PRACTO TECHNOLOGIES PRIVATE LIMITED,BANGALORE vs. THE DEPUTY COMMISSIONER OF INCOME TAX , CENTRAL CIRCLE 1(3), BENGALURU, BANGALORE

2. Reassessment proceedings in contravention of the applicable provisions of the Act 2.1. On the facts and in circumstances of the case and in law, the Learned AO erred in not accepting the return of income filed on 7 July 2021 pursuant to notice under section 148 of the Act. 2.2. On the facts and in circumstances of the case and in law, the Learned AO erred in not issuing notice under section 143(2) of the Act pursuant to the return filed in compliance to section 148 of the Act. Accordingly, reassessment proceedings under section 147 of the Act are invalid and bad in law.

3. Assessment Order passed by the Learned AO under section 144 rws 147 rws 144C(13) of the Act is barred by limitation under section 153 of the Act 3.1. On the facts and in the circumstances of the case and in law, the Assessment Order dated 17 January 2024 passed by the Learned AO under section 147 r.w.s. 144 r.w.s. 144C(13) of the Act is barred by limitation under section 153 of the Act and therefore, is void-ab-initio, bad in law and is liable to be quashed.

4. Assessment not in conformity with provisions of section 144 and 144B of the Act 4.1. On the facts and in circumstances of the case and in law, the Learned Assessing Officer has erred in undertaking the best judgement assessment under section 144 of the Act without issuing a show cause notice to the Appellant, to demonstrate why assessment should not be completed to the best of his judgement. 4.2. On the facts and in circumstances of the case and in law, the Assessment Order, being not in conformity with the mandatory procedures laid out in section 144 of the Act for best judgement assessment is bad in law, void ab initio and contrary to the facts and circumstances of the case and is liable to be quashed.

5. No Document Identification Number (‘DIN’) on the directions issued by the Hon’ble DRP 5.1. On the facts and in the circumstances of the case and in law, the Hon’ble DRP erred in not quoting a valid computer-generated DIN on the body of the directions dated 22 December 2023 passed under section 144C(5) of the Act, which is in contravention to the Circular No. 19 of 2019 by the Central Board of Direct Taxes, thus rendering such an order / direction to IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 3 of 21 be invalid and never to have been issued as per para 4 of the said Circular. 5.2. On the facts and in the circumstances of the case and in law, the Assessment Order passed pursuant to invalid and non-est directions of the Hon’ble DRP, is bad in law, null and void and liable to be quashed. The Appellant humbly prays that the Assessment Order be treated as bad in law and ought to be quashed. Grounds relating to TP matters 6. General 6.1. On the facts and in the circumstances of the case and in law, the Hon’ble DRP/Learned AO/Learned TPO erred in making TP adjustment of INR 71,41,014 towards international transaction of provision of software development service, INR 12,93,583 towards international transaction of provision of information technology enables services, INR 86,09,113 towards international transaction of provision of marketing support services and INR 3,42,78,18,865 towards international transaction of transfer of Intellectual Property (‘IP’) to its Associated Enterprise (‘AE’). 6.2. On the facts and in the circumstances of the case and in law, the Hon’ble DRP/Learned AO/Learned TPO erred in not appreciating that there cannot be any adjustment under Chapter X in the absence of accrual of real income.

7. Valuation of IP - Adjustment amounting to INR 3,42,78,18,865 7.1. On the facts and circumstances of the case and in law, the Hon’ble DRP/Learned AO/Learned TPO erred in making an upward transfer pricing adjustment of INR 3,42,78,18,865 on international transaction of transfer of IP to the Appellant’s AE i.e., Practo Pte. Ltd., Singapore. In doing so, Hon’ble DRP/Learned AO/Learned TPO erred in: 7.1.1. commenting that the Appellant has wilfully undervalued the IP asset to reduce the tax liability of the country, without any credible basis; 7.1.2. not appreciating that certain intangibles were not transferred as part of this transfer process viz. Doctor Network, Customer Contracts and Databases were retained by the Appellant; 7.1.3. not appreciating that the value of the enterprise is different from the value of certain intangibles transferred to the AE; IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 4 of 21 7.1.4. not appreciating that the valuation reports (issued by M/s. MRV Krishna & Co and M/s. Guru & Jana) were undertaken for different purposes and were based on different assumptions; 7.1.5. not considering the actual financial results of the Appellant and Practo Pte. Ltd, Singapore, as submitted during the assessment proceedings; 7.1.6. failing to determine if the proposed license fee (i.e., 75% of revenues) meets the arm’s length standard nature and arbitrarily considering the said data for the purposes of valuing the IP; 7.1.7. not appreciating that no license fee on the said IPs has been paid by the Appellant to Practo Pte. Ltd, Singapore for the year under consideration; 7.1.8. failing to adjust the intercompany cost-plus remuneration with respect to software development services, other support and marketing support services that were received by the Appellant, for the firm-wide valuation, which should have been excluded for the purposes of determining the value of IP; 7.1.9. not appreciating that the variation in projections in the two valuation reports is attributable to the change in character of the company from a risk bearing to a cost plus company after the transfer of the IP; 7.1.10. Arbitrarily concluding that the funding received from Practo Pte. Ltd, Singapore against share capital is basically the funding received prima-facie from third party investors which is based on the valuation of the Appellant; 7.1.11. Using an adhoc basis to determine the arm’s length price and not determining the ALP of international transaction as per the provisions of section 92C(2) of the Act; and 7.1.12. not appreciating the business and commercial realities in the process of interfering with the value at which the IP was transferred. (Tax Effect: INR 77,67,43,755) 8. Rejection of TP Documentation On the facts and circumstances of the case and in law, the Hon’ble 8.1.

IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 5 of 21 DRP/Learned AO/Learned TPO erred in invoking the provisions of Section 92C(3) of the Act and not accepting the TP documentation/economic analysis which was undertaken by the Appellant in accordance with the provisions of the Act read with the Income-tax Rules, 1962 (‘the Rules’) and conducting a fresh economic analysis for the determination of the arm’s length price of the impugned international transactions. On the facts and circumstances of the case and in law, the Hon’ble 8.2. DRP/Learned AO/Learned TPO erred in: 8.2.1. Rejecting the high turnover filter of the Appellant while applying filter to reject companies with turnover less than 1 Crore. 8.2.2. Incorrect application of Rule 10B(5) to undertake a fresh search which is non-contemporaneous and against the principles contained under Rule 10D(4) of the Rules; and 8.2.3. Conducting a search which is not in good faith. On the facts and circumstances of the case and in law, the Hon’ble 8.3. DRP/Learned AO/Learned TPO erred in modifying and erroneously interpreting the facts provided by the Appellant in the TP documentation and various submissions.

IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 7 of 21 10.2. On the facts and in the circumstances of the case and in law, the Hon’ble DRP/Learned AO/Learned TPO erred in not adopting the upper turnover filter of INR 200 crores while undertaking the comparability analysis for the Appellant’s international transaction pertaining to provision of information technology enables services. Based on the application of the INR 1 to INR 200 crore turnover filter, the following companies ought to be excluded from the final list of comparable companies: 10.2.1. Tech Mahindra BPSL 10.2.2. Infosys BPO Ltd. 10.2.3. SPI Technologies India Pvt. Ltd. 10.2.4. MPS Ltd. 10.3. On the facts and in circumstances of the case and in law, the Hon’ble DRP / Learned AO/ Learned TPO erred in including certain companies in the comparability analysis which do not satisfy the test of comparability in relation to information technology enables services segmentof the Appellant: 10.3.1. Cross Domain Solutions Private Limited 10.3.2. SPI Technologies India Private Limited 10.3.3. Infosys BPO Limited 10.3.4. E-Care India Private Limited 10.3.5. MPS Limited 10.3.6. Excel Infoways Limited 10.4. On the facts and in circumstances of the case and in law, the Learned AO/ Learned TPO erred in not following the directions of the Hon’ble DRP to rectify the computation of operating mark-up for certain companies while performing the comparability analysis: 10.4.1. Tech Mahindra Business Services Ltd. 10.4.2. BNR Udyog Limited (Tax Effect: INR 4,39,689) 11. Marketing Support Services segment – Adjustment amounting to INR 86,09,113 11.1. On the facts and in circumstances of the case and in law, the Hon’ble DRP/Learned AO/Learned TPO erred in making an upward transfer pricing adjustment of INR 86,09,113 on the international transaction of provision of marketing support services to its AEs.

IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 8 of 21 11.2. On the facts and in the circumstances of the case and in law, the Hon’ble DRP/Learned AO/Learned TPO erred in not adopting the upper turnover filter of INR 200 crores while undertaking the comparability analysis for the Appellant’s international transaction pertaining to provision of marketing support services. Based on the application of the INR 1 to INR 200 crore turnover filter, the following companies ought to be excluded from the final list of comparable companies: 11.2.1. Just Dial Ltd 11.2.2. Rites Ltd. 11.3. On the facts and in circumstances of the case and in law, the Hon’ble DRP/Learned AO/Learned TPO erred in including certain companies in the comparability analysis which do not satisfy the test of comparability in relation to marketing support services segmentof the Appellant: 11.3.1. Axience Consulting Pvt. Ltd. 11.3.2. Axis Integrated Systems Ltd. 11.3.3. Digital Radio (Delhi) Broadcasting Ltd. 11.3.4. Just Dial Ltd. 11.3.5. Rites Ltd. 11.3.6. Platinum Advertising Pvt. Ltd. 11.4. On the facts and in circumstances of the case and in law, the Learned AO/ Learned TPO erred in not following the directions of the Hon’ble DRP to rectify the computation of operating mark-up for certain companies while performing the comparability analysis: 11.4.1. Axience Consulting Pvt. Ltd. 11.4.2. Just Dial Ltd. 11.4.3. Rites Ltd. 11.4.4. Irclass India Pvt. Ltd. 11.4.5. Ugam Solutions Pvt. Ltd. 11.5. On the facts and in circumstances of the case and in law, the Learned AO/ Learned TPO erred in not following the directions of the Hon’ble DRP and not including certain companies in the comparability analysis which satisfy the test of comparability in relation to the marketing support services segment of the Appellant: 11.5.1. Showhouse Event Management Pvt Ltd 11.5.2. Fusion Events Pvt. Ltd 11.6. On the facts and in circumstances of the case and in law, the Hon’ble DRP / Learned AO/ Learned TPO erred in not including certain IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 9 of 21 companies in the comparability analysis which satisfy the test of comparability in relation to the marketing support services segment of the Appellant: 11.6.1. MCI Management India Pvt. Ltd. 11.6.2. Competent Automobiles Co. Ltd. (Service & Spares) (Tax Effect: INR 29,26,238) Grounds relating to Corporate Tax matters 12. Method of computation of capital gains on transfer of IP to AE Practo Pte Ltd., Singapore (Without prejudice to Ground of Appeal

No. 8) 12.1. On the facts and circumstances of the case and in law, the Hon’ble DRP/Learned AO erred in bringing to tax the gains on transfer of IP without appreciating the fact that the computation mechanism of capital gains as provided under Chapter IV fails and therefore the transfer price of IP received by Appellant from its AE i.e., Practo Pte. Ltd., Singapore ought to be treated as capital receipt and not chargeable to income tax. 12.2. Without prejudice to the above, on the facts and circumstances of the case and in law, the Hon’ble DRP/Learned AO while computing long term capital gain of INR 3,42,78,18,865, erred in treating the cost of acquisition of all the IPs (including technological IPs) as NIL as per the provisions of section 55(2) of the Act without appreciating that the said provisions do not apply to the technological IPs transferred during the year.

13. Disallowance under section 14A of the Act read with rule 8D of the Rules amountingto INR 24,00,068 13.1. On the facts and circumstances of the case and in law, the Hon’ble DRP / Learned AO erred in making disallowance of expenses under section 14A of the Act read with Rule 8D of the Rules. 13.2. On the facts and circumstances of the case and in law, the Hon’ble DRP / Learned AO erred in considering the investment value under Rule 8D of the Rules to even those investments, which did not yield any exempt income during the year. 13.3. On the facts and circumstances of the case and in law, the Hon’ble DRP / Learned AO has failed to appreciate that investments yielding exempt income were made out of own funds of the Appellant and no interest cost is attributable to the exempt income under Rule 8D(2)(ii) of the Rules.

IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 10 of 21 13.4. On the facts and circumstances of the case and in law, the Hon’ble DRP / Learned AO erred in not restricting the disallowance under section 14A of the Act to INR 5,53,950 being exempt income earned by the Appellant during the year. 13.5. Notwithstanding anything contained in grounds above, on the facts and circumstances of the case and in law, the Learned AO erred in not following the directions of the Hon’ble DRP while passing the Assessment Order and made a disallowance of INR 24,00,068 without considering the suo-moto disallowance of INR 22,68,047 made the Appellant in the original return of income, thereby resulting in double disallowance. (Tax effect: INR 8,15,783) 14. Disallowance of AMP expenses amounting to INR 3,48,14,372 14.1. On the facts and circumstances of the case and in law, the Hon’ble DRP / Learned AO erred in disallowing AMP expenses to the tune of INR 3,48,14,372 by alleging the same to be capital in nature and are not wholly or exclusively incurred for the purpose of business. 14.2. On the facts and circumstances of the case and in law, the Learned AO has erred in: 14.2.1. Not following the directions of the Hon’ble DRP while passing the Assessment Order and not considering the factual report submitted by the Learned AO to the Hon’ble DRP whereby INR 4,04,15,218 out of the total AMP expense (of INR 4,35,17,965) should be treated as revenue expense and on the balance amount, depreciation under section 32 of the Act ought to be allowed.; and 14.2.2. Treating balance AMP expenditure of INR 31,02,747 as capital in nature even though it was incurred for the purpose of day-to-day business operations of the Appellant and is within the 20% threshold adopted by Learned AO making the said adjustment. The Learned AO has erred in not appreciating that balance AMP expenditure of INR 31,02,747 is therefore allowable expenditure under section 37 of the Act. (Tax effect: INR 1,18,33,405) 15. Levy of interest under section 234A of the Act amounting to INR 52,58,48,793 IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 11 of 21 15.1. On the facts and in circumstances of the case and in law, the Learned AO erred in levying interest under section 234A of the Act amounting to INR 52,58,48,793 ignoring the fact that the delay was not attributable to the Appellant but was on account of technical glitch on the income-tax e- filing portal to which the Appellant had no control. 15.2. On facts and in circumstances of the case and in law, the Appellant denies its liability to pay interest under section 234A of the Act. 15.3. Without prejudice to the above, on the facts and in circumstances of the case and in law, the Learned AO erred in wrongly calculating and levying excess interest under section 234A of the Act. (Tax Effect: INR 52,58,48,793) 16. Excess Levy of interest under section 234B of the Act amounting to INR 80,78,25,682 16.1. On the facts and in circumstances of the case and in law, the learned AO has erred in levying interest of Rs. 80,78,25,682 under section 234B of the Act and the Appellant denies its liability to pay such interest. 16.2. Without prejudice to the above, on the facts and in circumstances of the case and in law, the Learned AO erred in wrongly calculating and levying excess interest under section 234B of the Act amounting to INR 80,78,25,682 instead of INR 72,06,55,910. (Tax Effect: INR 8,71,69,772) 17. Levy of interest under section 234D of the Act amounting to INR 74,420 17.1. On the facts and in circumstances of the case and in law, the learned AO has erred in levying interest of Rs. 74,420 under section 234D of the Act and the Appellant denies its liability to pay such interest. (Tax Effect: INR 74,420) 18. Penalty Proceedings 18.1. On the facts and in circumstances of the case and in law, the Learned AO erred in initiating penalty proceedings under section 274 r.w.s. 271(1)(c) of the Act. That the Appellant craves leave to add to and / or to alter, amend, rescind, modify the grounds herein below or produce further documents before or at the time of hearing of this Appeal.

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IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 14 of 21 A set of11comparable companies was Marketing determined and the median arm’s length 3 Support Services 10,372,814 mark-up was computed at 22.88%,as (‘MSS’) against the10% earned by the Assessee. Valuation of The value of intangible was determined to 4 intangible asset be75% of the value of the firm as 3,466,757,250 transferred to AE computed by MRV Krishna & Co. TOTAL 3,487,865,338 3.8 The AO passed a draft assessment order under section 144C(1) of the Act on 30.03.2023, determining the total income of the Assessee at Rs. 340,68,58,962 after incorporating the TP adjustments as above and making certain disallowances under section 14A and section 37 of the Act. It may be noted that the draft assessment order was passed post the date of condonation of delay in e-verification of the return. 3.9 The Assessee filed its objections with the Dispute Resolution Panel ('DRP') in Form 35A, as per section 144C(2) of the Act on 28.04.2023. The DRP issued its directions on 22.12.2023. Some issues were partially decided in favor of the Assessee. 3.10 Post receipt of the Hon'ble DRP's directions, the re- assessment proceedings were completed as a best judgement assessment under section 144 of the Act, for non-filing of return of income. The assessing officer issued the final assessment order u/s 147 r.w.s.144 read with section 144C(13) of the Act on 17.01.2024 by making the following adjustments: Sl. Nature of proposed Adjustment Amount in Rs. No. Total income as per return of income (11,82,20,816) 1. Arm’s Length Price for Software Development services to 71,41,014 AE 2. Arm’s Length Price for Information Technology enables 12,93,583 Services segment to AE 3. Arm’s Length Price for Marketing Support Services 86,09,113 4. Valuation of Intellectual Property (‘IP’) transferred to AE 342,78,18,865 Total adjustment u/s 92CA 344,48,62,575 IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 15 of 21 5. Disallowance of advertising, marketing & promotion 3,48,14,372 expenses us 37 6. Disallowance us 14A 24,00,068 Assessed Income 3,363,856,199

IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 16 of 21

7.1 In the Present case, the Assessee was unable to e - verify the return of income within the specified period of 120 days, due to the technical errors on the e-filing portal. The correspondence with the technical glitches on the new e-filing portal during the period, were also acknowledged by the Central Board of Direct Taxes on several instances. Certain press releases issued during the relevant period i.e., FY 2021, acknowledging such technical glitches are also placed on page 1849 to 1850 of case law compendium.

7.2 Further, the ld. DR during the course of hearing also submitted a list of the attempts made by the Assessee to register the DSC of the authorized signatory on the e-filing portal, which is a pre-requisite for e-verification of the return of income. The repeated attempts are indicative of the issue continuing to remain unresolved.

7.3 We also take a note of the fact that the Assessee had, as an alternative and in the spirit of compliance, also filed a physical copy of the return of income and ITR-V with the Assessing officer along with its letter dated 22.07.2021. The Assessee has discharged its duty of filing the return of income electronically and filing a copy of the same with the AO to be considered as valid return of income. The learned AO has also completed the assessment by relying on the return of income filed by the Assessee on 07.07.2021. This is evident from Para 7.1 and 7.2 of the final assessment order.

IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 18 of 21 The Hon’ble High court of Delhi in the case of PCIT v. S.G. Portfolio (P.) Ltd [2023] 151 taxmann.com 307 (Delhi), has held that when a return was in place in the form of original return filed, the AO was required to issue a notice under section 143(2) and recourse to section 144 of the Act was incorrect.

7.4 Further during the relevant period, vide the Circular No. 21/2021 [F. No. 225/140/2021/ITA-II], dated 28.12.2021 and Circular No. 13/2020 [F. No. 225/59/2020/ITA -II], dated 13.7.2020, the CBDT had provided a relaxation for verification of income-tax returns e-filed for assessment year 2020-21 and AY 2015-16 to AY 2019-20 respectively, which were pending for verification (placed at Page 1851 & 1852 of case law compendium). Circular No. 21/2021 required the assessee to complete the verification process by 28.02.2022. The Assessee completed the process of e-verification on 21.12.2021, which is well within the extended time allowed by the circular covering the relevant period. Though these circulars do not explicitly cover returns filed under section 148 of the Act for such years, circular No. 21/2021 is evidence of an implicit acknowledgement of the technical glitches on the e-filing portal. The circulars also are an implicit acknowledgement of verification of returns being a procedural requirement. The benefit of the spirit of the above circulars should therefore be extended to the Assessee’s case as well. In the present case, the Assessee cured the defect of ‘return of income not being verified’, by e-verifying the return on 21.12.2021. This was done soon after the glitches had been removed by the Department. Thus, the return under section 148 should be considered as filed on 07.07.2021 and treated as valid.

7.5 Further we also take a note of the fact that the delay in e- verification of return of income has also been condoned by the IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 19 of 21 CPC on 20.02.2023, by treating the return of income filed on 07.07.2021 as a valid return of income.

7.6 In the case of PCIT v. Oberoi Hotels (P.) Ltd. [2018] 96 taxmann.com 104 (Calcutta) (placed at Page 1829 of case law compendium), the Hon’ble Calcutta High Court held that the notice under section 143(2) of the Act was required to be mandatorily issued. The Assessee has also relies upon on the following judicial precedents for its contention that the re-assessment order under section 147 r.w.s 144 issued without issuing a notice under section 143(2) is bad in law: i. PCIT v. Paramount Biotech Industries Ltd. [2018] 99 taxmann.com 456 (Delhi) ( placed at Page 1827 of case law compendium) ii. PCIT v. Cosmat Traders (P.) Ltd. [2023] 146 taxmann.com 207 (Calcutta) (placed at Page 1881 of case law compendium) We relying on the above are also of the opinion that the re- assessment proceedings concluded without a valid notice under section 143(2) is bad in law and liable to be quashed in entirety as the return of income filed on 07.07.2021 is a valid return of income for the purpose of income tax Act. Even otherwise and without prejudice, no assessment could have been undertaken even under section 144 of the Act without issue of a valid notice under section 143(2) of the Act, and without issue of a notice proposing to complete the assessment under section 144 on the alleged failure to furnish the return.

7.7 Further, we are also of the firm opinion that as rightly contended by the AR of the assessee, the AO had also not served any show cause notice of intention to complete the assessment under section 144 of the Act to the Assessee as required by first proviso to section 144(1) of the Act. The preconditions of the section, to enable a best judgement assessment had not been met, IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 20 of 21 making even the assessment order under section 144 of the Act being illegal & bad in law.

7.8 Further as observed by the Hon’ble Supreme Court in the case of ACIT & Anr. Vs. Hotel Blue Moon (2010) 321 ITR 362 (SC), the omission on the part of the AO to issue notice under sec.143(2) can not be held to be a procedural irregularity, and the same is not curable. The failure of AO in reassessment proceeding to issue a valid notice under section 143(2) of the Act prior to finalizing the reassessment order can not be condoned. It was held by the Hon’ble Supreme Court that for the purpose of framing of a valid assessment, issuance of a notice under section 143(2) of the Act can not be dispensed with.

7.9 We are of the opinion that the reliance placed by ld. DR on the decision of the coordinate bench in the case of Rakesh Aggarwal vs ITO in MA No. 249/Del/2020 dated 15/12/2020 is completely different and distinguishable from the facts of the present case. In the present case the assessee filed original return u/s 139(1) of the Act and also filed the return in response to notice u/s 148 of the Act but could not e-verified the return filed u/s 148 within time due to technical glitches. The assessee had also submitted the hard copy of the Return before the AO. Further the CPC had also condoned the delay in e-verifying the Return. Thus from the aforesaid discussions, we come to the conclusion that the return of income has been filed in response to notice u/s 148 of the act & the delay in e-verifying the return due to the technical glitches has also been condoned by the CPC & therefore return filed on 07/07/2021 is a valid return. Section 144 of the Act concededly deals with the situation where inter alia, the assessee fails to file a return or fails to comply with all the terms of the notice issued under section 142 of the Act or fails to comply with the direction issued under sub IT(TP)A No.311/Bang/2024 M/s. Practo Technologies Private Limited, Bangalore Page 21 of 21 section (2A) of section 142 or fails to comply with the terms of the notice issued under section 143(2) of the Act. Therefore, for the AO to take recourse to section 144 of the Act was completely uncalled for. We are of the considered opinion that where the return of income has been filed in response to notice u/s 148 of the Act and no notices has been validly issued by the AO u/s 143(2) of the Act, the subsequent assessment proceedings u/s 147 stand vitiated and the order so passed by the AO u/s 144 r/w 147 deserve to be set- aside and is hereby set-aside. 7.10 In light of aforesaid, where we have set-aside the reassessment proceedings for want of issuance of valid notice u/s 143(2) of the Act & held that recourse to section 144 of the Act by the AO is completely unjustified, the other grounds of appeals have become academic in nature and the same are thus left open.