredby limitation would run counter to the avowed objectof setting up of the DRP a high powered andspecialised body set up for dealing with matters oftransfer pricing. Having set time limits every stepof the way, it does not stand to reason thatproceedings on remand to the DRP may be done atleisure sans the imposition of any time limit at all.17. Sub-section (13) to Section 144C, in myview, imposes a restriction on the Assessing Officerand denies him the benefit of the more expansive timelimit available under Section 153 to pass a finalorder of assessment as he has to do so within onemonth from the end of the month when the directionsof the DRP are received by him, even without hearingthe assessee concerned. 18. Barring this, I find nothing in the languageof Section 144C or 153 to lead me to the conclusionthat the latter is operated from the operation of theformer. The specific exclusion of Section 153 fromSection 144C(13) can be read only in the context of that specific sub~section and once again, reiteratesthe urgency that sets the tone for the interpretationof Section 144C itself. 19. The Bombay High Court, in PCIT V. LionBridge Technologies Pvt. Ltd. (260 Taxmann 273) wasdealing with a challenge to a final order ofassessment. It was held that such a final assessmentcould be made only if the draft assessment had beenforwarded by the Assessing Officer to the assesseewithin the time limit prescribed under Section 153(2A) of the Act. 20. In Lion Bridge (supra) the Income TaxAppellate Tribunal had set aside the order ofassessment and remanded the matter to the file of theAssessing Officer directing him to pass orders denovo. In appeals filed by the revenue under Section260A, the substantial question raised was “Whether onthe facts and in the circumstance of the case and inlaw, the Tribunal is correct in entertaining theobjection that the assessment order is withoutjurisdiction null and void and unenforceable?“ Whiledismissing the appeals, the Division Bench proceedson the basis that the draft assessment order ought tohave been passed within the time frame stipulatedunder Section 153(2A) of the Act, also supporting theconclusion arrived at by me. 20. In Lion Bridge (supra) the Income TaxAppellate Tribunal had set aside the order ofassessment and remanded the matter to the file of theAssessing Officer directing him to pass orders denovo. In appeals filed by the revenue under Section260A, the substantial question raised was “Whether onthe facts and in the circumstance of the case and inlaw, the Tribunal is correct in entertaining theobjection that the assessment order is withoutjurisdiction null and void and unenforceable?“ Whiledismissing the appeals, the Division Bench proceedson the basis that the draft assessment order ought tohave been passed within the time frame stipulatedunder Section 153(2A) of the Act, also supporting theconclusion arrived at by me. 21. In Nokia India Private Ltd. V. DCIT (298 CTR334) a Division Bench of the Delhi High Court heldthat where the matter had been remanded to bere~done, it would hardly make a difference as towhether the remand had been to the TPO or the DRP,thus indicating that the provisions of Section 144Cwere also governed by the limitation of time set outin Section 153 of the Act. 22. The issue before the Delhi High Courtconcerned the effect of Section 153(2A) in a matterwhere the Tribunal had remanded the assessment inrespect of five out of seven issues to the AssessingOfficer. Upon receipt of the order of the Tribunal,the Assessing Officer referred the transfer pricingissues to the TPO. The assessee took a stand that theTPO would be bound by the limitation prescribed underSection 153(2A) and requested the TPO to take theprovision into consideration in the proceedingsbefore him. The time limits under Section 153(2A)were however violated by the Department leading toWrit Petitions being filed by Nokia. In that context,the Court, while accepting the stand of the assesseethat the time limits specified in Section 153(2A)would apply, states as follows: “25. In the present case, of the sevenissues, the assessment in respect of five wasset aside and the issues remanded for a freshdetermination. Whether the remand was to theTPO or the DRP would not make a difference aslong as what results from the remand is afresh assessment of the issue. Clearly,therefore, the time limit for completing thatexercise was governed by Section 153 (2A) ofthe Act.” 23. It is brought to my notice that the aboveorder has not been accepted by the revenue and hasbeen challenged before the Supreme Court. Delay infiling the SLP has been condoned and leave grantedCivil Appeal in C.A.No.6755 of 2018 is pending thoughwithout any order of stay. 24. Nothing has been stated in the course of thearguments in this matter, to persuade me to take adifferent view from what I have already taken.Additionally, the Bombay High Court, in VodafoneIndia Services (P) Ltd., Vs. Union of India (361 ITR531), paragraph 47, states that the process beforethe DRP is a continuation of assessment proceedingsas only thereafter would a final appealableassessment order be passed.” 11.Similarly, while allowing WP No. 6202 of 2019 on16.02.2021, the learned Judge observed as follows:“7. Nothing has been stated in the course of thearguments in this matter, to persuade me to take adifferent view from what I have already taken.Additionally, the Bombay High Court, in Vodafone IndiaServices (P) Ltd., Vs. Union of India (361 ITR 531),paragraph 47, states that the process before the DRPis a continuation of assessment proceedings as onlythereafter would a final appealable assessment orderbe passed. 11.Similarly, while allowing WP No. 6202 of 2019 on16.02.2021, the learned Judge observed as follows:“7. Nothing has been stated in the course of thearguments in this matter, to persuade me to take adifferent view from what I have already taken.Additionally, the Bombay High Court, in Vodafone IndiaServices (P) Ltd., Vs. Union of India (361 ITR 531),paragraph 47, states that the process before the DRPis a continuation of assessment proceedings as onlythereafter would a final appealable assessment orderbe passed. 8. An alternative argument putforth is that evenif one were to take the view that the provisions ofSection 153 would not apply to the scheme ofassessments under Section 144C, Courts haveconsistently held that a reasonable limitation shouldbe read into provisions dealing with the finalisationof assessments and, by no stretch of the imagination,can seven years be construed to be a reasonableperiod. I agree, though there is really no necessityfor me to consider the alternate argument, in thelight of my having accepted the primary argument. 9. This Writ Petition is allowed. The impugnedfinal assessment order dated 29.10.2010 is quashed.There is a direction to R1 to refund the amountsremitted by the petitioner in connection with thedemand raised under the impugned order, along withapplicable interest in terms of Section 244A of theAct, within a period of four (4) weeks from today.” 12.(i) Mrs.Hema Muralikrishnan, learned senior panel counselappearing for the appellants would submit that the DRP isentirely governed by the provisions contained under Section 144-C of the Act. As per Section 144-C, the Assessing Officer shallforward a draft order of assessment to the eligible assessee, ifhe proposes to make any variation in the income or lossreturned, which is prejudicial to the interest of such assessee.On receipt of such draft order, the assessee shall file hisacceptance or objections and thereafter the Assessing Officershall complete the assessment on the basis of such draft order,if no objections are filed and based on the directions issued byDRP, if objections are filed. The Assessing Officer,notwithstanding anything contained in Section 153 or Section153B, shall pass assessment order under Section 144C(3) within amonth from the end of the month in which the period for filingobjections under sub-section (2) of Section 144C expires.Therefore, it is contended that Section 144-C has to beconsidered independently as far as DRP is concerned. Addingfurther, the learned counsel submitted that section 153 is agenus and section 144C is a specie which is independent.Firstly, the marginal note to Section 144-C states that“Reference to dispute resolution panel”and secondly, sub-section12 specifies the time limit which the DRP shall givesuggestions. Though under sub-section (5), the DRP can issuedirections only upon receipt of objections, the time limitmentioned under sub-section (12) begins from the month in whichthe draft order is forwarded to the assessee by the AssessingOfficer and not the month in which the assessee chooses to fileobjections. The significance of marginal note and beginning oftime limit is that the DRP's action begins only upon reference,which means an action initiated by the Assessing Officer. Suchreference is made when the Assessing Officer forwards the draftassessment order to the assessee. (ii) It is further submitted by the learned senior panelcounsel appearing for the appellants that when transfer pricingissues are involved and the matter is referred to TPO as perSection 92CA, the TPO shall pass an order after hearing theassessee, either confirming or modifying the arm's length pricebetween the associated enterprises. On receipt of such order, asper Section 144C of the Act, the Assessing Officer has to pass adraft assessment order after incorporating the adjustmentssuggested in the order of the TPO and also pass orders with respect to other issues. Thereafter the assessee has two options(i) he can file objections before the DRP against the draftassessment order or accept the assessment proceedings and (ii)if the assessee conveys his acceptance of the variations to theAssessing Officer, then the Assessing Officer can proceed topass a final order, against which, a remedy of appeal isavailable before the Commissioner of Income Tax. However, incase, the assessee objects to the draft assessment order beforethe DRP, then the DRP shall, after hearing the assessee, issuedirections to the Assessing Officer to complete the assessment,based on which the Assessing Officer has to complete theassessment proceedings. Such an order can be passed by theAssessing Officer, notwithstanding anything to the contrarycontained in Section 153 of the Act. Section 153 of the Actstipulates time limit for completion of assessment or re-assessment and re-computation by an assessing officer indifferent circumstances i.e., time limit for completion oforiginal assessment, completion of assessment on the basis ofthe order passed by the Commissioner under Section 263 or 264 ofthe Act or in compliance with the order of the AppellateAuthorities or Tribunal or the Court. Section 153 of the Act issilent with respect to the period of limitation, within whichtime, the assessment has to be made by the assessing officer onthe basis of the directions of the DRP. The time limit isspecifically excluded because the proceedings before the DRP aswell as the proceedings initiated on the basis of the directionsissued by DRP are separate and distinct. In this context,reliance was placed on Section 144C (13) of the Act, which readsas follows:- “Upon receipt of the directions issued undersub-section (5) the Assessing Officer shall, inconformitywiththedirections,complete,notwithstanding anything to the contrary containedin Section 153 or Section 153B, the assessmentwithout providing any further opportunity of beingheard to the assessee, within one month from the endof the month in which such direction is received.” (iii) By pointing out Section 144 C (13) of the Act, it issubmitted by the learned senior standing counsel for theappellants that the limitation prescribed under Section 153 ofthe Act applies only to a draft assessment order and not finalassessment order passed under Section 144C and that is thereason why the draft assessment orders are passed within aperiod of 33 months from the expiry of the relevant assessmentyear. Wherever assessment proceedings were dependent onextraneous data or extraneous proceedings like grant of interimstay of operation of initiation of the assessment proceedings orwhere accounts are to be audited, reference will be made to (iii) By pointing out Section 144 C (13) of the Act, it issubmitted by the learned senior standing counsel for theappellants that the limitation prescribed under Section 153 ofthe Act applies only to a draft assessment order and not finalassessment order passed under Section 144C and that is thereason why the draft assessment orders are passed within aperiod of 33 months from the expiry of the relevant assessmentyear. Wherever assessment proceedings were dependent onextraneous data or extraneous proceedings like grant of interimstay of operation of initiation of the assessment proceedings orwhere accounts are to be audited, reference will be made to Valuation Officer. In this context, Explanation to Section 153has extended the period of limitation by providing for exclusionof period. However, Section 153 is specifically silent withrespect to limitation in respect of cases pending before DRP andthis clearly shows that legislature has consciously refrainedfrom providing for limitation under Section 153 of the Act. Thus, the learned Judge erred in concluding that Section 144C(13) imposes a restriction on the Assessing Officer to pass thefinal order within the time limit available under Section 153 ofthe Act. According to the learned Senior Panel counsel, theperiod of 21 months indicated in Section 153 (1) of the Act fromthe end of the assessment year is for the purpose of completionof assessment, whereas, Section 153 (4) stipulates that wherereference under Section 92CA(1) of the Act has been made, theperiod for completion of assessment or re-assessment shall beextended by 33 months. This period of 33 months relates to draftassessment order and not final order. While so, the observationsmade by the learned Judge that the Assessing Officer ought tohave given effect to the order of the Tribunal by way of passingorder within the time limit prescribed under Section 144C of theAct, are contrary to the statute. (iv) The learned senior panel counsel also submitted thatthe Tribunal set aside the order of the DRP, as a consequence ofwhich, the Assessing Officer cannot take up the Arm's lengthprice adjustment. In such event, there would be absolutely noArms Price adjustment proceedings and consequently, the assesseewould not be aggrieved by the order. (v) The learned senior panel counsel for the appellants alsosubmitted that the decision of Bombay High Court in PrincipalCommissioner of Income Tax vs. Lion Bridge Technologies PrivateLimited [2019 (260) Taxman 273] has no application to the factsof the present case. In that case, the Bombay High Court did notconsider the effect of Section 144C (13) which specifically usesthe words “notwithstanding anything to the contrary contained inSec.153 or Sec.153B” but the Court had an occasion to considerwhether the Assessing Officer could, by issuance of aCorrigendum, convert a final assessment order into that of adraft assessment order. Similarly, the decision of the DelhiHigh Court in Nokia India Private Limited v. DCI [2018 (407) ITR20] is not applicable to the case on hand, where the Court hasnot considered the effect of Section 144C (13). Therefore, thereliance placed by the learned Judge on the aforesaid twodecisions is improper. In any event, when Section 153 of the Actdoes not apply to DRP and the Assessing Officer has no controlover DRP, it has to be construed that there is no time limitprescribed in the Act for the DRP to complete the proceedings.Therefore, Section 153 of the Act cannot be interpreted as if itimposes limitation to the Assessing Officer to pass orders upon remand of the matter by the Tribunal by obtaining order from DRPwithin the time prescribed under Section 153 of the Act. Theorder passed by the learned Judge, in effect, would meanprescribing a limitation of one month prior to the date on whichthe period specified in Section 153(2A) expires for completionof proceedings by the DRP, when such limitation has not beenprescribed by the legislature. The learned Senior Panel Counseltherefore prayed for allowing the writ appeals by setting asidethe order passed by the learned Judge. 13. (i) Mr.R.V.Eshwar, learned Senior counsel appearing forthe respondent in W.A. No. 1854 of 2021, at the outset, wouldcontend that challenging the order of assessment passed by theAssessing Officer, for the assessment year 2006-2007, therespondent filed an appeal before the Tribunal. By order dated24.01.2013, the Tribunal allowed the appeal, thereby settingaside the order of the Assessing Officer and remanding thematter to the DRP to decide the issue of TP adjustment to thetune of Rs.8,06,50,795/- in the Freight Forwarding Segment onthe file of DRP inasmuch as the Tribunal noticed that DRP hasnot at all adjudicated this issue. The order of remand waspassed with the consent of the counsel for the assessee as wellas the Revenue. The order dated 24.01.2013 was received by therespondent on 08.02.2013. On 19.02.2014, DRP, Chennai issued anotice to the respondent and initiated the remand proceedings.Subsequently, on 11.03.2014, 21.04.2014, 09.12.2014 and12.12.2014, the matter was heard by DRP, when the assesseeconcluded their contentions by filing written submissions. Atthis stage, by a notification dated 31.12.2014, the jurisdictionof the assessment proceedings stood transferred to the file ofDRP, Bengaluru. Thereafter, no order was passed in the remandproceedings. Even assuming that the DRP received the order dated24.01.2013 passed by the Tribunal in the appeal preferred by therespondent on 19.02.2014, on which date, a notice was issued tothe respondent for remand proceedings, the 12 months periodstipulated under Section 153 (2A) of the Act expired on31.03.2015. However, before 31.03.2015, no order has been passedby the DRP inspite of the fact that the matter was heard andwritten submissions were filed by the respondent. Therefore, anyorder or proceedings that may be initiated after 31.03.2015 isbarred by limitation. In other words, the 12 months period fromthe end of financial year 2013-2014 expired on 31.03.2015 withinwhich date, a final order in the remand proceedings ought tohave been passed. (ii) The learned Senior counsel for the respondent invitedthe attention of this court to the decision of the Delhi HighCourt in Nokia India Private Limited v. DCIT [(2018) 407 ITR 20]and submitted that the provisions contained under Section 152(3A) of the Act are applicable even to a remand proceedingspassed by the Tribunal, directing the DRP to adjudicate the issues afresh. In this case, pursuant to the order passed by theTribunal, remand proceedings were initiated by the DRP, Chennaiand subsequently, by notification dated 31.12.2014, thejurisdiction vested with DRP, Bengaluru. However, it cannot besaid that DRP, Chennai which initiated the remand proceedings,has no jurisdiction to adjudicate the issue or in thealternative, should have passed orders even earlier. While so,the appellants ought to have passed an order on or before31.03.2015 and any order passed subsequent thereto is hit bySection 153 (2A) of the Act. issues afresh. In this case, pursuant to the order passed by theTribunal, remand proceedings were initiated by the DRP, Chennaiand subsequently, by notification dated 31.12.2014, thejurisdiction vested with DRP, Bengaluru. However, it cannot besaid that DRP, Chennai which initiated the remand proceedings,has no jurisdiction to adjudicate the issue or in thealternative, should have passed orders even earlier. While so,the appellants ought to have passed an order on or before31.03.2015 and any order passed subsequent thereto is hit bySection 153 (2A) of the Act. (iii) The learned Senior counsel also submitted that evenassuming that Section 153(2A) does not provide any limitation,it is a settled law that in case where no limitation isprescribed for discharge of certain acts or duties, theauthority expected to discharge such duty, has to conclude theproceedings within a reasonable time and the person against whomsuch proceedings are initiated, will also have a legitimateexpectation to get the proceedings concluded at the earliestpoint of time. In the present case, there was inordinate delayin passing the final order in the remand proceedings which hascaused acute prejudice to the respondent. Taking note of thesame, the learned Judge rightly held that non-obstante clause inSection 144C (13) is to exclude the application of Section 153only in the context of passing final assessment order. It wasfurther held that this is not a general exclusion of Section 153of the Act at every stage of the proceedings and the non-obstante clause just ensures that the limitation prescribed forpassing of final order as provided in Section 153, does notapply at the beginning and the final order is to be passed afterthe directions are issued to the DRP by the Tribunal. (iv) The learned senior counsel further submitted that theDRP has sat over the remand proceedings for more than six yearsand therefore, it is precluded from passing any further orderagainst the assessee in the remand proceedings. The learnedSenior counsel placed reliance on the decision in GE T&D IndiaLimited v. Deputy Commissioner of Income Tax [(2019) 105Taxmann.com 286 (Madras) = (2019) 414 ITR 727 (Madras)] whereinthis Court has annulled the assessment proceedings by pointingout that there is an extraordinary delay of 8 years inconcluding the assessment proceedings. The ratio laid down bythis Court in the said case squarely applies to the facts of thepresent case as well. (v) The learned Senior counsel also placed reliance on thedecision of the Delhi High Court in Commissioner of Income Taxv. Goyal MG Gases Private Limited (Order dated 23.02.2011 in ITANo.335/2011) wherein in similar circumstances, it was held thatthe delay of 3 years and 8 months in passing a final order ismore than reasonable period and therefore, the order passedthereof is hit by the limitation prescribed under the Act. Asagainst the said order dated 23.02.2011, an appeal in SLP (c) No. 26766 of 2011 was filed by the Department and the same wasdismissed by the Hon'ble Supreme Court on 19.09.2021. Thelearned senior counsel also relied upon the Judgment in VedantaLtd v. DCIT [(2020) 114 taxman.com 686] to buttress thecontention that the very object of DRP mechanism is to expeditethe assessment proceedings involving transfer pricing andforeign companies. By placing reliance on the aforesaid decisionand other decisions, which emphasize the strict adherence to theperiod of limitation for assessment or revision of assessment,it is submitted by the learned Senior counsel that there isenormous delay in passing a final order pursuant to the order ofremand passed by the Tribunal on 24.01.2013. The learned Judge,on appreciation of the said aspects has rightly allowed the writpetition filed by the respondent and it calls for nointerference by this court. 14.(i) Mr. Kamal Sawhney, learned senior counsel appearingfor the respondent in WA Nos. 1517, 1519, 1609 & 1610 of 2021would contend that the appellants are not legally justified innot passing a final order in the remand proceedings within areasonable time. According to him, the order passed by the TPOis binding on the Assessing Officer in ter