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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

Rga International Reinsurance Company Designated Authority Compqny, Mumbai vs. DCIT (International Taxation) 4(1) (1), Mumbai

In the result, appeal filed by the assessee is allowed

ITA 803/MUM/2022[2018-19]Status: DisposedITAT Mumbai06 Sept 2023AY 2018-19

Bench: Shri S. Rifaur Rahman, Hon'Ble & Shri Rahul Chaudhary, Hon'Ble

Section 143(2)Section 144C(5)

matter in detail. Coming back to the fixed place permanent establishment case of the Assessing Officer, as put to the assessee in the draft assessment order, the assessee raised objection before the Dispute Resolution Panel. It was submitted by the assessee that the assessee does not have any place

Hireright Ltd, Uk vs. ACIT, Circle 2(1)(1), International Taxation, New Delhi

In the result, the appeals of the assessee for both the AYs 2019-20

ITA 373/DEL/2023[2020-21]Status: DisposedITAT Delhi06 Sept 2023AY 2020-21

Bench: Shri G.S. Pannu, Hon’Ble & Ms. Astha Chandraasstt. Year: 2020-21 & Asstt. Year: 2019-20

For Appellant: Shri Ajay Vohra, Sr. AdvocateFor Respondent: Shri Vizay B. Vasanta, CIT-DR
Section 143(3)Section 234ASection 234DSection 270A

assessee are ancillary to the alleged ‘royalties’ and therefore also taxable as FTS. Accordingly, the Ld. AO proceeded to pass the draft assessment order on 29.09.2021 for AY 2019-20 and on 08.03.2022 for AY 2020-21 proposing to assess the income of the assessee ... basis of the Assessee's findings. 6 & ITA No. 1884/Del/2022 The assumption and assertions made by the Ld. AO in the draft assessment order are based on incorrect understanding of the facts in the present case. In totality of the above, it is respectfully submitted that the consideration received

Hireright Limited, London vs. ACIT, Circle 2(1)(1), Int. Tax, New Delhi

In the result, the appeals of the assessee for both the AYs 2019-20

ITA 1884/DEL/2022[2019-20]Status: DisposedITAT Delhi06 Sept 2023AY 2019-20

Bench: Shri G.S. Pannu, Hon’Ble & Ms. Astha Chandraasstt. Year: 2020-21 & Asstt. Year: 2019-20

For Appellant: Shri Ajay Vohra, Sr. AdvocateFor Respondent: Shri Vizay B. Vasanta, CIT-DR
Section 143(3)Section 234ASection 234DSection 270A

assessee are ancillary to the alleged ‘royalties’ and therefore also taxable as FTS. Accordingly, the Ld. AO proceeded to pass the draft assessment order on 29.09.2021 for AY 2019-20 and on 08.03.2022 for AY 2020-21 proposing to assess the income of the assessee ... basis of the Assessee's findings. 6 & ITA No. 1884/Del/2022 The assumption and assertions made by the Ld. AO in the draft assessment order are based on incorrect understanding of the facts in the present case. In totality of the above, it is respectfully submitted that the consideration received

Amadoroco Ltd, Cyprus vs. ACIT, Circle-1(1)(1) (International Taxation), New Delhi

In the result, the appeal of the assessee is allowed

ITA 1007/DEL/2020[2014-15]Status: DisposedITAT Delhi06 Sept 2023AY 2014-15

Bench: Shri G.S. Pannu, Hon’Ble & Ms. Astha Chandraasstt. Year: 2014-15

For Appellant: S/Sh. Amit Sharma, Sumit JainFor Respondent: Shri Vizay B. Vasanta, CIT-DR
Section 143(3)Section 144CSection 263

erred in passing the final assessment order without recoursing the statutory requirements of Section 144C of the Act of passing the draft assessment order before passing final assessment order and therefore the impugned assessment order passed u/s 143(3) r.w.s

DCIT 14 (3)(1), Mumbai vs. Tata Communications Transformation Services Ltd., Mumbai

In the result, the appeal filed by the assessee is allowed and the appeal filed by the

ITA 6240/MUM/2019[2008-09]Status: DisposedITAT Mumbai05 Sept 2023AY 2008-09

Bench: Shri B R Baskaran, Am & Ms. Kavitha Rajagopal, Jm Tata Communications Transformations Dy. Cit (Tp)-4(2)(1) Air India Building, 5Th Floor, Services Limited Vs. D-21/C 36, G Block Bandra Kurla Nariman Point, Mumbai-400 021 Complex, Mumbai-400 008 Pan/Gir No. Aaccv 3189 A (Assessee) : (Revenue) & Dy. Cit-14(3)(1) Tata Communications 4Th Floor, Room No. 455, Aayakar Transformation Services Ltd. Bhavan, M. K. Road, Mumbai-400 020 Plot No. C-21 & C-36 C Tower, Vs. Bkc Vidyanagri Po, Bandra Kurla Complex, Bandra (E), Mumbai-400 098 Pan/Gir No. Aaccv 3189 Q (Revenue) : (Assessee)

For Appellant: Shri Nitesh Joshi
Section 143(1)Section 143(2)Section 143(3)Section 144CSection 2Section 92C

6240/Mum/2019 (A.Y. 2008-09) Tata Communications Transformation Services Ltd. 143(3) r.w.s. 254 of the Act dated 28.01.2016 without passing the draft assessment order as per the provision of section 144C of the Act. 3. The brief facts are that the assessee is engaged in the business of providing Telecommunication ... respect to provision of Telecommunication Network Management Service and provision of Finance and Accounting services (administrative support services). The ld. A.O. passed the draft assessment order dated 12.12.2011. The assessee filed its objection before the ld.DRP against the adjustment proposed by the ld. TPO/A.O. and the ld. DRP vide order

Tata Communications Transformations Services Limited, Mumbai vs. Dict (Tp)-4(2)(1, Mumbai

In the result, the appeal filed by the assessee is allowed and the appeal filed by the

ITA 5882/MUM/2019[2008-09]Status: DisposedITAT Mumbai05 Sept 2023AY 2008-09

Bench: Shri B R Baskaran, Am & Ms. Kavitha Rajagopal, Jm Tata Communications Transformations Dy. Cit (Tp)-4(2)(1) Air India Building, 5Th Floor, Services Limited Vs. D-21/C 36, G Block Bandra Kurla Nariman Point, Mumbai-400 021 Complex, Mumbai-400 008 Pan/Gir No. Aaccv 3189 A (Assessee) : (Revenue) & Dy. Cit-14(3)(1) Tata Communications 4Th Floor, Room No. 455, Aayakar Transformation Services Ltd. Bhavan, M. K. Road, Mumbai-400 020 Plot No. C-21 & C-36 C Tower, Vs. Bkc Vidyanagri Po, Bandra Kurla Complex, Bandra (E), Mumbai-400 098 Pan/Gir No. Aaccv 3189 Q (Revenue) : (Assessee)

For Appellant: Shri Nitesh Joshi
Section 143(1)Section 143(2)Section 143(3)Section 144CSection 2Section 92C

6240/Mum/2019 (A.Y. 2008-09) Tata Communications Transformation Services Ltd. 143(3) r.w.s. 254 of the Act dated 28.01.2016 without passing the draft assessment order as per the provision of section 144C of the Act. 3. The brief facts are that the assessee is engaged in the business of providing Telecommunication ... respect to provision of Telecommunication Network Management Service and provision of Finance and Accounting services (administrative support services). The ld. A.O. passed the draft assessment order dated 12.12.2011. The assessee filed its objection before the ld.DRP against the adjustment proposed by the ld. TPO/A.O. and the ld. DRP vide order

Ntt India Pvt. Ltd, Mumbai vs. Addl/Jt/Dy/ACIT/Tax/ITO, Delhi

In the result, the appeal filed by the assessee is allowed

ITA 722/MUM/2022[2017-18]Status: DisposedITAT Mumbai04 Sept 2023AY 2017-18

Bench: Shri B R Baskaran, Am & Ms. Kavitha Rajagopal, Jm Ntt India Pvt. Ltd. Addl/Jt/Dy./Acit/Tax/Ito 1701-1704, B-Wing, One Bkc Level, National Faceless Assessment Centre 17 G Block, Plot No. C-65, Vs. Delhi Bandra Kurla Complex, Bandra (E), Mumbai-400 051 Pan/Gir No. Aaacd 2145 G (Appellant) : (Respondent) Assessee By : Shri Vijay Mehta : Shri Sunil A Umap & Revenue By Shri Samuel Pitta Date Of Hearing : 06.06.2023 : 04.09.2023 Date Of Pronouncement

For Appellant: Shri Vijay Mehta
Section 143(3)

adjustment of Rs.121,24,85,623/- to the international transaction with regard to the allocation of management fees. The A.O. passed the draft assessment order dated 30.03.2021 u/s. 144C(1) of the Act after duly considering the proposed adjustment made by the TPO. The assessee had preferred an objection before

Kellogg India P.Ltd, Mumbai vs. Assistant Commissioner of Income Tax 15(1)(2), Mumbai

In the result, appeal filed by the Assessee stands partly allowed

ITA 2533/MUM/2022[2018-19]Status: DisposedITAT Mumbai31 Aug 2023AY 2018-19

Bench: Shri Br Baskaran, Am & Shri N. K. Choudhry, Jm

For Appellant: Ms. Hirali Desai/ Mr. AmolFor Respondent: Vachaspati Tripathi, Ld. CIT
Section 143(2)Section 144CSection 144C(2)Section 250Section 270ASection 274Section 40Section 92C

seminar expenses of Rs.58,30,192/- and Repairs to Buildings expenses of Rs.99,32,105/-. 2.6 The Assessee being aggrieved with the Draft assessment order, preferred objections under section 144C(2) of the Act on 26/10/2021 before the Dispute Resolution Panel-1, Mumbai, who vide order dated

Mondelez India Foods P.Ltd, Mumbai vs. Asst CIT RG 5(1)(2), Mumbai

ITA 1518/MUM/2017[2012-13]Status: DisposedITAT Mumbai31 Aug 2023AY 2012-13

Bench: Vikas Awasthy () & Ms. Padmavathy S. ()

Section 143(3)Section 144C(13)Section 14ASection 234ASection 234C

with its AEs. The TPO, vide order dated 27/01/2015 proposed a total adjustment of Rs.199,53,59,553/-. The Assessing Officer passed the draft assessment order incorporating the TP adjustment and also made the following additions/disallowances:- (1) Depreciation claimed on marketing know how Rs. 5,39,988/- (2) Disallowance under ... Addition on account of difference in AIR 4. The Assessing Officer passed a draft assessment order against which the assessee raised objections before the DRP. The DRP gave marginal relief to the assessee with respect of depreciation claimed on marketing know how and sustained the TP adjustment as well

Imperial Mark Trade (I) P.Ltd, Thane vs. DCIT CC 7(2), Mumbai

In the result, the appeal by the assessee is allowed for statistical purposes

ITA 1453/MUM/2017[2013-14]Status: DisposedITAT Mumbai31 Aug 2023AY 2013-14

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Shri Ajay R. SinghFor Respondent: Shri Manoj Kumar
Section 143(3)Section 144C(13)Section 144C(5)Section 254(1)Section 92C

assessee, it was observed that the assessee has made transactions of high seas purchase and sale of commodities. The AO vide draft assessment order dated 29/03/2016 passed under section 143(3) read with section 144C(1) of the Act disallowed loss on high seas sales ... assessee, it has earned a profit of Rs. 13,05,01,658. However, as is evident from page no. 3 of the draft assessment order, the AO considered the purchase amounting to Rs. 327,19,29,222 and sales amounting to Rs. 318,26,38,481. Accordingly, the AO arrived

Mondelez India Foods P. Ltd, Mumbai vs. DCIT RG 5(1)(2), Mumbai

ITA 1240/MUM/2016[2011-12]Status: DisposedITAT Mumbai31 Aug 2023AY 2011-12

Bench: Vikas Awasthy () & Ms. Padmavathy S. ()

Section 143(3)Section 144C(13)Section 14ASection 234ASection 234C

with its AEs. The TPO, vide order dated 27/01/2015 proposed a total adjustment of Rs.199,53,59,553/-. The Assessing Officer passed the draft assessment order incorporating the TP adjustment and also made the following additions/disallowances:- (1) Depreciation claimed on marketing know how Rs. 5,39,988/- (2) Disallowance under ... Addition on account of difference in AIR 4. The Assessing Officer passed a draft assessment order against which the assessee raised objections before the DRP. The DRP gave marginal relief to the assessee with respect of depreciation claimed on marketing know how and sustained the TP adjustment as well

Anu Kumar, Patna vs. Deputy/ACIT Central Circle-2, Patna

In the result, all the appeals of the assessee are allowed for statistical purposes

ITA 60/PAT/2023[2019-20]Status: DisposedITAT Patna31 Aug 2023AY 2019-20

Bench: Shri Sanjay Garg & Shri Girish Agrawal

For Appellant: Shri Rakesh Kumar, AdvocateFor Respondent: Smt. Rinku Singh, CIT, DR
Section 144BSection 144B(6)(vii)Section 144B(7)(vii)Section 250

viii) 144B(7)(vii) “(7) For the purposes of faceless assessment— (vii) in a case where a variation is proposed in the draft assessment order or final draft assessment order or revised draft assessment order, and an opportunity is provided to the assessee by serving a notice calling upon ... show cause as to why the assessment should not be completed as per the such draft or final draft or revised draft assessment order, the assessee or his authorised representative, as the case may be, may request for personal hearing so as to make his oral submissions or present

Anu Kumar, Patna vs. Deputy/ACIT Central Circle-2, Patna

In the result, all the appeals of the assessee are allowed for statistical purposes

ITA 59/PAT/2023[2018-19]Status: DisposedITAT Patna31 Aug 2023AY 2018-19

Bench: Shri Sanjay Garg & Shri Girish Agrawal

For Appellant: Shri Rakesh Kumar, AdvocateFor Respondent: Smt. Rinku Singh, CIT, DR
Section 144BSection 144B(6)(vii)Section 144B(7)(vii)Section 250

viii) 144B(7)(vii) “(7) For the purposes of faceless assessment— (vii) in a case where a variation is proposed in the draft assessment order or final draft assessment order or revised draft assessment order, and an opportunity is provided to the assessee by serving a notice calling upon ... show cause as to why the assessment should not be completed as per the such draft or final draft or revised draft assessment order, the assessee or his authorised representative, as the case may be, may request for personal hearing so as to make his oral submissions or present

Anu Kumar, Patna vs. Deputy/ACIT Central Circle-2, Patna

In the result, all the appeals of the assessee are allowed for statistical purposes

ITA 58/PAT/2023[2017-18]Status: DisposedITAT Patna31 Aug 2023AY 2017-18

Bench: Shri Sanjay Garg & Shri Girish Agrawal

For Appellant: Shri Rakesh Kumar, AdvocateFor Respondent: Smt. Rinku Singh, CIT, DR
Section 144BSection 144B(6)(vii)Section 144B(7)(vii)Section 250

viii) 144B(7)(vii) “(7) For the purposes of faceless assessment— (vii) in a case where a variation is proposed in the draft assessment order or final draft assessment order or revised draft assessment order, and an opportunity is provided to the assessee by serving a notice calling upon ... show cause as to why the assessment should not be completed as per the such draft or final draft or revised draft assessment order, the assessee or his authorised representative, as the case may be, may request for personal hearing so as to make his oral submissions or present

Anu Kumar, Patna vs. Deputy/ACIT Central Circle-2, Patna

In the result, all the appeals of the assessee are allowed for statistical purposes

ITA 57/PAT/2023[2016-17]Status: DisposedITAT Patna31 Aug 2023AY 2016-17

Bench: Shri Sanjay Garg & Shri Girish Agrawal

For Appellant: Shri Rakesh Kumar, AdvocateFor Respondent: Smt. Rinku Singh, CIT, DR
Section 144BSection 144B(6)(vii)Section 144B(7)(vii)Section 250

viii) 144B(7)(vii) “(7) For the purposes of faceless assessment— (vii) in a case where a variation is proposed in the draft assessment order or final draft assessment order or revised draft assessment order, and an opportunity is provided to the assessee by serving a notice calling upon ... show cause as to why the assessment should not be completed as per the such draft or final draft or revised draft assessment order, the assessee or his authorised representative, as the case may be, may request for personal hearing so as to make his oral submissions or present

Anu Kumar, Patna vs. Deputy/ACIT Central Circle-2, Patna

In the result, all the appeals of the assessee are allowed for statistical purposes

ITA 55/PAT/2023[2014-15]Status: DisposedITAT Patna31 Aug 2023AY 2014-15

Bench: Shri Sanjay Garg & Shri Girish Agrawal

For Appellant: Shri Rakesh Kumar, AdvocateFor Respondent: Smt. Rinku Singh, CIT, DR
Section 144BSection 144B(6)(vii)Section 144B(7)(vii)Section 250

viii) 144B(7)(vii) “(7) For the purposes of faceless assessment— (vii) in a case where a variation is proposed in the draft assessment order or final draft assessment order or revised draft assessment order, and an opportunity is provided to the assessee by serving a notice calling upon ... show cause as to why the assessment should not be completed as per the such draft or final draft or revised draft assessment order, the assessee or his authorised representative, as the case may be, may request for personal hearing so as to make his oral submissions or present

Anu Kumar, Patna vs. Deputy/ACIT Central Circle-2, Patna

In the result, all the appeals of the assessee are allowed for statistical purposes

ITA 54/PAT/2023[2013-14]Status: DisposedITAT Patna31 Aug 2023AY 2013-14

Bench: Shri Sanjay Garg & Shri Girish Agrawal

For Appellant: Shri Rakesh Kumar, AdvocateFor Respondent: Smt. Rinku Singh, CIT, DR
Section 144BSection 144B(6)(vii)Section 144B(7)(vii)Section 250

viii) 144B(7)(vii) “(7) For the purposes of faceless assessment— (vii) in a case where a variation is proposed in the draft assessment order or final draft assessment order or revised draft assessment order, and an opportunity is provided to the assessee by serving a notice calling upon ... show cause as to why the assessment should not be completed as per the such draft or final draft or revised draft assessment order, the assessee or his authorised representative, as the case may be, may request for personal hearing so as to make his oral submissions or present

Bombardier Transportation Signal (Thailand) Limited, Thailand vs. ACIT, Circle Int. Taxation 1(1)(2), New Delhi

In the result, three appeals of the assessee are partly allowed as indicated above

ITA 726/DEL/2023[2016-17]Status: DisposedITAT Delhi31 Aug 2023AY 2016-17

Bench: Shri Narendra Kumar Billaiya & Shri Challa Nagendra Prasad

For Appellant: Shri Anubhav Rastogi, &
Section 143(2)Section 143(3)Section 144CSection 144C(1)Section 263Section 90(2)

direction to the Assessing Officer to make fresh assessment. Pursuant to the order passed by the CIT (International Taxation) the Assessing Officer passed draft assessment order under section 144C of the Act dated 29.03.2022 bringing to tax 10% of the income received on off shore supply of equipment of services

Bombardier Transportation Signal (Thailand ) Limited, Thailand vs. DCIT, Circle-1(1)(2) Int. Taxation, Delhi

In the result, three appeals of the assessee are partly allowed as indicated above

ITA 2193/DEL/2022[2019-20]Status: DisposedITAT Delhi31 Aug 2023AY 2019-20

Bench: Shri Narendra Kumar Billaiya & Shri Challa Nagendra Prasad

For Appellant: Shri Anubhav Rastogi, &
Section 143(2)Section 143(3)Section 144CSection 144C(1)Section 263Section 90(2)

direction to the Assessing Officer to make fresh assessment. Pursuant to the order passed by the CIT (International Taxation) the Assessing Officer passed draft assessment order under section 144C of the Act dated 29.03.2022 bringing to tax 10% of the income received on off shore supply of equipment of services

Bombardier Transportation Signal (Thailand ) Limited, Thailand vs. DCIT, Circle 1(1)(2) Int. Taxation, Delhi

In the result, three appeals of the assessee are partly allowed as indicated above

ITA 2192/DEL/2022[2018-19]Status: DisposedITAT Delhi31 Aug 2023AY 2018-19

Bench: Shri Narendra Kumar Billaiya & Shri Challa Nagendra Prasad

For Appellant: Shri Anubhav Rastogi, &
Section 143(2)Section 143(3)Section 144CSection 144C(1)Section 263Section 90(2)

direction to the Assessing Officer to make fresh assessment. Pursuant to the order passed by the CIT (International Taxation) the Assessing Officer passed draft assessment order under section 144C of the Act dated 29.03.2022 bringing to tax 10% of the income received on off shore supply of equipment of services