CORTEVA AGRISCIENCE SERVICES INDIA PRIVATE LIMITED,HYDERABAD vs. DCIT., CIRCLE 1(1), HYDERABAD

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ITA 339/HYD/2025Status: DisposedITAT Hyderabad22 July 2026AY 2017-1819 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the Draft Assessment Order was passed beyond the limitation period as per Section 153(5A) of the Act. The Tribunal quashed the Draft Assessment Order, rendering subsequent proceedings invalid.

What were the facts?

The assessee challenged the validity of the Assessing Officer's order, arguing it was passed beyond the limitation period prescribed under Section 153(5A) of the Income Tax Act. The dispute revolved around when the Assessing Officer was deemed to have received the Transfer Pricing Officer's order.

What were the issues?

Whether the Assessing Officer passed the Draft Assessment Order within the time limit stipulated by Section 153(5A) of the Income Tax Act, considering the date of receipt of the Transfer Pricing Officer's order.

Which sections of the Income-tax Act were involved?

Section 153(5A),Section 263,Section 92CA,Section 144C(13)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD

Before: SHRI VIJAY PAL RAO & SHRI MANJUNATHA G

For Respondent: DR Seema Meena
Pronounced: 22.07.2026

आदेश / ORDER PER VIJAY PAL RAO, VICE PRESIDENT: This appeal by the Assessee is directed against the Order dated 24.12.2024 passed by the Assessing Officer to give effect to the Directions of Disputes Resolution Panel-1 [in short “DRP”], Bengaluru, dated 25.11.2024, for the assessment year 2017-2018.

2.

The Assessee has raised the following grounds of appeal:

3.

In Ground no.1 the assessee has challenged the validity of the order passed by the Assessing Officer in pursuance to the Directions of the DRP being barred by limitation as per the provisions of sec.153(5A) of the Income Tax Act [in short "the Act"], 1961.

4.

The learned Authorised Representative of the Assessee has submitted that in pursuance to the Order passed u/sec.263 of the Act dated 27.03.2023 the TPO has passed an Order u/sec.92CA(3) of the Act on 31.05.2023. The said order was uploaded by the TPO on the ITBA Portal on 31.05.2023 itself as per the screen shot of ITBA portal placed at page-572 of the paper book and the same was also sent by the TPO through email dated 01.06.2023 to the Assessing Officer. Therefore, as per the limitation provided u/sec.

153(5A), the Assessing Officer was required to pass Draft Assessment Order within two months from the end of the month in which the Order of the TPO is received whereas the Assessing Officer has passed the Draft Assessment Order on 14.02.2024 which is barred by limitation and liable to be quashed. The learned Authorised Representative of the Assessee has also referred to the information sought by the assessee under RTI which was provided vide Order dated 10.04.2026 by the JCIT, Circle-1, Hyderabad wherein it has been acknowledged that the TP order dated 31.05.2023 was forwarded by the TPO via webmail to the JAO on 13.06.2023 and the said order was also uploaded on ITBA Portal on 31.05.2023 itself. It is also acknowledged by the department that the TP Order dated 31.05.2023 was received by the assessee on 01.06.2023 therefore, the learned Authorised Representative of the Assessee has submitted that once the order was received by the Assessing Officer on 01.06.2023 and thereafter via mail on 13.06.2023 then, the limitation of two months would expire on 31.08.2023 whereas the Draft Assessment Order was passed by the Assessing Officer on 14.02.2024 which is barred by limitation as provided u/sec.153(5A) of the Act. In support of his contention, he has relied upon the decision of this Tribunal in the case of Dr. Reddy’s Laboratories Ltd., vs. ACIT [2026] 186 taxmann.com 414 [Hyderabad – Trib.] and submitted that the Tribunal after considering the contention of the Department that the limitation would reckon only from the receipt of the physical copy of the directions of the DRP and not the direction received through mail or ITBA portal, the Tribunal has held that once the directions are delivered to the Assessing Officer through digital mode, the limitation would reckon from the end of the month in which the directions were received by the Assessing Officer.

5.

On the other hand, the learned DR has submitted that as per the order sheet the Order of the TPO was brought before the Assessing Officer only on 13.02.2024 and thereafter, the Assessing Officer passed the Draft Assessment Order on 14.02.2021. Thus, the learned DR has submitted that there is no delay after the Order of the TPO was taken- up by the Assessing Officer for Draft Assessment Order.

6.

We have considered the rival submissions as well as relevant material on record. In the case of the assessee originally the TPO passed order u/sec.92CA(3) of the Act on 31.01.2021 which was taken up for revision u/sec.263 of the Act by the CIT-[IT & TP], Hyderabad. The order of the TPO was revised u/sec.263 vide order dated 27.03.2023 and consequently, the TPO has passed revised TP order dated 31.05.2023. Therefore, the provisions of sec.153(5A) would be applicable in the case of the assessee for passing the Draft Assessment Order by the Assessing Officer as it was in pursuance to the revision order passed u/sec.263 of the Act. There is no dispute that the TPO uploaded the order dated 31.05.2023 on ITBA Portal on the same date and also sent email to the Assessing Officer on 01.06.2023. Thus, the facts are not in dispute as also evident from the record. Further, the assessee has obtained the information under RTI Act which is provided by the Department vide letter dated 10.04.2026 as under:

6.1. From the above it is clear that the Department has acknowledged the fact that the TP order dated 31.05.2023 was forwarded by the TPO via webmail to the JAO on 13.06.2023 and it was also uploaded on the ITBA Portal on 01.06.2023. Therefore, even if it is considered that the JAO received the order of the TPO via webmail on 13.06.2023 the limitation of two months for passing the Draft Assessment Order would reckon from the end of the month of June, 2023 and would expire on 31.08.2023. For ready reference, we quote sec.153(5A) of the Act as under:

“(5A). Where the Transfer Pricing Officer gives effect to an order or direction under section 263 by an order under section 92CA and forwards such order to the Assessing Officer, the Assessing Officer shall proceed to modify the order of assessment or reassessment or re-computation, in conformity with such order of the Transfer Pricing Officer, within two months from the end of the month in which such order of the Transfer Pricing Officer is received by him.”

6.2. Therefore, the limitation provided u/sec.153(5A) is applicable in the case as the orders were passed in pursuance to the revision order passed by the CIT u/sec.263 of the Act. The DRP has rejected this objection of the assessee in Para hno.2.4.2 as under:

“2.4.2. Regarding the claim of limitation u/s. 153, we are of the view that this case is covered u/s 153(3) of the IT Act, 1961. Further, the order u/s 263 of the act was passed on 27.03.2023, if it assumed that order was served on same day, the time line for completion of draft assessment become 31.03.2024. Therefore, the draft order dated 14.02.2024 is well within the permissible timeframe. Thus, the objection of the Assessee on this ground lacks any merit in it.”

6.3. Thus, the DRP has not considered the limitation provided u/sec.153(5A) of the Act rather considered the limitation provided u/sec.153(3) which is not applicable in case an order to be passed in pursuance to the revision order u/sec.263 of the Act. Hence, considering the undisputed facts that the Assessing Officer-JAO received the order on 13.06.2023, the Draft Assessment Order was passed by the Assessing Officer on 14.02.2024 is invalid being barred by limitation and liable to be quashed. This Tribunal in the case of Dr. Reddy’s Laboratories Ltd., vs. ACIT (supra) has considered an identical issue in Para nos.7 to 11 as under: “7. We have heard the rival submissions and perused the material available on record including the case laws relied upon. The short issue for our consideration is whether the final assessment order passed by the Ld. AO under section 143(3) read with section 144C(13) of the Act on 27.08.2024 is within the period of limitation. In this regard, we have gone through the provisions of section 144C(13) of the Act, which is to the following effect:

“144C. (1) The Assessing Officer shall, notwithstanding anything to the contrary contained in this Act, in the first instance, forward a draft of the proposed order of assessment (hereafter in this section referred to as the draft order) to the eligible assessee if he proposes to make, on or after the 1st day of October, 2009, any variation which is prejudicial to the interest of such assessee. 2………to 12……………. (13) Upon receipt of the directions issued under sub- section (5), the Assessing Officer shall, in conformity with the directions, complete, notwithstanding anything to the contrary contained in section 153 or section 153B, the assessment without providing any further opportunity of being heard to the assessee, within one month from the end of the month in which such direction is received.”

8.

On perusal of the above, the provisions contained under section 144C(13) of the Act mandates that the Ld. AO shall pass the final assessment order within one month from the end of the month in which the directions of the Ld. DRP under section 144C(5) of the Act are received by the Ld. AO. We have also gone through the screenshots of the ITBA portal placed at page no. 10 of the compilation which is to the following effect:

9.

On perusal of the above, we find that the Ld. DRP’s directions were uploaded on the ITBA portal on 27.06.2024. We have also gone through the screenshots of the email communication from the Ld. DRP to the Ld. AO placed at page no. 13 of the compilation which is to the following effect:

10.

On perusal of the above, we find that the Ld. DRP has sent the directions to the Ld. AO through email on the same date, i.e., 27.06.2024, and the same has been delivered to the Ld. AO on that very date. Therefore, there is no dispute about the fact that the Ld. DRP’s directions were uploaded on the ITBA portal on 27.06.2024, the Ld. DRP has sent the directions to the Ld. AO through email on 27.06.2024 and the email was also delivered to the Ld. AO on the very same date. We have also gone through para nos. 23 to 33 of the judgment of the Hon’ble Telangana High Court in the case of Rapiscan Systems Pvt. Ltd. Vs. ADIT (Int. Tax.) (Supra), which is to the following effect:

11.

On perusal of the above, we find that the Hon’ble High Court has categorically held that the date of upload of Ld. DRP’s directions on the ITBA portal constitutes the date of receipt of such directions by the Ld. AO for the purposes of section 144C(13) of the Act. The Hon’ble High Court also held that the assessment order passed by the Ld. AO after the limitation period is liable to be set aside. In the present case, in addition to the upload on the portal, there is also contemporaneous electronic communication through email, which further strengthens the conclusion that the Ld. DRP’s directions were received by the Ld. AO on 27.06.2024 itself. The contention of the Ld. DR that the date of receipt of the physical copy, i.e., 05.07.2024, should be considered as the relevant date cannot be accepted, in view of the binding decision of the Hon’ble jurisdictional High Court and the undisputed fact that the directions were already made available electronically on 27.06.2024. Accordingly, we hold that the date of receipt of Ld. DRP’s directions by the Ld. AO is 27.06.2024. Therefore, the limitation period for passing the final assessment order expired on 31.07.2024. Since the final assessment order has been passed by the Ld. AO on 27.08.2024, which is beyond the prescribed limitation period, the same is barred by limitation and is liable to be quashed. Accordingly, we quash the final assessment order passed by the Ld. AO under section 143(3) read with section 144C(13) of the Act.”

6.4. Accordingly, in the facts and circumstances as discussed above, we hold that the Draft Assessment Order passed by the Assessing Officer on 14.02.2024 is invalid being barred by limitation and the same is quashed. Since, we have quashed the Draft Assessment Order as invalid which vitiates the subsequent proceedings including giving effect order passed by the Assessing Officer dated 24.12.2024 and therefore, the other grounds raised by the assessee become infructuous which are also not argued.

7.

In the result, appeal of the Assessee is allowed.

Order pronounced in the open court on 22.07.2026.

Sd/- Sd/- MANJUNATHA G VIJAY PAL RAO ACCOUNTANT MEMBER VICE PRESIDENT Hyderabad, Dated 22nd day of July, 2026. VBP Copy to:

CORTEVA AGRISCIENCE SERVICES INDIA PRIVATE LIMITED, 8TH AND 9TH FLOOR, TOWER 2.1 WAVEROCK BUILDING, SURVEY NO. 115(P), NANAKRAMGUDA 1 VILLAGE, SERILINGAMPALLY MANDAL, HYDERABAD- 500081,TELANGANA DCIT., CIRCLE 1(1), O/O DEPUTY COMMISSIONER OF 2 INCOME-TAX, CIRCLE 1(1), HYDERABAD-, TELANGANA 3 THE PR. CIT, HYDERABAD 4 THE D.R., ITAT, HYDERABAD A-BENCH, HYDERABAD 5 GUARD FILE VADREV TRUE COPY Digitally signed by VADREVU U PRASADA RAO Date: PRASAD ASSISTANT REGISTRAR / 2026.07.22 I.T.A.T., HYDERABAD 17:28:49 A RAO +05'30'

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