The case you have provided is a judgment from the High Court of Bombay at Goa, regarding Tax Appeal No.

The case you have provided is a judgment from the High Court of Bombay at Goa, regarding Tax Appeal No. 144 of 2017. The case involves the Principal Commissioner of Income Tax, Panaji Goa, as the appellant, and M/s Andrew Telecommunications P. Ltd., Verna Salcete Goa, as the respondent. The judgment was delivered on 16th July 2018 by N.M. Jamdar and Prithviraj K. Chavan, JJ.

The appeal was filed by the Revenue against the order passed by the Income Tax Appellate Tribunal, Panaji, on 21st January 2016. The Tribunal had dismissed the appeal filed by the Revenue and confirmed the order passed by the Commissioner of Income Tax (Appeals) dated 13th March 2015. The Assessee had filed a cross objection which the Tribunal allowed.

The main issue in this appeal was whether the order passed by the Tribunal was incorrect in view of the provisions of Section 144C(13) of the Income Tax Act, and whether there was a need for a draft assessment order in the said sub-section.

The High Court provided a detailed overview of Section 144C of the Income Tax Act, which lays down a scheme for reference to the Dispute Resolution Panel. The section outlines the procedure for the Assessing Officer to forward a draft of the proposed order of assessment to the eligible Assessee, who can then accept the variations or file objections to the Dispute Resolution Panel. The Panel issues necessary directions for the guidance of the Assessing Officer, and its directions are binding on the Assessing Officer.

The case at hand involved the Assessee, which was in the business of manufacturing and assembly of telecommunication cables, wave-guides, connector antennas, and accessories, as well as trading in related products. The Assessee had filed its return of income on 29th November 2006, declaring a loss of Rs. 14,93,68,912/-. The Assessment Order was passed under Section 143(3) on 16th December 2009, based on the order passed by the Transfer Pricing Officer under Section 92CA(3) dated 30th October 2009.

The Assessee had filed an objection before the Dispute Resolution Panel on 28th January 2010, and the Panel directed the Assessing Officer to modify the order passed on Arms Length Price by the Transfer Pricing Officer. Subsequently, the Assessing Officer passed an order on 24th November 2010, giving effect to the revised transfer pricing adjustment.

The Assessee filed an appeal before the Income Tax Appellate Tribunal against the order passed by the Assessing Officer, and the Tribunal set aside the Assessment Order dated 24th November 2010. The matter was then sent back to the Transfer Pricing Officer, who gave a hearing to the Assessee and passed a fresh order on 30th January 2014. Thereafter, the Assessing Officer, without issuing any draft assessment order, proceeded to pass an order on 2nd February 2015.

The Assessee challenged the said order before the Commissioner of Income Tax (Appeals), and the appeal was partly allowed by the Commissioner of Income Tax (Appeals) by order dated 13th March 2015. As against this order, the Revenue filed the Income Tax Appeal No. 271/2015 before the Income Tax Appellate Tribunal, and the Assessee filed a Cross Objection No. 62/2015.

Before the Tribunal, the Assessee filed an additional ground on 4th September 2015, contending that the Assessing Officer had erred in passing the assessment order on 12th March 2014 without forwarding a draft of the proposed order of assessment to the Assessee, thereby not following the procedure laid down in Sec. 144C of the Income Tax Act, 1961. The Tribunal entertained the additional ground and disposed of the appeal with the observation that the assessment order passed was liable to be annulled, following the decision of the Hon’ble Andhra Pradesh High Court in the case of M/s. Zuari Cement Ltd., wherein it was held that where the assessment order has been passed contrary to the mandatory provisions of sec. 144C of the Act and violation thereof, the assessment order is liable to be declared as one without jurisdiction, null and void, and unenforceable.

The High Court, after considering the arguments presented by both parties, held that the order passed by the Assessing Officer without issuing a draft assessment order was illegal and without jurisdiction. The Court also emphasized that the issuance of a draft assessment order is not an empty formality and that it provides the Assessee with the right to raise objections before the Dispute Resolution Panel.

The High Court further stated that after the matter was sent back to be decided afresh, it went back to the stage of Section 144C(1) of the Act, and since the first exercise was void and without jurisdiction, nothing remained on the record, including the draft assessment order. Therefore, the issuance of a draft assessment order was necessary.

In conclusion, the High Court dismissed the appeal, stating that no substantial question of law arises in the present appeal.

This judgment provides a detailed analysis of the provisions of Section 144C of the Income Tax Act and the importance of issuing a draft assessment order in accordance with the procedure laid down in the Act.

FAQ:

Q1: What was the main issue in the appeal?

A1: The main issue in the appeal was whether the order passed by the Tribunal was incorrect in view of the provisions of Section 144C(13) of the Income Tax Act, and whether there was a need for a draft assessment order in the said sub-section.

Q2: What was the decision of the High Court?

A2: The High Court declared the assessment order passed without issuing a draft assessment order as illegal and without jurisdiction, emphasizing the mandatory nature of the draft assessment order under Section 144C of the Income Tax Act.

Q3: What was the significance of the judgment?

A3: The judgment reaffirms the importance of following the procedural requirements laid down in the Income Tax Act, particularly regarding the issuance of a draft assessment order, to ensure the legality and jurisdiction of assessment orders.