JUNIPER NETWORKS INTERNATIONAL B.V,MUMBAI vs. DCIT (IT) CIRCLE-3(1)(1), MUMBAI

This is an appeal preferred by the assessee against the order of the Assessing Officer (AO) dated 31.01.2023 passed u/s 143(3)/263 of the Income Tax Act, 1961 (hereinafter “the Act”) after giving effect to the Dispute Resolution Panel (DRP) direction u/s 144C(5) of the Act.

First, we will deal with the legal issue raised by assessee wherein it challenges the jurisdiction of the AO to have framed assessment u/s 143(3)/144C(1)/263 of the Act. According to assessee, by passing the impugned assessment order, AO had given effect to the revisional order of Ld. CIT u/s 263 of the Act; and since this Tribunal has quashed the Ld CIT order u/s 263 of the Act, the impugned action

Brief facts are that the assessee had filed its return of income for AY. 2014-15 on 28.11.2014, and revised the same on 30.03.2016 and claimed refund of Rs.8,16,40,560/-. The AO passed the original assessment order on 30.06.2017 accepting the revised return of income filed by the assessee. Subsequently, the Ld. CIT(IT)-3, Mumbai issued show cause notice to the assessee intimating his desire to invoke the revisional jurisdiction u/s 263 of the Act in respect of the action of AO dated 30.06.2017. And after hearing the assessee, the Ld. CIT(IT) vide order dated 31.03.2021 passed u/s 263 of the Act canceled the original assessment order dated 30.06.2017 and directed the AO to frame fresh assessment in accordance to law. The assessee challenged the action of the Ld. CIT(IT) passed u/s 263 of the Act dated 31.03.2021 and the Tribunal was pleased to quash the Ld. CIT order passed u/s 263 of the Act inter-alia on jurisdiction by order dated 05.08.2022 [ITA No 982/Mum/2021 for AY 2014-15]. In the aforesaid factual background, according to the Ld. AR of the assessee, since the foundation on the basis of which AO framed the impugned reassessment has been quashed, all consequent actions including passing of draft assessment order dated 31.03.2022 and DRP direction dated 20.10.2022 & 07.11.2022 as well as the passing of the impugned assessment order

Per contra, the Ld. CIT-DR appearing for the revenue supported the action of the AO passing the re-assessment order u/s 144C/143(3)/263 of the Act dated 31.01.2023 and drew our attention to the fact that the assessee has raised similar objection before the Ld. DRP; and the Ld. DRP had discussed the objection of the assessee from page no. 139 of its order at para no. 8.2, and noted that the action of Tribunal quashing the Ld. CIT’s order u/s 263 of the Act dated 05.08.2022 has been challenged by revenue before the Hon’ble Bombay High Court on 24.03.2023 and the same is pending admission before the Hon’ble High Court. On a specific query from bench as to whether there is any stay ordered by the Hon’ble High Court against the operation of the order of Tribunal quashing the Ld. CIT(IT)-3, order dated 31.03.2021 passed u/s 263 of the Act, the Ld. CIT-DR submitted that there is no such interim order passed by Hon’ble High Court. Thus, we note that there is no impediment/stay against the operation of the order of this Tribunal dated 05.08.2022 quashing the Ld. CIT(IT)-3, order passed u/s 263 of the Act dated 31.03.2021.

After hearing both parties, we note that the aforesaid relevant facts to adjudicate the legal issue are not disputed, so it is not repeated for the sake of brevity. From the discussion (supra), it is clear that the AO had initiated the re-assessment proceedings which culminated in framing the impugned re-assessment order dated 31.01.2023 [u/s

In the result, the appeal of the assessee is allowed. Order pronounced in the open court on this 21/11/2023.