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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

Magnaquest Technologies Limited, Hyderabad vs. DCIT., Circle-5(1), Hyderabad

In the result, ITA.No.736/Hyd

ITA 736/HYD/2025[2018-19]Status: DisposedITAT Hyderabad24 Sept 2025AY 2018-19

Bench: Shri Vijay Pal Rao & Shri Manjunatha G

For Appellant: CA, G Srinivasa RaoFor Respondent: Dr. Sachin Kumar, Sr. AR
Section 142(1)Section 143(2)Section 143(3)Section 144BSection 250Section 438Section 43B

r.w.s 144B of the Act is bad-in-law as the same was passed without issuing a show-cause notice cum draft assessment order as mandated u/s 144B(xvi)(b) of the Act and hence the impugned assessment order is liable to be quashed. 2. That on the facts ... 743/Hyd./2025 position of law that as the quantum appeal is non-est due to non- issuance of show-cause notice cum draft assessment order before finalizing the assessment, the penalty order passed based on the non-est quantum order is also bad-in-law and is liable

Sushee Infra & Mining Limited, Hyderabad vs. ACIT., Central Circle-2(2), Hyderabad

In the result, appeal of the Assessee is partly

ITA 1390/HYD/2024[2021-22]Status: DisposedITAT Hyderabad24 Sept 2025AY 2021-22

Bench: Shri Vijay Pal Rao & Shri Madhusudan Sawdia

For Appellant: CA Abhiroop BhargavFor Respondent: Dr. Narendra Kumar Naik, CIT-DR
Section 143(3)Section 144C(5)Section 801ASection 801A(10)Section 92BSection 92C(3)Section 92D

rework the deduction u/s 801A of the taxpayer accordingly.” 12. In pursuance to the Order of the TPO, the Assessing Officer passed Draft Assessment Order, whereby made addition of the said amount of Rs.144,33,07,000/- on account of TP adjustment. 13. The assessee challenged the Draft Assessment Order

Virinchi Limited, Hyderabad vs. DCIT., Circle 8(1), Hyderabad

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

ITA 1185/HYD/2024[2021-22]Status: DisposedITAT Hyderabad24 Sept 2025AY 2021-22

Bench: Shri Vijay Pal Rao, Vice-A N D Shri Manjunatha, G.आ.अपी.सं /Ita No.1185/Hyd/2024 (िनधा"रण वष"/Assessment Year: 2021-22) M/S. Virinchi Ltd Vs. Dy.Cit Hyderabad Circle 8(1) Pan:Aaacv6672N Hyderabad (Appellant) (Respondent) िनधा""रती "ारा/Assessee By: Shri P Murali Mohan Rao, Ca राज" व "ारा/Revenue By:: Mrs. U Mini Chandran, Cit(Dr) सुनवाई की तारीख/Date Of Hearing: 25/08/2025 घोषणा की तारीख/Pronouncement: 24/09/2025 आदेश/Order Per Vijay Pal Raothis Appeal By The Assessee Is Directed Against The Assessment Order Dated 09/10/2024 Passed U/S 143(3) R.W.S. 144C(3) Of The Act, In Pursuant To The Directions Of The Drp Dated 19/09/2024 Passed U/S 144C(5) Of The Act For The A.Y 2021-22. 2. The Assessee Has Raised The Following Grounds Of Appeal:

For Appellant: Shri P Murali Mohan Rao, CAFor Respondent: : Mrs. U Mini Chandran, CIT(DR)
Section 143(3)Section 144C(3)Section 144C(5)Section 153

assessee as ‘Nil’ and consequently, proposed the entire payment of Rs.10,10,03,573/- as T.P Adjustment. Thereafter, the Assessing Officer passed a draft assessment order dated 11/12/2023 against which the assessee filed its objections before the DRP but could not succeed as the DRP vide its direction dated 19/09/2024

Celestial Vision Limited, Bvi vs. Assisstant Commissioner of Income Tax Int Tax Circle 2(1)(1), Mumbai

Appeal is allowed for statistical purposes

ITA 1625/MUM/2025[2022-23]Status: DisposedITAT Mumbai24 Sept 2025AY 2022-23

Bench: Smt. Beena Pillai & Smt. Renu Jauhriआयकर अपील सं./Ita No.1625/Mum/2025 (निर्धारण वर्ा/Assessment Year: 2022-23) Celestial Vision V/S. Assistant Commissioner Of Limited बिधम Income Tax Circle 2(1)(1) Po Box No. 146, Road 604, Kautilya Bhawan, G Block, Town, Tortola, British Bandra Kurla Complex, Bandra Virgin Islands (East)400051. 111000. स्थधयी लेखध सं./जीआइआर सं./Pan/Gir No: Aaicc1160A Appellant/अपीलधथी .. Respondent/प्रनिवधदी निर्धाररिी की ओर से /Assessee By: Shri. Vipul J. Shah-Adv. रधजस्व की ओर से /Revenue By: Shri Krishna Kumar Sr Dr सुिवधई की िधरीख / Date Of Hearing 05.08.2025 घोर्णध की िधरीख/Date Of Pronouncement 24.09.2025

For Appellant: Shri. Vipul J. Shah-AdvFor Respondent: Shri Krishna Kumar SR DR
Section 115ASection 144C(5)Section 44BSection 9(1)(vi)

return on 31.12.2022 declaring income of Rs. 89,64,307/- u/s. 44BB of the Act. The case was selected for scrutiny and, vide draft assessment order, the Ld. AO proposed to tax the receipts of Rs. 8,96,43,062/- as income from Royalty. Ld. AO observed that the receipts

Sanjay Garg, Delhi vs. DCIT, Central Circle-8, Delhi

In the result, appeal of the assessee is allowed

ITA 2268/DEL/2025[2017-18]Status: DisposedITAT Delhi24 Sept 2025AY 2017-18

Bench: Shri S. Rifaur Rahman & Shri Anubhav Sharma

For Appellant: Shri Amit Goel, CAFor Respondent: Shri Jitender Singh, CIT DR
Section 153ASection 153DSection 154Section 69

mind. 16. In the present case, the ITAT, while specifically noting that the approval was granted on the same day when the draft assessment orders were sent, has observed as under:- "10. We have gone through the approval granted by the ld. Addl. CIT on 30.12.2018 u/s 153D ... that a letter dated 30.12.2018 was filed by the ld. AO before the ld. Addl. CIT seeking approval of draft assessment order u/s 153D of the Act. The ld. Addl. CIT has accorded approval for the said draft assessment orders on the very same day i.e., on 30.12.2018 for seven

Sanjay Garg, Delhi vs. DCIT, Central Circle- 8, Delhi

In the result, appeal of the assessee is allowed

ITA 2266/DEL/2025[2016-17]Status: DisposedITAT Delhi24 Sept 2025AY 2016-17

Bench: Shri S. Rifaur Rahman & Shri Anubhav Sharma

For Appellant: Shri Amit Goel, CAFor Respondent: Shri Jitender Singh, CIT DR
Section 153ASection 153DSection 154Section 69

mind. 16. In the present case, the ITAT, while specifically noting that the approval was granted on the same day when the draft assessment orders were sent, has observed as under:- "10. We have gone through the approval granted by the ld. Addl. CIT on 30.12.2018 u/s 153D ... that a letter dated 30.12.2018 was filed by the ld. AO before the ld. Addl. CIT seeking approval of draft assessment order u/s 153D of the Act. The ld. Addl. CIT has accorded approval for the said draft assessment orders on the very same day i.e., on 30.12.2018 for seven

Income Tax Officer, Ward 29(1), New Delhi, Delhi vs. Sneh Sharma, Delhi

ITA 2141/DEL/2025[2017-18]Status: DisposedITAT Delhi24 Sept 2025AY 2017-18

Bench: Shri Anubhav Sharma & Shri Manish Agarwal

For Appellant: Shri Anil Bajaj, CAFor Respondent: Shri Manish Gupta, Sr. DR
Section 124(3)Section 143(1)Section 144CSection 144C(1)Section 144C(15)Section 147Section 195

Thus, being an ‘eligible assessee’ for the purpose of section 144C(15) of the Act, the AO was supposed to first issue a draft assessment order u/s 144C(1) of the Act, but, instead the AO has proceeded to pass a final assessment order directly and this jurisdictional infirmity ... provisions and procedure as enshrined u/s 144C of the Act. 5. The ld. DR, on the contrary, has submitted that non-issuance of draft assessment order does not vitiate the final assessment and is not a jurisdictional defect and reliance was placed on the decisions in the cases Abhishek Jain

Income Tax Officer, Ward 29(1), New Delhi, Delhi vs. Sneh Sharma, Delhi

ITA 2140/DEL/2025[2016-17]Status: DisposedITAT Delhi24 Sept 2025AY 2016-17

Bench: Shri Anubhav Sharma & Shri Manish Agarwal

For Appellant: Shri Anil Bajaj, CAFor Respondent: Shri Manish Gupta, Sr. DR
Section 124(3)Section 143(1)Section 144CSection 144C(1)Section 144C(15)Section 147Section 195

Thus, being an ‘eligible assessee’ for the purpose of section 144C(15) of the Act, the AO was supposed to first issue a draft assessment order u/s 144C(1) of the Act, but, instead the AO has proceeded to pass a final assessment order directly and this jurisdictional infirmity ... provisions and procedure as enshrined u/s 144C of the Act. 5. The ld. DR, on the contrary, has submitted that non-issuance of draft assessment order does not vitiate the final assessment and is not a jurisdictional defect and reliance was placed on the decisions in the cases Abhishek Jain

Income Tax Officer, Ward 29(1), New Delhi, Delhi vs. Sneh Sharma, Delhi

ITA 2139/DEL/2025[2015-16]Status: DisposedITAT Delhi24 Sept 2025AY 2015-16

Bench: Shri Anubhav Sharma & Shri Manish Agarwal

For Appellant: Shri Anil Bajaj, CAFor Respondent: Shri Manish Gupta, Sr. DR
Section 124(3)Section 143(1)Section 144CSection 144C(1)Section 144C(15)Section 147Section 195

Thus, being an ‘eligible assessee’ for the purpose of section 144C(15) of the Act, the AO was supposed to first issue a draft assessment order u/s 144C(1) of the Act, but, instead the AO has proceeded to pass a final assessment order directly and this jurisdictional infirmity ... provisions and procedure as enshrined u/s 144C of the Act. 5. The ld. DR, on the contrary, has submitted that non-issuance of draft assessment order does not vitiate the final assessment and is not a jurisdictional defect and reliance was placed on the decisions in the cases Abhishek Jain

Income Tax Officer, Ward 29(1), New Delhi, Delhi vs. Sneh Sharma, Delhi

ITA 2138/DEL/2025[2014-15]Status: DisposedITAT Delhi24 Sept 2025AY 2014-15

Bench: Shri Anubhav Sharma & Shri Manish Agarwal

For Appellant: Shri Anil Bajaj, CAFor Respondent: Shri Manish Gupta, Sr. DR
Section 124(3)Section 143(1)Section 144CSection 144C(1)Section 144C(15)Section 147Section 195

Thus, being an ‘eligible assessee’ for the purpose of section 144C(15) of the Act, the AO was supposed to first issue a draft assessment order u/s 144C(1) of the Act, but, instead the AO has proceeded to pass a final assessment order directly and this jurisdictional infirmity ... provisions and procedure as enshrined u/s 144C of the Act. 5. The ld. DR, on the contrary, has submitted that non-issuance of draft assessment order does not vitiate the final assessment and is not a jurisdictional defect and reliance was placed on the decisions in the cases Abhishek Jain

Income Tax Officer, Ward-29(1) Delhi, Delhi vs. Sneh Sharma, Delhi

ITA 2137/DEL/2025[2013-14]Status: DisposedITAT Delhi24 Sept 2025AY 2013-14

Bench: Shri Anubhav Sharma & Shri Manish Agarwal

For Appellant: Shri Anil Bajaj, CAFor Respondent: Shri Manish Gupta, Sr. DR
Section 124(3)Section 143(1)Section 144CSection 144C(1)Section 144C(15)Section 147Section 195

Thus, being an ‘eligible assessee’ for the purpose of section 144C(15) of the Act, the AO was supposed to first issue a draft assessment order u/s 144C(1) of the Act, but, instead the AO has proceeded to pass a final assessment order directly and this jurisdictional infirmity ... provisions and procedure as enshrined u/s 144C of the Act. 5. The ld. DR, on the contrary, has submitted that non-issuance of draft assessment order does not vitiate the final assessment and is not a jurisdictional defect and reliance was placed on the decisions in the cases Abhishek Jain

Income Tax Officer, Ward 29(1), New Delhi vs. Sneh Sharma, New Delhi

ITA 2136/DEL/2025[2012-13]Status: DisposedITAT Delhi24 Sept 2025AY 2012-13

Bench: Shri Anubhav Sharma & Shri Manish Agarwal

For Appellant: Shri Anil Bajaj, CAFor Respondent: Shri Manish Gupta, Sr. DR
Section 124(3)Section 143(1)Section 144CSection 144C(1)Section 144C(15)Section 147Section 195

Thus, being an ‘eligible assessee’ for the purpose of section 144C(15) of the Act, the AO was supposed to first issue a draft assessment order u/s 144C(1) of the Act, but, instead the AO has proceeded to pass a final assessment order directly and this jurisdictional infirmity ... provisions and procedure as enshrined u/s 144C of the Act. 5. The ld. DR, on the contrary, has submitted that non-issuance of draft assessment order does not vitiate the final assessment and is not a jurisdictional defect and reliance was placed on the decisions in the cases Abhishek Jain

Nanak Chand Tayal, Faridabad Haryana vs. Dy Commissioner of Income Tax Central Circle 2 Faridabad, Faridabad Haryana

The appeals of the assessee are allowed

ITA 1615/DEL/2025[2017-18]Status: DisposedITAT Delhi24 Sept 2025AY 2017-18

Bench: Shri Anubhav Sharma & Shri Krinwant Sahay

For Appellant: Dr. Rakesh Gupta, Advocate &For Respondent: Shri Mahesh Kumar, CIT-DR
Section 153ASection 153D

gone through the seized material, assessment records including the replies filed by the assessee with reference to the additions/ disallowance proposed in the drafts assessment order. Rather the Addl. CIT referred the action of the AO in making enquiries and considering all the material and providing sufficient opportunity ... verified the material, nor any reference was made in the approval letter about the material supplied to him by the AO alongwith the draft assessment orders for his consideration and thus it is a mechanical approval given. He further states that the Addl. CIT was at Gurugram and the assessing

Nanak Chand Tayal, Faridabad Haryana vs. Deputy Commissioner of Income Tax Central Circle 2 Faridabad, Faridabad Haryana

The appeals of the assessee are allowed

ITA 1614/DEL/2025[2016-17]Status: DisposedITAT Delhi24 Sept 2025AY 2016-17

Bench: Shri Anubhav Sharma & Shri Krinwant Sahay

For Appellant: Dr. Rakesh Gupta, Advocate &For Respondent: Shri Mahesh Kumar, CIT-DR
Section 153ASection 153D

gone through the seized material, assessment records including the replies filed by the assessee with reference to the additions/ disallowance proposed in the drafts assessment order. Rather the Addl. CIT referred the action of the AO in making enquiries and considering all the material and providing sufficient opportunity ... verified the material, nor any reference was made in the approval letter about the material supplied to him by the AO alongwith the draft assessment orders for his consideration and thus it is a mechanical approval given. He further states that the Addl. CIT was at Gurugram and the assessing

Nanak Chand Tayal, Faridabad Haryana vs. Deputy Commissioner of Income Tax Central Circle 2 Faridabad, Faridabad Haryana

The appeals of the assessee are allowed

ITA 1613/DEL/2025[2015-16]Status: DisposedITAT Delhi24 Sept 2025AY 2015-16

Bench: Shri Anubhav Sharma & Shri Krinwant Sahay

For Appellant: Dr. Rakesh Gupta, Advocate &For Respondent: Shri Mahesh Kumar, CIT-DR
Section 153ASection 153D

gone through the seized material, assessment records including the replies filed by the assessee with reference to the additions/ disallowance proposed in the drafts assessment order. Rather the Addl. CIT referred the action of the AO in making enquiries and considering all the material and providing sufficient opportunity ... verified the material, nor any reference was made in the approval letter about the material supplied to him by the AO alongwith the draft assessment orders for his consideration and thus it is a mechanical approval given. He further states that the Addl. CIT was at Gurugram and the assessing

Nanak Chand Tayal, Faridabad Haryana vs. Dy Commissioner of Income Tax, Faridabd Haryana

The appeals of the assessee are allowed

ITA 1612/DEL/2025[2014-15]Status: DisposedITAT Delhi24 Sept 2025AY 2014-15

Bench: Shri Anubhav Sharma & Shri Krinwant Sahay

For Appellant: Dr. Rakesh Gupta, Advocate &For Respondent: Shri Mahesh Kumar, CIT-DR
Section 153ASection 153D

gone through the seized material, assessment records including the replies filed by the assessee with reference to the additions/ disallowance proposed in the drafts assessment order. Rather the Addl. CIT referred the action of the AO in making enquiries and considering all the material and providing sufficient opportunity ... verified the material, nor any reference was made in the approval letter about the material supplied to him by the AO alongwith the draft assessment orders for his consideration and thus it is a mechanical approval given. He further states that the Addl. CIT was at Gurugram and the assessing

Nanak Chand Tayal, Faridabad Haryana vs. Deputy Comissioner of Income Tax Central Circle 2 Faridabad, Faridabad Haryana

The appeals of the assessee are allowed

ITA 1611/DEL/2025[2013-14]Status: DisposedITAT Delhi24 Sept 2025AY 2013-14

Bench: Shri Anubhav Sharma & Shri Krinwant Sahay

For Appellant: Dr. Rakesh Gupta, Advocate &For Respondent: Shri Mahesh Kumar, CIT-DR
Section 153ASection 153D

gone through the seized material, assessment records including the replies filed by the assessee with reference to the additions/ disallowance proposed in the drafts assessment order. Rather the Addl. CIT referred the action of the AO in making enquiries and considering all the material and providing sufficient opportunity ... verified the material, nor any reference was made in the approval letter about the material supplied to him by the AO alongwith the draft assessment orders for his consideration and thus it is a mechanical approval given. He further states that the Addl. CIT was at Gurugram and the assessing

Jubilant Generics Ltd., Noida vs. ACIT, Circle- 5(1)(1), G.B. Nagar

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

ITA 2004/DEL/2022[2018-19]Status: DisposedITAT Delhi24 Sept 2025AY 2018-19

Bench: Shri Yogesh Kumar U.S. & Shri Avdhesh Kumar Mishra

Section 143(3)Section 144BSection 92C

Rs.54,13,35,405/- (Rs.52,66,10,000/- plus Rs.1,47,25,405/-) in his order. Based on which, the draft assessment order was passed by the Ld. Assessing Officer (‘AO’). 5. Aggrieved with the draft assessment order, the assessee filed its objections before the Ld. Dispute Resolution Panel

Innovative Textiles Limited, Delhi vs. DCIT, Circle-10(1), New Delhi

In the result, the appeal of the assessee is partly allowed

ITA 1160/DEL/2022[2017-18]Status: DisposedITAT Delhi24 Sept 2025AY 2017-18

Bench: Shri S. Rifaur Rahman & Shri Yogesh Kumar U.S.Innovative Textiles Limited, Vs. Dcit, Circle 10(1), 81, Vighyan Vihar, New Delhi. Delhi – 110 092. (Pan : Aaaci0473J) (Appellant) (Respondent) Assessee By : Shri Gautam Jain, Advocate Revenue By : Shri S.K. Jadhav, Cit Dr Date Of Hearing : 05.08.2025 Date Of Order : 24.09.2025 O R D E R Per S.Rifaur Rahman: 1. This Appeal Is Filed By The Assessee Against Assessment Order Dated 26.03.2022 Passed By The Income Tax Department/National Faceless Assessment Centre, Delhi U/S 143(3) Read With Section 144C(13)/144B Of The Income-Tax Act, 1961 (For Short ‘The Act”) For Assessment Year 2017-18 Pursuant To The Directions Of The Dispute Resolution Panel U/S 144C(5) Of The Act Raising Following Grounds Of Appeal :- “1. That The Orders Of The Learned Lower Tax Authorities Is/Are Contrary To The Law & Facts Of The Case.

For Appellant: Shri Gautam Jain, AdvocateFor Respondent: Shri S.K. Jadhav, CIT DR
Section 115JSection 143(3)Section 144BSection 144C(13)Section 144C(5)Section 234ASection 270A

framed without following the mandatory procedural provisions of section 144B of the Income - tax Act, 1961 as no show cause notice being draft assessment order was served on the appellant before making the final assessment order. 3. That the learned Hon'ble Dispute Resolution Panel (DRP) /lower tax authorities ... being in accordance with the mandatory procedural provisions of section 144B of the Income - tax Act, 1961 as no show cause notice being draft assessment order was served on the appellant before making the final assessment order; b. That the addition of Rs.84,95,443 being TP adjustment with reference

N R Farms Private Limited, Nagpur vs. The Income Tax Officer Ward - 2(2), Nagpur

In the result, Assessee’s appeal is allowed

ITA 251/NAG/2025[2014-2015]Status: DisposedITAT Nagpur23 Sept 2025AY 2014-2015

Bench: Shri Narender Kumar Choudhryn.R. Farms Private Limited, Ito, Ward-2(2), Nagpur. Flat No. 302, Swami Sadan, Vs. Gpo Square, Civil Lines, Nagpur Pan: Aaecn 4552 F (Appellant) (Respondent)

For Appellant: Shri Manoj G. Moryani, Ld. AdvcoateFor Respondent: Shri Surjit Kumar Saha, Ld. Sr.D.R
Section 115BSection 148Section 250Section 68

issuing notice u/sec. 148 of the Act, case of the Assessee was reopened and accordingly a show-cause notice along with draft assessment order was sent to the Assessee on 19/03/2022 & 22/03/2022. Against which, the Assessee by submitting reply along with loan confirmation by M/s. Purvi Finvest