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“draft assessment order”

Assessment ProceduresSection 144CSection 144C4,773 judgments

The decision most relied on for draft assessment order is ACIT v. Serajuddin & Co. (454 ITR 312), cited in 580 judgments on BharatTax.

Leading authorities on draft assessment order

ACIT v. Serajuddin & Co.
454 ITR 312 · 2023 · High Court
580
citing judgments

Approval under Section 153D of the Income Tax Act is mandatory for assessment orders in search cases. While elaborate reasons for approval are not required, the approving authority must provide some indication that it has examined the draft orders and found them to meet the requirements of law.

Principal Commissioner of Income-tax v. Subodh Agarwal
149 Taxmann.com 373 · 2023 · High Court
194
citing judgments

Approval of draft assessment orders under Section 153D must be granted with due application of mind, not mechanically. Approving multiple cases, such as 38 in a single day, without proper scrutiny amounts to mechanical approval, rendering the assessment invalid.

Vijay Television (P.) Ltd. v. DRP
369 ITR 113 · 2014 · High Court
140
citing judgments

Passing a final assessment order under Section 143(3) directly, without first issuing a draft assessment order under Section 144C(1) for an eligible assessee, constitutes a fundamental jurisdictional defect. This defect cannot be cured by a subsequent corrigendum, especially if issued beyond the prescribed period of limitation.

ESPN Star Sports Mauritius S.N.C. ET Compagnie v. Union of India
388 ITR 383 · 2016 · High Court
71
citing judgments

Failure to issue a draft assessment order under Section 144C(1) makes the final assessment order illegal and beyond jurisdiction. Non-compliance with Dispute Resolution Panel (DRP) directions renders the final assessment order bad in law.

JCB India Ltd. v. DCIT
398 ITR 189 · 2017 · High Court
49
citing judgments

The requirement to pass a draft assessment order under Section 144C of the Act is mandatory. A final assessment order issued without such a draft order is a nullity, constituting an incurable jurisdictional error that cannot be saved by Section 292B, even in set-aside proceedings following an ITAT remand.

Aggarwal v. NFAC
127 Taxmann.com 637 · High Court
34
citing judgments

Denying a personal hearing when specifically requested, especially after a search and during a pandemic, violates the principles of natural justice. The assessment and appellate proceedings themselves were conducted during the COVID-19 pandemic.

Hire Purchase (P.) Ltd. v. NFAC
128 Taxmann.com 190 · High Court
34
citing judgments

Failure to grant a personal hearing to an assessee when income is likely to be varied based on submitted evidence violates the principles of natural justice and renders the assessment order invalid.

Chandrakant Dharia v. ITO
469 ITR 262 · Reported
34
citing judgments

An adverse assessment order cannot be passed without granting an opportunity of personal hearing to the taxpayer. Where income is to be varied based on evidence, a personal hearing is mandatory.

Judgments citing draft assessment order

Svp South West Industries Ltd. (Formerly, Platinum Textile Ltd.), Mumbai vs. DCIT, CC- 8(2), Mumbai

ITA 1271/MUM/2022[2013-14]Status: DisposedITAT Mumbai30 Apr 2024AY 2013-14

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

Assessment Order have been done manually and not through system. This would mean that the tax calculation was available along with the Draft Assessment Order as there was no time available for manual tax calculation after the approval was granted. If the tax calculation was available along with the Draft ... proceeding sheet in the case of Platinum Textiles Limited for AY 2016-17, nowhere has it been recorded that the Draft Assessment Order was forwarded to Addl. CIT and Addl. CIT has granted its approval for the same. f. The forwarding letter of the Draft Assessment Order does not mention

Citron Infraproject Ltd., Mumbai-400005 vs. Dy Commissioner of Income Tax, Central Circle-7(2), Mumbai

ITA 1270/MUM/2022[2012-13]Status: DisposedITAT Mumbai30 Apr 2024AY 2012-13

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

Order: Sr. No. Name of entity A.Υ. Date Approval of Date of Assessment Order No. of pages No. of pages in the Draft Assessment order 1. Approval granted on 25.02.2021 Citron 2012-13 25.02.2021 26.02.2021 58 58 2. Infraprojects ... Assessment Order have been done manually and not through system. This would mean that the tax calculation was available along with the Draft Assessment Order as there was no time available for manual tax calculation after the approval was granted. If the tax calculation was available along with the Draft

Svp South West Industries Ltd. (Formerly, Platinum Textile Ltd.), Mumbai-400005 vs. Commissioner of Income Tax, Central Circle-8(2), Mumbai

ITA 1269/MUM/2022[2014-15]Status: DisposedITAT Mumbai30 Apr 2024AY 2014-15

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

details of approval as under: Details of approval and Assessment Order: Sr. Name of entity A.Υ. No. No. of pages in the Draft Assessment order Date Approval of Date of Assessment Order No. of pages Assessment order 1. Approval granted on 25.02.2021 1. Citron ... Assessment Order have been done manually and not through system. This would mean that the tax calculation was available along with the Draft Assessment Order as there was no time available for manual tax calculation after the approval was granted. If the tax calculation was available along with the Draft

Citron Infraproject Ltd., Mumbai-400005 vs. Dy Commissioner of Income Tax, Central Circle-7(2), Mumbai-400020

ITA 1268/MUM/2022[2018-19]Status: DisposedITAT Mumbai30 Apr 2024AY 2018-19

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

Assessment Order have been done manually and not through system. This would mean that the tax calculation was available along with the Draft Assessment Order as there was no time available for manual tax calculation after the approval was granted. If the tax calculation was available along with the Draft ... proceeding sheet in the case of Platinum Textiles Limited for AY 2016-17, nowhere has it been recorded that the Draft Assessment Order was forwarded to Addl. CIT and Addl. CIT has granted its approval for the same. f. The forwarding letter of the Draft Assessment Order does not mention

Citron Infraproject Ltd., Mumbai-400005 vs. Dy Commissioner of Income Tax, Central Circle-7(2), Mumbai-20

ITA 1267/MUM/2022[2015-16]Status: DisposedITAT Mumbai30 Apr 2024AY 2015-16

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

Assessment Order have been done manually and not through system. This would mean that the tax calculation was available along with the Draft Assessment Order as there was no time available for manual tax calculation after the approval was granted. If the tax calculation was available along with the Draft ... proceeding sheet in the case of Platinum Textiles Limited for AY 2016-17, nowhere has it been recorded that the Draft Assessment Order was forwarded to Addl. CIT and Addl. CIT has granted its approval for the same. f. The forwarding letter of the Draft Assessment Order does not mention

Skybridge Solutions Private Limited, Hyderabad vs. DCIT, (Tp)-2 Hyderbad, Hyderabad

In the result, the appeal of the assessee is dismissed

ITA 184/HYD/2024[2021-22]Status: DisposedITAT Hyderabad29 Apr 2024AY 2021-22

Bench: Shri Laliet Kumar(Through Virtual Mode) & Shri Madhusudan Sawdia, Accounant Member Assessment Year: 2021-22 Skybridge Solutions Vs. The Deputy Commissioner Of Private Limited, Income Tax, Hyderabad, (Transfer Pricing)-2, H.No.8-2-239/L/83-A, Hyderabad. Plot No.83/A, Mla Colony, Road No.12, Banjara Hills, Hyderabad – 500034, Telangana. Pan : Aalcs1899M. (Appellant) (Respondent) Assessee By: Shri Mahesh Raichandani, C.A. Revenue By: Ms. K. Haritha, Cit-Dr Date Of Hearing: 23.04.2024 Date Of Pronouncement: 29.04.2024 O R D E R Per Laliet Kumar, J.M. The Appeal Of The Assessee For A.Y. 2021-22 Arises From The Impugned Assessment Order Passed U/S 143(3) R.W.S. 144C(3) R.W.S. 144B Of The Income Tax Act Dated 26.12.2023. 2. The Brief Facts Of The Case Are That The Assessee Is A Software Development & Services Company, Filed Its Income Tax Return For The Assessment Year 2021-22 On 09.03.2022, Declaring A Total Income Of Rs.1,06,49,030. The Return Was Processed Under Section 143(1)(A) Of The Income Tax Act On 24.08.2022. Subsequently, The Case Was Selected For Scrutiny Under Cass & A Notice Under Section 143(2) Was Issued On 28.06.2022, To Which The Assessee Responded On 15.07.2023. Thereafter, A Reference Under Section 92Ca(1) Was Made To The Transfer Pricing Officer (Tpo) To Determine The Arm'S Length Price For Transactions With Associated Enterprises. The Tpo, Through An Order Dated 31.10.2023, Directed An Upward Adjustment Of Rs.1,83,25,993 To The Assessee'S Income For The Financial Year 2020-21. Consequently, A Show Cause Notice Was Issued To The Assessee On November 9, 2023, Regarding The Proposed Adjustment, Along With A Penalty Initiation Under Section 270A.

For Appellant: Shri Mahesh Raichandani, C.AFor Respondent: Ms. K. Haritha, CIT-DR
Section 142(1)Section 143Section 143(1)(a)Section 143(2)Section 143(3)Section 144CSection 147Section 154Section 253(1)(d)Section 270A

response was received. Another show cause notice was issued on 09.11.2023, regarding the 2 disallowance, but again, no response was forthcoming. Consequently, the draft assessment order was passed on 22.11.2023 proposing the total income at Rs. 2,98,36,480/-. The assessee was given 30 days to either accept ... that the present appeal is not maintainable as per section 253(1)(d) of the Act. In the present case, AO has passed draft assessment order on 22/11/2023. Against that draft assessment order, assessee has not filed any objections before the AO as well as before the DRP u/s. 144C

DCIT, Central Circle-14, New Delhi vs. Mdlr Airlines P.Ltd, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1719/DEL/2023[2008-09]Status: DisposedITAT Delhi29 Apr 2024AY 2008-09

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment order relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

DCIT, Central Circle-14, New Delhi vs. Mdlr Airlines P. Ltd, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1718/DEL/2023[2007-08]Status: DisposedITAT Delhi29 Apr 2024AY 2007-08

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment order relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

DCIT, Central Circle 14, New Delhi vs. Nageshwar Builders P.Ltd, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1704/DEL/2023[2006-07]Status: DisposedITAT Delhi29 Apr 2024AY 2006-07

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2005-06 A.Y. 2006-07 A.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment orders relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

DCIT, Central Circle-14, New Delhi vs. Nageshwar Builders P.Ltd, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1703/DEL/2023[2005-06]Status: DisposedITAT Delhi29 Apr 2024AY 2005-06

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2005-06 A.Y. 2006-07 A.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment orders relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

Nageshwar Builders (P) Ltd., New Delhi vs. DCIT Central Circle-14, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1664/DEL/2023[2008-09]Status: DisposedITAT Delhi29 Apr 2024AY 2008-09

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2005-06 A.Y. 2006-07 A.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment orders relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

Nageshwar Builders (P) Ltd., New Delhi vs. DCIT Central Circle-14, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1663/DEL/2023[2007-08]Status: DisposedITAT Delhi29 Apr 2024AY 2007-08

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2005-06 A.Y. 2006-07 A.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment orders relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

Nageshwar Builders (P) Ltd., New Delhi vs. DCIT Central Circle-14, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1662/DEL/2023[2006-07]Status: DisposedITAT Delhi29 Apr 2024AY 2006-07

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2005-06 A.Y. 2006-07 A.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment orders relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

Nageshwar Builders (P) Ltd., New Delhi vs. DCIT Central Circle-14, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1661/DEL/2023[2005-06]Status: DisposedITAT Delhi29 Apr 2024AY 2005-06

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2005-06 A.Y. 2006-07 A.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment orders relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

Mdlr Airlines (P) Ltd., New Delhi vs. DCIT Central Circle-14, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1421/DEL/2023[2008-09]Status: DisposedITAT Delhi29 Apr 2024AY 2008-09

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment order relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

Mdlr Airlines (P) Ltd., New Delhi vs. DCIT Central Circle-14, New Delhi

In the result, assessee’s appeals are allowed as indicated above

ITA 1420/DEL/2023[2007-08]Status: DisposedITAT Delhi29 Apr 2024AY 2007-08

Bench: Shri Saktijit Dey & Shri Naveen Chandraa.Y. 2007-08 A.Y. 2008-09

Section 132Section 142Section 143(3)Section 144Section 153ASection 153DSection 264

Delhi to the Deputy Commissioner of Income- tax, Central Circle-15, New Delhi, granting approval u/s 153D of the Act in respect of draft assessment order relating to six different assessees involving different assessment years and submitted that the approval granted u/s 153D of the Act revealed mechanical approach ... approval granted clearly reveals that the Approving Authority has not examined either the seized materials or the assessment records before approving the draft assessment orders in terms of Section 153D of the Act. Thus, he submitted, due to lack of proper approval u/s 153D of the Act, the assessment orders

M/S. Atul Ltd., Ahmedabad vs. The Dy.CIT, Circle-1(1)(2), Ahmedabad

The appeal of the assessee is partly allowed in the above terms for statistical purpose

ITA 446/AHD/2015[2010-11]Status: DisposedITAT Ahmedabad26 Apr 2024AY 2010-11

Bench: Smt.Annapurna Gupta & Shri T.R. Senthil Kumarit(Tp)A No.446/Ahd/2015 Assessment Year : 2010-11 M/S.Atul Limited Dcit, Cir.1(1)(2) Atul House Vs Ahmedabad. Gi Patel Marg Ahmedabad 380 014. Pan : Aabca 2390 M

For Appellant: Shri S.N. Soparkar, Sr.Advocate &For Respondent: Dr.Darsi Suman Ratnam, CIT-DR
Section 143(3)Section 144Section 92C

directions of the Dispute Resolution Panel on the objections raised by the assessee to the additions proposed by the AO in his draft assessment order in terms of section 144(C)(13) of the Act. Aggrieved by the same the assessee has come up in appeal before

DCIT, New Delhi vs. M/S. American Express India Pvt. Ltd., New Delhi

ITA 2577/DEL/2014[2009-10]Status: DisposedITAT Delhi26 Apr 2024AY 2009-10

Bench: Shri Shamim Yahya & Shri Sudhir Kumaramerican Express (India) Private Ltd., Vs. Acit, Circle 1 (1), Metropolitan Saket, New Delhi. 7Th Floor, Office Block, District Centre, Saket, New Delhi. (Pan : Aaaca8163F) (Appellant) (Respondent) Acit, Circle 1(1) Vs American Express (India) Private Room No.392, C.R. Building, Ltd., I.P. Estate, New Delhi-110002 Metropolitan Saket, 7Th Floor, Office Block, District Centre, Saket, New Delhi.

For Appellant: Shri Nageswar Rao, AdvocateFor Respondent: Shri Rajesh Kumar, CIT DR
Section 271(1)(c)Section 92C

only an error that amount involved has not been mentioned in the chart. Further, it is seen that in the draft assessment order also, the adjustment in this regard is said to be addition of Rs.71,41,54,973/- made to the income of the assessee between difference ... fixed assets. In this scenario, it is the submission of the ld. Counsel for the assessee that no adjustment was made in the draft assessment order and assessee did not file any objection before the ld. DRP. He further submits that while giving effect to DRP directions

M/S. American Express (India) Private Limited, New Delhi vs. ACIT, New Delhi

ITA 1973/DEL/2014[2009-10]Status: DisposedITAT Delhi26 Apr 2024AY 2009-10

Bench: Shri Shamim Yahya & Shri Sudhir Kumaramerican Express (India) Private Ltd., Vs. Acit, Circle 1 (1), Metropolitan Saket, New Delhi. 7Th Floor, Office Block, District Centre, Saket, New Delhi. (Pan : Aaaca8163F) (Appellant) (Respondent) Acit, Circle 1(1) Vs American Express (India) Private Room No.392, C.R. Building, Ltd., I.P. Estate, New Delhi-110002 Metropolitan Saket, 7Th Floor, Office Block, District Centre, Saket, New Delhi.

For Appellant: Shri Nageswar Rao, AdvocateFor Respondent: Shri Rajesh Kumar, CIT DR
Section 271(1)(c)Section 92C

only an error that amount involved has not been mentioned in the chart. Further, it is seen that in the draft assessment order also, the adjustment in this regard is said to be addition of Rs.71,41,54,973/- made to the income of the assessee between difference ... fixed assets. In this scenario, it is the submission of the ld. Counsel for the assessee that no adjustment was made in the draft assessment order and assessee did not file any objection before the ld. DRP. He further submits that while giving effect to DRP directions

Globe Teleservices Limited, Hong Kong vs. The Deputy Commissioner of Income-Tax (International Taxation), Circle-2(1), Bangalore

ITA 349/BANG/2024[2017-18]Status: DisposedITAT Bangalore24 Apr 2024AY 2017-18

Bench: Smt Beena Pillai & Shri Laxmi Prasad Sahuit(It)A Nos. 348 & 349/Bang/2024

For Appellant: Shri Rohan Sogani, CA &For Respondent: Shri A. Sreenivasa Rao, CIT-DR
Section 147Section 191Section 201Section 9(1)(vi)

received by assessee from the Indian company as royalty u/s. 9(1)(vi) of the act r.w.Explanation 2 and 6. 4.3 Against the draft assessment order, the assessee filed the objections before the DRP. The DRP upheld the view of the Ld.AO by relying on the decision