“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

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

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

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

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

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

Hapag-Lloyd Ag, Mumbai vs. Dy CIT (International Taxation)-2(2)(2), Mumbai

The appeal of the assessee is allowed with above directions

ITA 972/MUM/2021[2017-18]Status: DisposedITAT Mumbai31 Jan 2022AY 2017-18

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm Hapag-Lloyd Ag The Dy. Commissioner Of C/O Hapag-Lloyd India Pvt. Income-Tax (International Ltd. Taxation), Range -2(2)(2), Room No. 1606, 16 Th Floor, 403 & 404, Satellite Gazebo, Vs. A Wing, 4Th Floor, Guru Air India Building, Nariman Hargoindji Marg, Andheri Point, Mumbai-400 021 (East), Mumbai-400 093 Appellant .. Respondent Pan No. Aacfe7262L Assessee By : Shri Nishant Thakkar Ms. Jasmin Amalsadvala, Advocates, Revenue By : Shri Milind Chavan, Dr

For Appellant: Shri Nishant ThakkarFor Respondent: Shri Milind Chavan, DR

Section 143Section 234Section 270Section 270ASection 44BSection 90(2)

chargeable as income at 7.5% of total freight. Accordingly, the total income of the assessee was determined at ₹1,29,14,697/-by draft assessment order on 18.12.2019. 06. The assessee filed objection before the DRP, who rejected the objection of the assessee with respect to the taxability and applicability

Deutsche Cib Centre P.Ltd, Mumbai vs. Asst CIT 12(2)(1), Mumbai

In the result, appeal of the assessee is partly allowed for statistical purposes

ITA 2179/MUM/2015[2010-11]Status: DisposedITAT Mumbai31 Jan 2022AY 2010-11

Section 143(3)Section 144C(1)Section 144C(5)Section 37

shares of ultimate holding company vested in certain employees and was claimed by assessee as revenue expenditure. 2.2. The ld. AO vide draft assessment order dated 15.03.2014 passed under section 144C(1) of the Act rejected the claim of the assessee and held that entire expenditure incurred by the assessee ... filed another letter dated 18.03.2014 reiterating its request for considering the revised amount of deduction under section 10A of the Act. 3.2. Vide draft assessment order, the ld. AO though in principle accepted the claim of deduction under section 10A of the Act but rejected the revised claim

Anheuser Busch Inbev India Ltd., Mumbai vs. Pr. CIT-Circle-1, Mumbai

In the result, appeals filed by the assessee are allowed

ITA 942/MUM/2021[2014-15]Status: DisposedITAT Mumbai28 Jan 2022AY 2014-15

Bench: Shri S. Rifaur Rahman, Hon'Ble & Shri Pavan Kumar Gadale, Hon'Ble

For Appellant: Shri Rajan VoraFor Respondent: Ms. Shailja Rai

Section 143(3)Section 263Section 37Section 37(1)

that the Company was claiming deduction for such expenditure. Post analyzing the case, and after due application of mind, the learned AO vide draft assessment order dated 19 December 2016 concluded that the disallowance is to be made on certain other issues and not towards the issue of advertisement

Anheuser Busch Inbev India Ltd., Mumbai vs. Pr CIT, Circle-1, Mumbai

In the result, appeals filed by the assessee are allowed

ITA 941/MUM/2021[2013-14]Status: DisposedITAT Mumbai28 Jan 2022AY 2013-14

Bench: Shri S. Rifaur Rahman, Hon'Ble & Shri Pavan Kumar Gadale, Hon'Ble

For Appellant: Shri Rajan VoraFor Respondent: Ms. Shailja Rai

Section 143(3)Section 263Section 37Section 37(1)

Siemens Ltd, Mumbai vs. DCIT Cir 8(2)(1), Mumbai

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

ITA 1146/MUM/2018[2010-11]Status: DisposedITAT Mumbai28 Jan 2022AY 2010-11

Bench: Shri Pramod Kumar & Shri Pavan Kumar Gadalesiemens Ltd (Successor Vs. Dcit, In Interest To Siemens Corporate Circle - Building Technologies 8(2)(1), Pvt Ltd.,) Room No. 615, 6Th Birla Aurora, Level 20, Floor, Aayakar P.No. 1080, Ar. Annie Bhavan, Mk Road, Besant Road, Worli, Mumbai – 400020. Mumbai – 400030. "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaacs0764L Appellant .. Respondent

For Appellant: Shri. Nitesh Joshi. ARFor Respondent: Shri. Ajit Pal Singh.DR

Section 143(1)Section 143(2)Section 143(3)

Debts written off claim and finally assessed the total income of Rs.38,76,54,136/- and passed the Draft Assesseement order u/sec 143(3) r.w.s.92CA(4) r.w.s 144C of the Act dated28-03-2014.Against the Draft assessment order, the assessee has filed objections in Form no 35A with the DRP, whereas ... existent entity placed at page 40 of the paper book. Finally the A,O, has passed draft Assessment order in the name of “Siemens building technology Pvt Ltd ( presently merged and known as “Siemens Ltd”). The DRP has wrongly mentioned the name of the entity in its order u/sec144C

ACIT, Circle-11(2), New Delhi vs. Humboldt Wedag India Pvt. Ltd., New Delhi

In the result, a. Provision for liquidated damages is allowed

ITA 7147/DEL/2018[2009-10]Status: DisposedITAT Delhi28 Jan 2022AY 2009-10

Bench: Sh. A. D. Jain, Vice-Dr. B. R. R. Kumarita No. 7147/Del/2018 : Asstt. Year : 2009-10 Acit, Vs Humboldt Wedag India Pvt. Ltd., Circle-11(2), A-36, Mehtab House, Mohan Co- New Delhi Operative Industrial Area, Mathura Road, New Delhi-110044 (Appellant) (Respondent) Pan No. Aaach7474G Assessee By : Sh. S. K. Aggarwal, Ca Revenue By : Ms. Meenakshi J. Goswani, Cit Dr Date Of Hearing: 25.10.2021 Date Of Pronouncement: 28.01.2022

For Appellant: Sh. S. K. Aggarwal, CAFor Respondent: Ms. Meenakshi J. Goswani, CIT DR

entitlement is a balance sheet item, which can be claimed after necessary condition are fulfilled in specified period and would lapse. From the draft assessment order it is noticed that DEPB entitlement on export was credited, as income in the P&L account which has now been written

Standard Chartered Bank, Mumbai vs. DDIT (It) 2(1), Mumbai

In the result, Appeal filed by the assessee is allowed quashing reopening of assessment and deleting addition on the merits

ITA 7432/MUM/2012[2005-06]Status: DisposedITAT Mumbai27 Jan 2022AY 2005-06

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm Standard Chartered Bank The Dy. Director Of Income- Crescenzo, Tax(International Taxation)- 7Th Floor, C38-39, 2(1), Vs. G Block Bandra Kurla Complex , 1St Floor, Scindia House, Bandra East N.M. Marg, Ballard Pier, Mumbai-400 051 Mumbai-400 038 Appellant .. Respondent Pan No. Aabcs4681D Assessee By : Shri Madhur Agrawal, Advocate Revenue By : Shri Milind Chavan, Dr

For Appellant: ShriFor Respondent: Shri Milind Chavan, DR

Section 133ASection 143(3)Section 144CSection 147Section 148Section 154Section 2(47)Section 45Section 50Section 50C

duty value and the value disclosed in sale deed amounting to ₹9,49,08,709/- was added for Assessment Year 2005-06. The draft assessment order was accordingly passed. 6. Assessee challenged it before the Dispute Resolution Panel-2, Mumbai [The LD DRP] that issued direction on 25th September

Tata Sons Ltd., Mumbai vs. DCIT Cir. - 2(3)(1), Mumbai

In the result, assessee’s appeal is partly allowed and revenue’s appeal is dismissed

ITA 6418/MUM/2016[2010-11]Status: DisposedITAT Mumbai21 Jan 2022AY 2010-11

Bench: Shri S.Rifaur Rahman ( & Shri Pavan Kumar Gadale ()

For Appellant: 1) Transfer Pricing Adjustment - Guarantee Fees

Section 115JSection 143(1)Section 143(3)Section 14ASection 37Section 92C

under section 92CA(1) of the Act. On receipt of the order u/s 92CA(3) from the Transfer Pricing Officer, a draft assessment order us 144C(1) was passed by the assessing officer. In response, assessee, vide letter dated 25/04/2013 has submitted that it preferred to file appeal before

ACIT, Cir.-2(3)(1), Mumbai vs. Tata Sons Ltd., Mumbai

In the result, assessee’s appeal is partly allowed and revenue’s appeal is dismissed

ITA 6402/MUM/2016[2010-11]Status: DisposedITAT Mumbai21 Jan 2022AY 2010-11

Bench: Shri S.Rifaur Rahman ( & Shri Pavan Kumar Gadale ()

For Appellant: 1) Transfer Pricing Adjustment - Guarantee Fees

Section 115JSection 143(1)Section 143(3)Section 14ASection 37Section 92C

Societe Generale Global Solution Centre Pvt Ltd, Bengaluru vs. Deputy Commissioner of Income Tax, Circle-6(1)(2), Bengaluru

In the result, the assessee’s appeal is partly allowed

ITA 2580/BANG/2017[2013-14]Status: DisposedITAT Bangalore21 Jan 2022AY 2013-14

Bench: Shri N.V. Vasudevan & Shri Chandra Poojari

For Appellant: Shri T. Suryanarayana, Sr. CounselFor Respondent: Dr. Manjunath Karkihalli, CIT(DR)(ITAT), Bengaluru

Section 10ASection 115JSection 143(3)Section 271Section 274

total income of the Appellant on account of adjustment to the arm's length price pertaining to recovery of expenses. (b) The draft / assessment order issued by the Ld. AO, is bad on facts and in law, and is in violation of the principles of natural justice Mark ... erred in law and on facts in not taking cognizance of the objections filed by the Appellant in relation to the draft assessment order issued by the Ld. AO TP order and confirming the draft order of the Ld. AO. 6 Penalty proceedings The Appellant submits that based

Cisco Systems Services B.V, Bangalore vs. Deputy Commissioner of Income Tax International Taxation Circle-1(1), Bangalore

In the result, the appeal by the assessee is allowed

ITA 961/BANG/2017[2012-13]Status: DisposedITAT Bangalore19 Jan 2022AY 2012-13

Bench: Shri. Chandra Poojari & Smt. Beena Pillaiit(It)A No. 961/Bang/2017 Assessment Year : 2012-13 M/S. Cisco Systems Services B.V. – India The Deputy Branch, Commissioner Of Brigade South Parade, Income Tax, No. 10, International Taxation, Mahatma Gandhi Road, Circle – 1(1), Vs. Bangalore – 560 001. Bangalore. Pan: Aaccc4836D Appellant Respondent Assessee By : Shri Rajan Vora, Ca : Dr. Manjunath Karkaihalli, Revenue By Cit Dr Date Of Hearing : 19-01-2022 Date Of Pronouncement : 19-01-2022 Order Per Beena Pillaithis Appeal By Assessee Is Directed Against The Order Of The Ld.Ao Dated 27.02.2017 Passed U/S. 143(3) R.W.S. 144C(14) Of The Income- Tax Act, 1961 [The Act] On The Following Grounds: “Based On The Facts & Circumstances Of The Case & In Law, Cisco Systems Services B.V. - India Branch (Hereinafter Referred To As The 'Appellant.) Respectfully Craves Leave To Prefer An Appeal Against The Order Passed By The Deputy Commissioner Of Income-Tax (International Taxation) - Circle 1(1) ('Assessing Officer' Or 'Ao') Dated February 27, 2017 In Pursuance Of The Directions & The Revised Directions Issued By The Dispute Resolution Panel ('Drp'), Bangalore Dated December 29, 2016 & January 16. 2017 Respectively, Under Section 253 Of The Income-Tax Act, 1961 ('Act) On The Following Grounds:

For Appellant: Shri Rajan Vora, CA

Section 143(3)Section 253Section 92C

addition to the grounds of appeal filed previously by the Appellant on April 28, 2017 which is detailed herein below: Validity of draft assessment order 22. The learned AO has erred in issuing the notice of demand under section 156 of the Act and notice initiating penalty proceeding under section ... along with draft assessment order and thereby making the same as final order and thus, not following the provisions of section 144C of the Act and hence, the order passed by the learned AO is bad in law and merits to be quashed. The Appellant craves leave to add, alter

Xchanging Solutions Limited, Bangalore vs. ITO, Bangalore

In the result, the appeals of the assessee are partly allowed and that of the revenue are dismissed

ITA 556/BANG/2016[2011-12]Status: DisposedITAT Bangalore19 Jan 2022AY 2011-12

Bench: Shri N.V. Vasudevan & Shri Chandra Poojari

For Appellant: Shri Vikram Raghavan, AdvocateFor Respondent: Shri Arunkumar, CIT(DR)(TP)(ITAT), Bengaluru

Section 10ASection 10A(4)Section 143(3)Section 155

dismissed. 7. Ground No.5 was not pressed before us, hence dismissed accordingly. 8. Regarding ground No.6, it was submitted that in the draft assessment order, deduction u/s. 10A for Bangalore BPO Unit was restricted to total income (under the head business) after set off of losses from other units

ITO, Bangalore vs. M/S Xchanging Solutions Ltd., Bangalore

In the result, the appeals of the assessee are partly allowed and that of the revenue are dismissed

ITA 402/BANG/2016[2011-12]Status: DisposedITAT Bangalore19 Jan 2022AY 2011-12

Bench: Shri N.V. Vasudevan & Shri Chandra Poojari

For Appellant: Shri Vikram Raghavan, AdvocateFor Respondent: Shri Arunkumar, CIT(DR)(TP)(ITAT), Bengaluru

Section 10ASection 10A(4)Section 143(3)Section 155

Xchanging Solutions Limited, Bangalore vs. DCIT, Bangalore

In the result, the appeals of the assessee are partly allowed and that of the revenue are dismissed

ITA 492/BANG/2015[2010-11]Status: DisposedITAT Bangalore19 Jan 2022AY 2010-11

Bench: Shri N.V. Vasudevan & Shri Chandra Poojari

For Appellant: Shri Vikram Raghavan, AdvocateFor Respondent: Shri Arunkumar, CIT(DR)(TP)(ITAT), Bengaluru

Section 10ASection 10A(4)Section 143(3)Section 155

DCIT, Bangalore vs. M/S Xchanging Solutions Ltd., Bangalore

In the result, the appeals of the assessee are partly allowed and that of the revenue are dismissed

ITA 459/BANG/2015[2010-11]Status: DisposedITAT Bangalore19 Jan 2022AY 2010-11

Bench: Shri N.V. Vasudevan & Shri Chandra Poojari

For Appellant: Shri Vikram Raghavan, AdvocateFor Respondent: Shri Arunkumar, CIT(DR)(TP)(ITAT), Bengaluru

Section 10ASection 10A(4)Section 143(3)Section 155

Gemological Research (Thailand) Co. Ltd., Mumbai vs. The ACIT (International Taxation) Centre-2(3)(2), Mumbai

In the result, appeal of the assessee is allowed

ITA 978/MUM/2021[2017-18]Status: DisposedITAT Mumbai17 Jan 2022AY 2017-18

Section 143(3)Section 144C(5)

assessee asserted that the facts and the nature of transaction in the present case are identical. The Assessing Officer while passing the draft assessment order has ditto the assessment order in the case of GIA-US for AY 2011-12. The Assessing Officer has verbatim adopted the findings of assessment ... Officer has placed extensive reliance on the assessment order for AY 2011-12 in the case of GIA-US. The Assessing Officer in draft assessment order has verbatim quoted afore said assessment order. In fact, the Assessing Officer has not given independent findings and has merely adopted the findings given

Olympus Medical Systems India Pvt. Ltd., Gurugram vs. ACIT, Circle- 3(1), Gurugram

In the result, appeal of the assessee in ITA No

ITA 873/DEL/2021[2016-17]Status: HeardITAT Delhi13 Jan 2022AY 2016-17

Bench: Shri Saktijit Dey & Shri N.K. Billaiya

For Appellant: Shri Nageshwar Rao, AdvFor Respondent: Shri Mahesh Shah, CIT-DR

Section 143(3)Section 144B

decisions relied upon duly considered. 5. Briefly stated, the facts of the case are that vide order dated 28.11.2019, the AO framed draft assessment order under section 143(3) r.w.s 144C of the Act wherein a reference under section 92CA(1) of the Act was made to the Transfer Pricing ... accordance with Explanation 7 of the same.” 6. Vide order dated 21.12.2019, post rectification under section 154 of the Act, the AO framed draft assessment order. 7. The assessee raised objections before the DRP. 8. The DRP disposed of the objections of the assessee vide order dated 17.03.2021. The relevant

M/S. Cisco Systems Services B.V. India Branch, Bengaluru vs. Deputy Commissioner of Income Tax, International Taxation, Circle- 1(1), Bangalore

In the result, the appeal by the assessee is allowed

ITA 2572/BANG/2019[2011-12]Status: DisposedITAT Bangalore12 Jan 2022AY 2011-12

Bench: Shri. Chandra Poojari & Smt. Beena Pillaiit(It)A No. 2572/Bang/2019 Assessment Year : 2011-12 M/S. Cisco Systems Services B.V. – India The Deputy Branch, Commissioner Of Brigade South Parade, Income Tax, No. 10, Mahatma Gandhi International Taxation, Road, Circle – 1(1), Vs. Bangalore – 560 001. Bangalore. Pan: Aaccc4836D Appellant Respondent Assessee By : Shri Rajan Vora, Ca Revenue By : Shri Pradeep Kumar, Cit (Dr) Date Of Hearing : 04-01-2022 Date Of Pronouncement : 12-01-2022 Order Per Beena Pillaithis Appeal By Assessee Is Directed Against The Order Of The Ld.Ao Dated 31.12.2015 Passed U/S. 143(3) R.W.S. 144C(13) Of The Income-Tax Act, 1961 [The Act] On The Following Grounds: “Based On The Facts & Circumstances Of The Case & In Law, Cisco Systems Services B.V. —India Branch (Hereinafter Referred To As 'The Appellant'), Respectfully Craves Leave To Prefer An Appeal Against The Order Passed By The Learned Assessing Officer (Hereinafter Referred To As The 'Learned Ao') Dated October 15, 2019 Under Section 147 Read With Section 143(3) Read With Section 144C Of The Income-Tax Act, 1961 (`The Act') Pursuant To The Directions Dated September 23, 2019 Issued By The Drp U/S 144C(5) Of The Act ('The Impugned Order') Inter-Alia On The Following Grounds:

For Appellant: Shri Rajan Vora, CAFor Respondent: Shri Pradeep Kumar, CIT (DR)

Section 143(3)Section 144CSection 144C(13)Section 144C(5)Section 147Section 156Section 234BSection 271(1)(c)Section 92C(2)

price is already being disputed by the Assessee before the Hon'ble Income Tax Appellate Tribunal in the original assessment proceedings; Validity of draft assessment order 4. Erred in issuing the notice of demand under section 156 of the Act and notice initiating penalty proceeding under section ... along with draft assessment order and thereby making the same as final order and thus, not following the provisions of section 144C of the Act and hence, the order passed by the learned AO is bad in law and merits to be quashed. Additions made on the basis

M/S Arctern Consulting Pvt Ltd, Bangalore vs. Income Tax Officer Ward-1(1)(2), Bangalore

ITA 352/BANG/2019[2009-10]Status: HeardITAT Bangalore11 Jan 2022AY 2009-10

Section 143(3)Section 144CSection 92(1)

which a TP Adjustment was made by the TPO to an extent of Rs.2,32,81,079/-. Initially, a draft assessment order dated 15.03.2013 under section 143(3) read with section 144C of the Income-tax Act, 1951 (“the Act”) came to be passed by the Assessing Officer

M/S Infor (Bangalore) Private Limited, Bangalore vs. Deputy Commissioner of Income Tax Circle-3(1)(1), Bangalore

In the result, the appeal is partly allowed

ITA 3188/BANG/2018[2005-06]Status: DisposedITAT Bangalore11 Jan 2022AY 2005-06

Bench: Shri N.V. Vasudevan & Shri Chandra Poojariassessment Year : 2005-06 M/S. Infor (Bangalore) Private Limited, Vs. Dcit, (Previously Softbrands India Private Ltd. & Circle – 3(1)(1), Now Merged With Infor India Private Ltd.,), Bengaluru. 302, 3Rd Floor, Prestige Sigma, #3, Vittal Mallya Road, Bengaluru – 560 001. Pan : Aafcs 9041 K Appellant Respondent Assessee By : Shri. Srinivas K P, Ca Revenue By : Shri. Priyadarshi Mishra, Addl. Cit(Dr)(Itat), Bengaluru Date Of Hearing : 11.01.2022 Date Of Pronouncement : 11.01.2022 O R D E R

For Appellant: Shri. Srinivas K P, CAFor Respondent: Shri. Priyadarshi Mishra, Addl. CIT(DR)(ITAT), Bengaluru

Section 92(1)Section 92C

services by the Assessee to its AE. 7. The Assessee did not file objections before the Disputes Resolution Panel (DRP) against the draft assessment order passed by the AO wherein the addition suggested by the TPO as adjustment to ALP was added to the total income of the Assessee