DR. REDDYS LABORATORIES LIMITED,HYDERABAD vs. ACIT., CIRCLE- 8(1), HYDERABAD

आयकर अपील�य अ�धकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘ DB-A ‘ Bench, Hyderabad �ी �वजय पाल राव, उपा� य� एवं �ी मधुसूदन साव�डया, लेखा सद� य के सम� । Before Shri Vijay Pal Rao, Vice-President A N D Shri Madhusudan Sawdia, Accountant Member आ.अपी.सं /ITA No.983/Hyd/2024 (िनधा�रण वष�/Assessment Year:2020-21 ) Dr. Reddy’s Laboratories Vs. Assistant Limited Commissioner of Hyderabad Income Tax PAN:AAACD7999Q Circle 8(1) Hyderabad (Appellant) (Respondent) िनधा�रती �ारा/Assessee by: CA Sriram Seshadri राज� व �ारा/Revenue by: Smt. K. Haritha, CIT(DR) सुनवाई की तारीख/Date of hearing: 21/04/2026 घोषणा की तारीख/Pronouncement: 06/05/2026 आदेश/ORDER Per Madhusudan Sawdia, A.M.:

This appeal is filed by Dr. Reddy’s Laboratories Ltd (“the assessee”), feeling aggrieved by the final assessment order of the Learned Assessing Officer (“Ld. A.O”) passed u/s 143(3) r.w.s. 144C (13) of the Income Tax Act, 1961 (“the Act”) dated 27.08.2024 in accordance with the directions of the Learned Dispute Resolution Panel-1, Bangalore (“Ld. DRP”) under section 144C(5) of the Act dated 27.06.2024 for the A.Y.2020- 21. 2. The assessee has raised the following grounds of appeal:

10 for complete scrutiny under CASS and accordingly, notice under section 143(2) of the Act dated 29.06.2021 was issued by the Ld. AO. Since the assessee had entered into international transactions with its Associated Enterprises, the case of the assessee was referred to the Learned Transfer Pricing Officer (“Ld. TPO”) for determination of Arm’s Length Price. The Ld. TPO passed an order under section 92CA(3) of the Act dated 31.07.2023 suggesting a transfer pricing adjustment of Rs.209,09,89,146/-. After considering the TPO’s order and submissions of the assessee on other issues, the Ld. AO passed a draft assessment order under section 144C(1) of the Act on 30.09.2023 computing the total income of the assessee at Rs.2174,25,01,782/-, including the TP adjustment. 4. Aggrieved with the draft assessment order of the Ld. AO the assessee filed objections before the Ld. DRP. The Ld. DRP issued directions under section 144C(5) of the Act on 27.06.2024. Pursuant to these directions, the Ld. AO passed the final assessment order under section 143(3) read with section 144C(13) of the Act on 27.08.2024 determining the total income of the assessee at Rs.2194,76,22,334/-, including TP adjustment of Rs.208,91,09,288/-. 5. Aggrieved by the final assessment order of the Ld. AO, the assessee is in appeal before the Tribunal. At the outset, the Ld. AR submitted that Ground No.2 of the appeal is a legal ground challenging the validity of the final assessment order passed by the Ld. AO on the ground that the same is barred by limitation as prescribed under section 144C(13) of the Act. It was submitted that if this legal ground is decided in favour of the assessee, the other grounds raised in the appeal would become academic in nature. The Ld. AR invited our attention

11 to the provisions of section 144C(13) of the Act and submitted that the Ld. AO is required to 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) are received by the Ld. AO. It was submitted that in the present case, the Ld. DRP issued directions on 27.06.2024. Therefore, the limitation period for passing the final assessment order by the Ld. AO expired on 31.07.2024. However, the Ld. AO passed the final assessment order on 27.08.2024, which is beyond the prescribed limitation period. The Ld. AR further invited our attention to the screenshots of the ITBA Portal placed at page no. 10 of the compilation and demonstrated that the directions of the Ld. DRP were uploaded on the ITBA portal on 27.06.2024. He also drew our attention to the email communication sent by the Ld. DRP to the Ld. AO on the same date, i.e., 27.06.2024, which was duly delivered on the same day, placed at page no. 13 of the compilation. It was thus submitted that the Ld. DRP’s directions were not only uploaded on the portal but were also electronically communicated to the Ld. AO on 27.06.2024 itself, thereby clearly establishing the date of receipt by the Ld. AO as 27.06.2024. The Ld. AR placed reliance on the decision of the Hon’ble Telangana High Court in the case of Rapiscan Systems Pvt. Ltd. Vs. ADIT (Int. Tax.) W.P. Nos. 44891 and 44915 of 2022, dated 09.01.2025, wherein it has been held that the date of upload of Ld. DRP’s directions on the ITBA portal constitutes the date of receipt for the purposes of section 144C(13) of the Act. It was also held that the assessment order passed by the Ld. AO after the limitation period is liable to be set aside. Accordingly, it was contended that the final assessment order passed by the Ld.

12 AO on 27.08.2024 is beyond the limitation period and is liable to be quashed.

13 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:

14 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:

17 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. 12. Since we have allowed the legal ground of the assessee, the other grounds raised in the appeal are rendered academic and do not require adjudication.

18 13. In the result, the appeal of the assessee is allowed. Order pronounced in the Open Court on 6th May, 2026. Sd/- Sd/- (VIJAY PAL RAO) (MADHUSUDAN SAWDIA) VICE PRESIDENT ACCOUNTANT MEMBER Hyderabad, dated 6th May, 2026. Vinodan/sps Copy to: S.No Addresses 1 Dr. Reddy’s Laboratories Ltd, 8-2-337 Road No.3, Banjara Hills, Hyderabad 500034 2 Assistant Commissioner of Income Tax Circle 8(1) Signature Towers, Kondapur, Opp: Botanical Gardens, Hyderabad 500084 3 Pr. CIT - Hyderabad 4 DR, ITAT Hyderabad Benches 5 Guard File By Order

Digitally signed by TIRUPATI TIRUPATI YAMINI YAMINI NAGA NAGA MALLESWARI Date: 2026.05.07 MALLESWARI 14:28:55 +05'30'