M/s Getrag Hi - Tech Gears Pvt. Ltd., Ludhiana V. ACIT, Ludhiana

CO 29/CHANDI/2012

• Counselvise Citation: [2016] 123 COUNSELVISE.COM (IT) 2073 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 year(s) 5 month(s) 27 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 11-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 01-12-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 14-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ADITYA KUMAR
• Assessee Lawyers: AJAY SHARMA
• Keywords: Depreciation; Transfer pricing; Opportunity of being heard; International transaction
• Section: 92C; 147; 131; 246; 154; 92

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.823/CHD/2012 ( ASSESSMENT YEAR : 2008-09) THE A.C.I.T., VS. M/S GETRAG HI TECH GEARS PVT. LTD., CIRCLE-I, E-685, PHASE-VIII, FOCAL POINT, LUDHIANA. LUDHIANA. PAN: AABCG 1650J AND C.O.NO.29/CHD/2012 ARISING OUT OF ITA NO. 823/CHD/2012 (ASSESSMENT YEAR : 2008-09) M/S GETRAG HI TECH GEARS PVT. LTD., VS. THE A.C.I.T., E-685, PHASE-VIII, FOCAL POINT, CIRCLE-I, LUDHIANA. LUDHIANA. PAN: AABCG 1650J (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI AJAY SHARMA, DR DEPARTMENT BY : S/SHRI ASHWANI KUMAR & ADITYA KUMAR DATE OF HEARING : 14.01.2016 DATE OF PRONOUNCEMENT : 11.03.2016 O R D E R PER RANO JAIN, A.M . : THE APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INC OME 2 TAX (APPEALS)-I, LUDHIANA DATED 3.5.2012 FOR ASSESS MENT YEAR 2008-09. THE ASSESSEE HAS FILED CROSS OBJECTI ONS AGAINST THE SAME. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURIN G TIMING GEARS UNDER 100% EOU STATUS SINCE 01.07.2000 . THE ASSESSEE FILED ITS RETURN OF INCOME FOR THE REL EVANT ASSESSMENT YEAR AS ON 25.9.2009 SHOWING INCOME OF RS.NIL. SINCE THERE WERE CERTAIN INTERNATIONAL TRAN SACTIONS INVOLVED IN THE CASE OF THE ASSESSEE AS PRESCRIBED UNDER SECTION 90CA(3) OF THE INCOME TAX ACT (IN SHORT TH E ACT), THE CASE WAS REFERRED BY THE ASSESSING OFFICER TO T HE TRANSFER PRICING OFFICER (TPO) UNDER SECTION 92 OF THE ACT. 3. BEFORE THE TRANSFER PRICING OFFICER, ASSESSEE FILED A DETAILED TRANSFER PRICING REPORT. HOWEVER T HE TPO REJECTED THE TRANSFER PRICING STUDY MAINTAINED BY T HE ASSESSEE AND REJECTING THE COMPARABLES AS ADOPTED B Y THE ASSESSEE IN THE TRANSFER PRICING STUDY, CARRYING HI S OWN TRANSFER PRICING STUDY, APPLYING VARIOUS FILTERS, A DOPTED SOME NEW COMPARABLE AND RECOMMENDED ADJUSTMENT OF A N AMOUNT OF RS.6,16,68,296/. THE ASSESSING OFFICER M ADE THE ADDITION OF THIS AMOUNT OF RS.6,16,68,296/ AS PROPOSED BY THE TRANSFER PRICING OFFICER ON ACCOUNT OF DIFFERENCE BETWEEN THE ARMS LENGTH PRICE AS COMPUT ED BY THE TRANSFER PRICING OFFICER AND THAT COMPUTED BY T HE ASSESSEE. 3 4. THE ASSESSEE TOOK THE MATTER BEFORE THE CIT (APPEALS). THE CONTENTIONS OF THE ASSESSEE BEFORE THE CIT (APPEALS) WERE MANY FOLD. ONE OF THE CONTENTIONS W AS THAT THE ASSESSING OFFICER HAS NOT COMPLIED WITH TH E PROVISIONS OF SECTION 144C OF THE ACT AS NO DRAFT O RDER WAS PROVIDED TO THE ASSESSEE BEFORE PROCEEDING TO FRAME THE ASSESSMENT ORDER AND THEREBY THE ASSESSEE HAS BEEN DEPRIVED OF THE OPPORTUNITY AND THE RIGHT OF FILING APPEAL BEFORE THE DISPUTE RESOLUTION PANEL. FURTHER ON THE MERITS OF THE CASE THE CONTENTIONS OF THE ASSESSEE WERE THAT THE TPO HAS WRONGLY REJECTED THE COMPARABLES ADOPTED BY THE ASSESSEE AND SUBSTITUTED THE SAME WI TH HIS OWN NEW COMPARABLES. ANOTHER CONTENTION RAISED WAS THAT IT HAD INCURRED LOSSES DUE TO EXTRAORDINARY CIRCUMSTANCES INCLUDING THOSE WHICH WERE BEYOND THE CONTROL OF THE ASSESSEE. IT WAS STATED THAT THE ASS ESSEE HAD INCURRED EXTRAORDINARY EXPENSES AMOUNTING TO RS.5,34,97,190/ WHICH INCLUDED PREMIUM RATE, PRODU CT RECTIFICATION CHARGES, STORES AND SPARES, POWER AND FUEL, PERSONNEL EXPENSES, DEPRECIATION, INTERNAL REJECTIO NS AND TRAVELLING EXPENSES. SINCE THESE EXPENSES WERE INC URRED DUE TO DEVELOPMENT AND PRODUCTION OF NEW PRODUCT CA LLED DCX GEARS, THESE WERE CLAIMED TO BE EXTRAORDINARY EXPENSE. THE CIT (APPEALS) WHILE ADJUDICATING THE A PPEAL OF THE ASSESSEE REJECTED THE LEGAL GROUND RAISED BY THE ASSESSEE HOLDING THAT THE PROVISIONS AS CONTAINED U NDER SECTION 144C HAVE BEEN BROUGHT INTO THE STATUTE W.E .F. 10.04.2009 BY THE FINANCE ACT 2009 AND THEREFORE WO ULD 4 NOT BE APPLICABLE RETROSPECTIVELY TO ASSESSMENT YEA R 2008 09. HOWEVER WHILE ADJUDICATING THE ISSUES OF THE A SSESSEE ON MERITS, THE CIT (APPEALS) GAVE A CATEGORICAL FIN DING THAT THE ASSESSING OFFICER HAS NOT GIVEN DUE ADJUST MENT TO CERTAIN EXTRAORDINARY ITEMS OF EXPENDITURE/LOSS EVE N THOUGH HE HAS ACCEPTED THAT THE SAME WAS DUE TO THE ASSESSEE. THESE EXPENSES WERE FOREIGN EXCHANGE FLUCTUATION, AIRFREIGHT AND INTERNAL REJECTIONS. TH E CIT (APPEALS) AFTER GIVING EFFECT OF DUE ADJUSTMENT ON THESE EXTRAORDINARY ITEMS CALCULATED THE PRICE OF THE INTERNATIONAL TRANSACTIONS ENTERED INTO BY THE ASSE SSEE AND HELD THAT THESE WERE AT ARMS LENGTH. IN THIS WAY THE CIT (APPEALS) GAVE A RELIEF TO THE ASSESSEE ON THE MERITS OF THE CASE. 5. AGGRIEVED BY THE ORDERS OF THE CIT (APPEALS), T HE DEPARTMENT HAS COME IN APPEAL BEFORE US RAISING THE FOLLOWING GROUNDS OF APPEAL : 1. THAT THE LD.CIT(A) HAS ERRED IN LAW IN DELETING ADD ITION OF RS.6,16,68,296/-MADE BY THE AO AS TRANSFER PRICING ADJUSTMENT U/S 92C A IN EXPORT OF FINISHED GOODS TO THE ASSOCIATED ENTERPRISES SEGMENTS WHICH IS BASED ON THE REPORT OF TPO DULY CONFRONTED TO ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 2. THAT THE LD.CIT(A) HAS ERRED IN LAW AND FACTS FOR N OT APPRECIATING THE DECISION ON COMPUTATION OF ARM'S L ENGTH PRICE U/S 92CA OF THE I.T. ACT, 1961. 5 3. THAT THE ORDER OF THE LD CIT(A) BE SET ASIDE AND TH AT OF A.O. BE RESTORED. 4. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY GROUND OF APPEAL BEFORE IT IS FINALLY DISPOSED OFF. 6. AS AGAINST THIS THE ASSESSEE HAS FILED A CROSS OBJECTION AND RAISED THE FOLLOWING GROUNDS : 1. THAT THE LD. CIT(A)-I, LUDHIANA GRAVELY ERRED IN NOT HOLDING THE ORDER PASSED BY THE LD. ASSESSING OFFICE R AS VOID /INVALID IN AS MUCH AS NO REFERENCE WAS ALLOWED TO BE MADE TO THE DISPUTE RESOLUTION PANEL REGARDING THE VARIATION IN THE INCOME RETURNED AND THE INCOME PROPO SED IN THE DRAFT ORDER AS PER PROVISIONS OF SECTION 144C OF THE INCOME TAX ACT, 1961. 2. THAT HE GRAVELY ERRED IN HOLDING HAT PROVISIONS OF SECTION 144C BROUGHT INTO THE STATUTE W.E.F. 01.04.2009 BY FINANCE ACT, 2009 WERE NOT APPLICABLE TO A/Y 2008- 09. 7. THE MAIN CONTENTION OF THE ASSESSEE IN ITS CROS S OBJECTION IS THAT THE ASSESSING OFFICER HAS NOT COM PLIED WITH THE PROVISIONS OF SECTION 144C, AS NO DRAFT OR DER WAS PROVIDED TO IT. SINCE THE ISSUE INVOLVED IN THE CRO SS OBJECTION IS A LEGAL ISSUE WE INTEND TO ADJUDICATE THE SAME FIRST. 8. THE LEARNED COUNSEL FOR THE ASSESSEE WHILE ARGUING BEFORE US STATED THAT BY NOT COMPLYING THE PROVISIONS OF SECTION 144C I.E. NOT PROVIDING THE D RAFT ORDER THE ASSESSING OFFICER HAS DEPRIVED OF THE ASS ESSEE OPPORTUNITY AND THE RIGHT OF FILING OBJECTIONS BEF ORE THE 6 DISPUTE RESOLUTION PANEL(DRP). OUR ATTENTION WAS IN VITED TO THE PROVISIONS OF SECTION 144C OF THE ACT, WHERE BY IT HAS BEEN PROVIDED THAT THE ASSESSING OFFICER IS OB LIGED TO FORWARD A DRAFT OF THE PROPOSED ORDER OF ASSESSMENT TO THE ASSESSEE IF HE INTENDS TO MAKE ON OR AFTER THE 1 ST DAY OF OCTOBER 2009 ANY VARIATION IN THE INCOME OR LOSS RE TURNED BY THE ASSESSEE. IT WAS ALSO BROUGHT TO OUR NOTICE THAT THE ORDER OF THE TPO IS DATED 21.10.2011, WHILE THE ORD ER OF THE ASSESSING OFFICER IN THE PRESENT CASE IS DATED 26.12.2011. IN VIEW OF THIS IT WAS CONTENDED THAT T HE ORDER PASSED BY THE ASSESSING OFFICER IS BAD IN LAW AND LIABLE TO BE QUASHED. RELIANCE WAS PLACED ON THE JUDGEMENT OF THE HIGH COURT OF MADRAS IN THE CASE O F VIJAY TELEVISION (P) LTD. VERSUS DRP (2014) 369 ITR 113. A COPY OF THE ORDER OF THE SUPREME COURT DISMISSING THE SL P FILED AGAINST THE ORDER OF THE ANDHRA PRADESH HIGH COURT IN THE CASE OF ZUARI CEMENT LIMITED VERSUS ACIT IN WP NO. 5557 OF 2012 DATED 21.02.2013 WAS ALSO FILED TO BRING ON RECORD THE FACT THAT THE JUDGEMENT OF THE ANDHRA PRADESH H IGH COURT IN THE CASE OF ZUARI CEMENT HAS BEEN AFFIRMED BY THE SUPREME COURT. IN THIS JUDGEMENT OF THE ANDHRA PRADESH HIGH COURT IT WAS HELD THAT THAT THE PASSIN G OF THE ASSESSMENT ORDER WITHOUT GIVING ASSESSEE DRAFT ASSESSMENT ORDER IS BAD IN LAW AND IS LIABLE TO BE QUASHED. 9. THE LEARNED D.R. IN REPLY RELIED ON THE ORDER O F THE CIT (APPEALS) AND STATED THAT THE PROVISIONS OF SECTION 7 144C HAVE BEEN BROUGHT INTO THE STATUTE W.E.F. 1.4. 2009 BY THE FINANCE ACT 2009 AND THEREFORE WOULD NOT BE APPLICABLE RETROSPECTIVELY TO ASSESSMENT YEAR 2008 09. SINCE THE CASE PERTAINS TO ASSESSMENT YEAR 2008-09 THESE PROVISIONS ARE NOT APPLICABLE TO IT. 10. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOTH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHO RITIES BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECO RD. THE PROVISIONS OF SECTION144C OF THE ACT READ AS UN DER: 144C. (1) THE ASSESSING OFFICER SHALL, NOTWITHSTANDING A NYTHING TO THE CONTRARY CONTAINED IN THIS ACT, IN THE FIRST INSTANCE, FORWA RD A DRAFT OF THE PROPOSED ORDER OF ASSESSMENT (HEREAFTER IN THIS SECTION REFERRED T O AS THE DRAFT ORDER) TO THE ELIGIBLE ASSESSEE IF HE PROPOSES TO MAKE, ON OR AFT ER THE 1ST DAY OF OCTOBER, 2009, ANY VARIATION IN THE INCOME OR LOSS RETURNED WHICH IS PREJUDICIAL TO THE INTEREST OF SUCH ASSESSEE. (2) ON RECEIPT OF THE DRAFT ORDER, THE ELIGIBLE ASS ESSEE SHALL, WITHIN THIRTY DAYS OF THE RECEIPT BY HIM OF THE DRAFT ORDER, (A) FILE HIS ACCEPTANCE OF THE VARIATIONS TO THE AS SESSING OFFICER; OR (B) FILE HIS OBJECTIONS, IF ANY, TO SUCH VARIATION WITH, (I) THE DISPUTE RESOLUTION PANEL; AND (II) THE ASSESSING OFFICER. (3) THE ASSESSING OFFICER SHALL COMPLETE THE ASSESS MENT ON THE BASIS OF THE DRAFT ORDER, IF (A) THE ASSESSEE INTIMATES TO THE ASSESSING OFFICER THE ACCEPTANCE OF THE VARIATION; OR (B) NO OBJECTIONS ARE RECEIVED WITHIN THE PERIOD SP ECIFIED IN SUB-SECTION (2). (4) THE ASSESSING OFFICER SHALL, NOTWITHSTANDING AN YTHING CONTAINED IN SECTION 153 [OR SECTION 153B ], PASS THE ASSESSMENT ORDER UNDER SUB-SECTION (3) WITHIN ONE MONTH FROM THE END OF THE MONTH IN WHICH, (A) THE ACCEPTANCE IS RECEIVED; OR (B) THE PERIOD OF FILING OF OBJECTIONS UNDER SUB-SE CTION (2) EXPIRES. 8 11. FROM THE PERUSAL OF THE ABOVE PROVISIONS IT IS CLEAR THAT THE POSITION OF LAW IS THAT UNDER SECTIO N 144C OF THE ACT, WITH EFFECT FROM 1.10.2009 THE ASSESSIN G OFFICER IS REQUIRED TO ISSUE A DRAFT ASSESSMENT ORD ER IN CASE THERE IS A PROPOSED ADDITION OR DISALLOWANCE O N THE RETURN FILED BY THE ASSESSEE. THIS IS A MANDATORY REQUIREMENT OF LAW. 12. THE PROVISIONS ARE QUIET UNAMBIGUOUS. THE FACT THAT THE ASSESSEE IS AN ELIGIBLE ASSESSEE IS NOT IN DISPUTE IN THE PRESENT CASE. THE MEANING OF ELIGIBLE ASSES SEE IS PROVIDED UNDER SECTION 144C(15) CLAUSE (B), WHICH R EADS AS UNDER: 144C (15) FOR THE PURPOSES OF THIS SECTION, (B) 'ELIGIBLE ASSESSEE' MEANS, (I) ANY PERSON IN WHOSE CASE THE VARIATION REFERRED TO IN SUB-SECTION (1) ARISES AS A CONSEQUENCE OF THE ORDER OF THE TRANSFER PRICING OFFICER PASSED UNDER SUB-SECTIO N (3) OF SECTION 92CA ; AND (II) ANY FOREIGN COMPANY.] 12. THERE IS NO DOUBT AS TO THE FACT THAT THE TPO HAS PROPOSED ADJUSTMENT TO BE MADE ON ACCOUNT OF DIFFERENCE IN ALP IN HIS ORDER PASSED UNDER SECTION 92AC OF THE ACT. 13. FURTHER UNDER SECTION 144C(2) OF THE ACT, SUCH ELIGIBLE ASSESSEE HAS THE OPTION EITHER TO ACCEPT T HE SAID ADDITION OR TO FILE OBJECTION BEFORE THE DRP AND SU CH OPTION HAS TO BE EXERCISED WITHIN 30 DAYS OF RECEIP T OF 9 SUCH DRAFT ASSESSMENT ORDER. THE PROCEDURE IS IF TH E ASSESSEE CHOOSES TO RAISE ITS OBJECTION BEFORE THE DRP, IT HAS TO BE DONE WITHIN 30 DAYS AND IF IT DOES NOT DO SO, THE AO HAS POWER TO PASS THE FINAL ASSESSMENT ORDER AND THEN THE STRAIGHT ROUTE OF THE FILING APPEAL BEFORE THE CIT (A) IS OPEN TO THE ASSESSEE. NOWHERE IN ANY OF THE PROVIS IONS THE ASSESSING OFFICER HAS BEEN GIVEN ANY OPTION TO PASS OR NOT TO PASS THE DRAFT ASSESSMENT ORDER. 14. FURTHER ON PERUSAL OF THE CIRCULAR NO. 5 OF 20 10, DATED 3 .06.2010, ISSUED BY CBDT BEING EXPLANATORY NOTES TO THE PROVISION OF THE FINANCE NO. 2 ACT, 2009, IT HAS BEEN VERY CLEARLY STATED THAT THE PROVISIONS ARE AP PLICABLE WITH EFFECT FROM 01.10.2009. RELEVANT EXTRACT OF TH E CIRCULAR READS AS UNDER: 45. PROVISION FOR CONSTITUTION OF ALTERNATE DISPUT E RESOLUTION MECHANISM 45.1 THE DISPUTE RESOLUTION MECHANISM PRESENTLY IN PLACE IS TIME CONSUMING AND FINALITY IN HIGH DEMAND CASES IS ATTAINED AFTER LON G DRAWN LITIGATION TILL SUPREME COURT. IN ORDER TO ADDRESS THE CONCERN OF THE MULTI -NATIONAL COMPANIES AND TO PROVIDE MECHANISM FOR SPEEDY DISPOSAL OF THEIR CASE S SO AS TO ATTAIN FINALITY, A NEW SECTION 144C IS INSERTED IN THE INCOME-TAX ACT TO F ACILITATE EXPEDITIOUS RESOLUTION OF DISPUTES. 45.2 THE SALIENT FEATURES OF THE ALTERNATE DISPUTE RESOL UTION MECHANISM ARE AS UNDER:- (1) THE ASSESSING OFFICER SHALL, FORWARD A DRAFT OF THE PROPOSED ORDER OF ASSESSMENT (HEREINAFTER REFERRED TO AS THE DRAFT OR DER) TO THE ELIGIBLE ASSESSEE IF HE PROPOSES TO MAKE ON OR AFTER THE 1ST DAY OF OCTO BER, 2009, ANY VARIATION IN THE INCOME OR LOSS RETURNED WHICH IS PREJUDICIAL TO THE INTEREST OF SUCH ASSESSEE. (2) ON RECEIPT OF THE DRAFT ORDER, THE ELIGIBLE ASSESSE E SHALL, WITHIN THIRTY DAYS OF THE RECEIPT BY HIM OF THE DRAFT ORDER,- (A) FILE HIS ACCEPTANCE OF THE VARIATIONS TO THE ASSESS ING OFFICER; OR (B) FILE HIS OBJECTIONS, IF ANY, TO SUCH VARIATION WITH - (I) THE DISPUTE RESOLUTION PANEL; AND (II) THE ASSESSING OFFICER. (3) THE ASSESSING OFFICER SHALL COMPLETE THE ASSESS MENT ON THE BASIS OF THE DRAFT ORDER, IF- 10 (A) THE ASSESSEE INTIMATES TO THE ASSESSING OFFICER THE ACCEPTANCE OF THE VARIATION; OR (B) NO OBJECTIONS ARE RECEIVED WITHIN THE PERIOD SPECIF IED IN SUB-SECTION (2). (4) THE ASSESSING OFFICER SHALL, NOTWITHSTANDING AN YTHING CONTAINED IN SECTION 153, PASS THE ASSESSMENT ORDER UNDER SUB-SECTION (3) WIT HIN ONE MONTH FROM THE END OF THE MONTH IN WHICH,- (A) THE ACCEPTANCE IS RECEIVED; OR (B) THE PERIOD OF FILING OF OBJECTIONS UNDER SUB-SECTIO N (2) EXPIRES. (5) THE DISPUTE RESOLUTION PANEL SHALL, IN A CASE WHERE ANY OBJECTION IS RECEIVED UNDER SUB-SECTION (2), ISSUE SUCH DIRECTIONS, AS IT THINKS FIT, FOR THE GUIDANCE OF THE ASSESSING OFFICER TO ENABLE HIM TO COMPLETE THE ASS ESSMENT. (6) THE DISPUTE RESOLUTION PANEL SHALL ISSUE THE DIRECT IONS REFERRED TO IN SUB SECTION (5), AFTER CONSIDERING THE,- (A) DRAFT ORDER; (B) OBJECTIONS FILED BY THE ASSESSEE; (C) EVIDENCE FURNISHED BY THE ASSESSEE; (D) REPORT, IF ANY, OF THE ASSESSING OFFICER, VALUATION OFFICER OR TRANSFER PRICING OFFICER OR ANY OTHER AUTHORITY; (E) RECORDS RELATING TO THE DRAFT ORDER; (F) EVIDENCE COLLECTED BY, OR CAUSED TO BE COLLECTED BY , IT; AND (G) RESULT OF ANY ENQUIRY MADE BY, OR CAUSED TO BE MADE BY IT. (7) THE DISPUTE RESOLUTION PANEL MAY, BEFORE ISSUIN G ANY DIRECTIONS REFERRED TO IN SUB-SECTION (5),- (A) MAKE SUCH FURTHER ENQUIRY, AS IT THINKS FIT; OR (B) CAUSE ANY FURTHER ENQUIRY TO BE MADE BY ANY INCOME TAX AUTHORITY AND REPORT THE RESULT OF THE SAME TO IT. (8)THE DISPUTE RESOLUTION PANEL MAY CONFIRM, REDUCE OR ENHANCE THE VARIATIONS PROPOSED IN THE DRAFT ORDER SO, HOWEVER, THAT IT SH ALL NOT SET ASIDE ANY PROPOSED VARIATION OR ISSUE ANY DIRECTION UNDER SUB-SECTION (5) FOR FURTHER ENQUIRY AND PASSING OF THE ASSESSMENT ORDER. (9)IF THE MEMBERS OF THE DISPUTE RESOLUTION PANEL D IFFER IN OPINION ON ANY POINT, THE POINT SHALL BE DECIDED ACCORDING TO THE OPINION OF THE MAJORITY OF THE MEMBERS. (10) EVERY DIRECTION ISSUED BY THE DISPUTE RESOLUTION PA NEL SHALL BE BINDING ON THE ASSESSING OFFICER. (11) NO DIRECTION UNDER SUB-SECTION (5) SHALL BE ISSUED UNLESS AN OPPORTUNITY OF BEING HEARD IS GIVEN TO THE ASSESSEE AND THE ASSESS ING OFFICER ON SUCH DIRECTIONS WHICH ARE PREJUDICIAL TO THEIR INTEREST. (12) NO DIRECTION UNDER SUB-SECTION (5) SHALL BE ISSUED AFTER NINE MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER IS FORWAR DED TO THE ELIGIBLE ASSESSEE. (13) UPON RECEIPT OF THE DIRECTIONS ISSUED UNDER SUB-SEC TION (5), THE ASSESSING 11 OFFICER, SHALL, IN CONFORMITY WITH THE DIRECTIONS, COMPLETE THE ASSESSMENT WITHOUT GIVING ANY FURTHER OPPORTUNITY OF BEING HEARD, WITH IN ONE MONTH FROM THE END OF THE MONTH IN WHICH THE DIRECTION IS RECEIVED NOTWIT HSTANDING ANYTHING TO THE CONTRARY CONTAINED IN SECTION 153. (14) THE BOARD MAY MAKE RULES FOR THE EFFICIENT FUNCTION ING OF THE DISPUTE RESOLUTION PANEL WITH A VIEW TO EXPEDITIOUSLY DISPO SE OF THE OBJECTIONS FILED, UNDER SUB-SECTION (2), BY THE ELIGIBLE ASSESSEE. (15) FOR THE PURPOSES OF THIS SECTION,- (A) 'DISPUTE RESOLUTION PANEL' MEANS A COLLEGIUM COMPRI SING OF THREE COMMISSIONERS OF INCOME-TAX CONSTITUTED BY THE BOAR D FOR THIS PURPOSE; (B) 'ELIGIBLE ASSESSEE' MEANS,- (I) ANY PERSON IN WHOSE CASE THE VARIATION REFERRED TO IN SUB-SECTION (1) ARISES AS A CONSEQUENCE OF THE ORDER OF THE TRANSFER PRICING OF FICER PASSED UNDER SUB-SECTION (3) OF SECTION 92CA; AND (II) ANY FOREIGN COMPANY. 45.3 FURTHER, CONSEQUENTIAL AMENDMENTS HAVE BEEN MA DE - (I) IN SUB-SECTION (1) OF SECTION 131 SO AS TO PROV IDE THAT THE 'DISPUTE RESOLUTION PANEL' SHALL HAVE THE SAME POWERS AS ARE VESTED IN A COURT UNDER THE CODE OF CIVIL PROCEDURE, 1908 (5 OF 1908); (II) IN CLAUSE (A) OF SUB-SECTION (1) OF SECTION 24 6A SO AS TO EXCLUDE THE ORDER OF ASSESSMENT PASSED UNDER SUB-SECTION (3) OF SECTION 143 OR UNDER SECTION 147 IN PURSUANCE OF THE DIRECTIONS OF THE 'DISPUTE RESOLUT ION PANEL' AS AN APPEALABLE ORDER AND IN CLAUSE (C) OF SUB-SECTION (1) OF SECTION 246 SO AS TO EXCLUDE AN ORDER PASSED UNDER SECTION 154 OF SUCH ORDER AS AN APPEALABLE OR DER; (III) IN SUB-SECTION (1) OF SECTION 253 SO AS TO IN CLUDE AN ORDER OF ASSESSMENT PASSED UNDER SUB-SECTION (3) OF SECTION 143 OR UNDE R SECTION 147 IN PURSUANCE OF THE DIRECTIONS OF THE 'DISPUTE RESOLUTION PANEL' AS AN APPEALABLE ORDER. IT WOULD BE THE CHOICE OF THE ASSESSEE WHETHER TO F ILE AN OBJECTION AGAINST THE DRAFT ASSESSMENT ORDER BEFORE THE DISPUTE RESOLUTIO N PANEL (DRP) OR TO PURSUE THE NORMAL CHANNEL OF FILING AN APPEAL AGAINST THE ASSE SSMENT ORDER BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). IN ORDER TO A PPROACH THE DRP, THE ASSESSEE MUST FILE AN OBJECTION AGAINST THE DRAFT A SSESSMENT ORDER WITHIN THE PRESCRIBED TIME LIMIT. IN CASE THE ASSESSEE DOES NO T FILE AN OBJECTION, THE ASSESSING OFFICER SHALL PASS THE ASSESSMENT ORDER. THE ASSESS EE CAN FILE AN APPEAL AGAINST SUCH ASSESSMENT ORDER BEFORE THE CIT (APPEALS). ONCE THE OPTION OF FILING AN OBJECTION AGAINST THE DRAFT ASSESSMENT ORDER BEFORE THE DRP H AS BEEN EXERCISED, THE ASSESSEE CANNOT WITHDRAW THE OBJECTION AND OPT FOR THE NORMA L CHANNEL OF FILING APPEAL BEFORE CIT(APPEALS). 45.5 APPLICABILITY - THESE AMENDMENTS HAVE BEEN MAD E APPLICABLE WITH EFFECT FROM 1ST OCTOBER, 2009, AND WILL ACCORDINGLY APPLY IN RE LATION TO ASSESSMENT YEAR 2010- 11 AND SUBSEQUENT ASSESSMENT YEARS. THE DISPUTE RES OLUTION PANEL RULES HAVE BEEN NOTIFIED BY S.O. NO. 2958(E) DATED 20TH NOVEMBER, 2 009. 12 15. IT IS ALSO AN UNDISPUTED FACT THAT THE ORDER O F THE AO IN THE PRESENT CASE IS DATED 26.12.2011, THE ORDER OF THE TPO IS DATED 21.10.2011. 16. IN VIEW OF THE ABOVE, THE ORDER PASSED BY THE ASSESSING OFFICER IS WITHOUT JURISDICTION. RELIANCE PLACED BY THE LD. COUNSEL OF THE ASSESSEE ON THE JUDGEMENT OF HIGH COURT OF MADRAS IN THE CASE OF VIJAY TELEVISIO N PRIVATE LIMITED VERSUS DRP (2014) 369 ITR 113 (MAD) IS NOT OUT OF PLACE. IN THE SAID CASE, IT WAS HELD THA T THE FINAL ORDER PASSED BY THE ASSESSING OFFICER WITHOUT PASSING A DRAFT ASSESSMENT ORDER IS BAD IN LAW. IN THIS CASE, RELIANCE WAS PLACED ON THE JUDGEMENT OF ANDHR A PRADESH HIGH COURT IN THE CASE OF ZUARI CEMENT LIMI TED VERSUS CIT, IN WP NO. 5557 OF 2012 DATED 21.02.2013 . IT HAS ALSO BEEN STATED THAT THE SAID JUDGEMENT OF THE AP HIGH COURT HAS GOT AFFIRMED BY THE SUPREME COURT BY DISMISSING THE SLP FILED THEREON AS ON 27. 09.2013, A COPY OF WHICH WAS ALSO FILED BEFORE US BY THE COUNSEL OF THE ASSESSEE. 17. IN VIEW OF THE ABOVE THE ORDER PASSED BY THE A O IS SET ASIDE AND THE CROSS OBJECTION OF THE ASSESSE E IS ALLOWED. 18. SINCE THE ORDER OF THE ASSESSING OFFICER IS SE T ASIDE BY US WHILE ADJUDICATING THE CROSS OBJECTION OF THE 13 ASSESSEE, WE DO NOT FIND ANY NEED TO ADJUDICATE THE ISSUES ON MERITS AS RAISED BY THE DEPARTMENT. 19. IN THE RESULT APPEAL OF THE REVENUE IS DISMISS ED AND THE CROSS OBJECTION FILED BY THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 11 TH DAY OF MARCH, 2016. SD/- SD/- (BHAVENESH SIANI) (RANO JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 11 TH MARCH, 2016 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/THE CIT/THE D R. ASSISTANT REGISTRAR, ITAT, CHANDIGARH