CORTEVA AGRISCIENCE INDIA PVT LTD,DELHI V. DCIT,CIRCLE-4(2), DELHI

ITA 2865/DEL/2025

AI Insights

Corteva Agriscience India Pvt. Ltd appealed against the final assessment orders passed by the Assessing Officer (AO), which were based on directions from the Dispute Resolution Panel (DRP) and the Transfer Pricing Officer (TPO). The primary contention was that these orders were issued beyond the statutory time limits prescribed under the Income Tax Act, 1961. The Tribunal examined the timeline of events, including the dates of the original and final assessments, and the directions from the DRP and TPO. It was found that the final assessment orders were indeed passed beyond the permissible time limits, leading to the Tribunal's decision to quash these orders.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 840224 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Assessment Year: 2017-2018
• Appeal Filed On: 30-04-2025
• Other Referred Cases: TNS India Pvt. Ltd Vs. Union of India, Instruments & Control Co. (supra), Nokia India (P.) Ltd. (supra), DR R.P. PATEL, (supra), Virtusa Consulting Services (P.) Ltd. v. Dispute Resolution Panel (DRP)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AHAVETA DATTA; LD PCIT
• Assessee Lawyers: HARPREET SINGH AJMANI
• Keywords: Set aside; Transfer pricing; International transaction; Period of limitation
• Section: 143(3); 263

Judgement Text

"Page | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “I”: NEW DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER ITA No. 2865/Del/2025 (Assessment Year: 2017-18) Corteva Agriscience India Pvt. Ltd, 17th Floor, Tower-C, DLF Cyber Greens, Sector-25A, Phase-III, Gurgaon Vs. DCIT, Circle-4(2), New Delhi (Appellant) (Respondent) PAN: AAACE2462M Assessee by : Shri Harpreet Singh Ajmani, Adv Ms. Ashmita Sharma, Adv (virtual) Revenue by: Ms. Ahaveta Datta, Ld (PCIT) Date of Hearing 23/02/2026 Date of pronouncement 27/02/2026 O R D E R PER M. BALAGANESH, A. M.: 1. The Assessee Corteva Agriscience India Pvt. Ltd (hereinafter referred to as ‘assessee) by filing the present appeal sought to set aside the impugned order dated 31.03.2025 passed by the Assessing Officer (AO) under section 254/143(3) of the Income Tax Act, 1961 (for short ‘the Act’) inconsonance with the order passed by the Dispute Resolution Panel (DRP)-1, New Delhi dated 25.03.2025 u/s 144C(5) and order of TPO u/s 92CA(3). 2. Ground Nos. 1 and 2 raised by the assessee are general in nature and does not require any specific adjudication. 3. The assessee has raised Ground No. 3 stating that the final assessment order passed by the ld AO pursuant to the direction of the ld Printed from counselvise.com ITA No. 2865/Del/2025 Corteva Agriscience India Pvt. Ltd Page | 2 DRP is barred by limitation. This goes to the root of the matter and hence the same is taken first for adjudication. 4. We have heard the rival submissions and perused the materials available on record. In this case, the return of income was filed for AY 2017-18 on 30.11.2017. The case was selected for scrutiny. A reference was made u/s 92CA(3) of the Act by ld AO to the ld TPO to determine the Arm’s Length Price (ALP) of international transaction undertaken by the assessee. Accordingly, an order stood passed by the ld TPO u/s 92CA(3) of the Act on 29.01.2021. The draft assessment order was passed by the ld AO u/s 144C(1) of the Act on 09.04.2021. The directions were issued by the ld DRP u/s 144C(5) of the Act on 19.01.2022. Giving effect to the directions of the ld DRP, the ld TPO passed an order on 08.02.2022. Final assessment order was passed u/s 143(3) r.w.s. 144C(13) of the Act on 17.02.2022. The appeal was filed against this final assessment order before this Tribunal. This Tribunal restored the matter to the file of the ld DRP vide its order dated 28.07.2022. By this process, the second round of litigation got commenced. 5. The ld DRP vide email intimated the assessee in the second round of proceedings fixing the hearing of the assessee on 26.09.2022 vide intimation dated 19.09.2022. The evidence in this regard is enclosed in page 1265 of the paper book Volume-III. However, we find that the ld DRP finally issued directions u/s 144C(5) of the Act on 25.03.2025, which is beyond the stipulated time limit under any provision of the Income Tax Act. Pursuant to this direction of the ld DRP, ld TPO passed the appeal effect order on 28.03.2025, which is also barred by limitation. The final assessment order was passed u/s 254/143(3) of the Act 31.03.2025 by the ld AO, which is also barred by limitation as it is beyond the stipulated time limit under any provision of the Act. Strangely one more final assessment Printed from counselvise.com ITA No. 2865/Del/2025 Corteva Agriscience India Pvt. Ltd Page | 3 order was also passed for the assessee for AY 2017-18 u/s 254 r.w.s. 143(3) of the Act on 03.04.2025, determining the same income of ₹352,87,30,775/-, which is also barred by limitation. 6. The Tribunal in the first round had passed the order on 28.07.2022. Hence, the limitation prescribed in section 153(3) of the Act would start from that date. As per 1st proviso to section 153(3) of the Act, the ld AO should have passed the final assessment order itself within 12 months from the end of the financial year in which the order of the Tribunal was passed. Hence, the last date for passing final assessment order for the ld AO would expire on 31.03.2024, which means the directions of the ld DRP should have been issued prior to that date. In the instant case, the directions of the ld DRP itself were issued only on 25.03.2025, which is beyond the time limit prescribed under 1st proviso to Section 153(3) of the Act. Hence, the final assessment order becomes barred by limitation. The ld AR rightly placed reliance on the decision of the Hon’ble Telangana High Court in the case of TNS India Pvt. Ltd Vs. Union of India reported in 155 taxmann.com 537 dated 09.10.2023. The relevant portion of that order is produced as under:- “18. Now in the light of the aforesaid question that needs to be considered and answered by this Bench, it is relevant to take note of the entire contents of section 153 and the sub-sections envisaged therein. A plain reading of the entire section 153 itself would go to establish that the said section has been enacted by the framers of law so as to prescribe time limit for completion of assessment, reassessment and recomputation. First, the sub-sections (1), (1A), (1B) and 2 of the Act start with a specific restrictive command highlighting the fact that beyond a particular period of time prescribed under the various sub-sections referred to above, the Assessing Officer is denuded of his powers to pass an assessment order. The aforesaid provisions of law i.e. sub-section (1), (1A), (1B) and 2 deal with the assessment, reassessment and recomputation in exercise of powers conferred upon the Assessing Officer. 19. The aforesaid provisions did not envisage a situation where there is an order of remand by the Appellate Tribunal or an Appellate Authority. It is precisely for this reason that sub-section (2A) stood enacted in respect of a situation where there is an order of remand with a direction to the Assessing Officer to pass a Printed from counselvise.com ITA No. 2865/Del/2025 Corteva Agriscience India Pvt. Ltd Page | 4 fresh assessment order. Sub-section (2A) starts with a non-obstante clause holding that notwithstanding anything contained in the aforesaid provisions i.e. sub-section (1), (1A), (1B) and 2 in the event of an order of fresh assessment ordered by the Appellate Tribunal or the Appellate Authority after setting aside or cancelling the earlier assessment order, the authority concerned is required to make an assessment in terms of the direction of the Appellate Tribunal or the Appellate Authority as the case may be within a stipulated period. A plain reading of the aforesaid statutory provisions does not give any other interpretation other than that mentioned above. 20. The very purpose of enacting sub-section (2A) goes to show that it has been enacted to meet with a situation where the original assessment order has been set aside/cancelled by the Appellate Tribunal or the Appellate Authority under section 250 or under section 254 or under section 263 or under section 264. As regards sub-section 3 of section 153 as it stood prior to the amendment carried out in the year 2016, the reading of the said provision of law would also give a clear indication that there shall be no time limit for completion of the assessment, reassessment and recomputation towards compliance of any direction contained in an order under section 250, 254, 260, 262, 263 or section 264 subject to the provisions of sub-section (2A) and in a proceeding otherwise than by way of an appeal or reference under this Act. This in other words means that this is a provision which deals with a situation where the assessment, reassessment and recomputation is made, to give effect to a finding or a direction contained in an order under sections 250, 254, 260, 262, 263 or section 264 in an appeal or reference. 21. The aforesaid conclusion arrived at by this Bench further stands strengthened from the amendment that was brought to the Act, particularly, so far as sub- section 3 of section 153 is concerned with effect from 1-4-2016 onwards. Vide the said amendment, the legislature has brought a time limit for adjudication of a proceeding under sub-section 3 as well which till the amendment was made was not stipulated. If the analogy of the principle contention of the learned counsel for the respondent-Department is to be accepted, then in that event, the very purpose of sub-section (2A) becomes redundant. The contention of the learned counsel for the respondent-Department also would not be sustainable for the reason that if, that would had been the intention of the legislature, then at the time of the amendment brought in to sub-section 3 of section 153, the legislature would also had deleted the provision of sub-section (2A), as it would not be any further required in the light of their contention and in the light of the subsequent amendment brought in to sub-section 3 of section 153. 22. Now we shall refer to certain judicial precedents on the said subject from different High Courts. The High Court of Gujarat in the case of Instruments & Control Co. (supra) in paragraph Nos.16.3, 17, 19, 21, 22 and 25 held as under: \"16.3 We may notice that sub-section (2A) of section 153 was introduced by way of amendment by the Amendment Act, 1970 with effect from 1-4- 1971. Correspondingly, the words \"subject to the provisions of sub- section (2A)\" were also added in sub-section (3) of section 153. Printed from counselvise.com ITA No. 2865/Del/2025 Corteva Agriscience India Pvt. Ltd Page | 5 17. It can, thus, be seen that prior to introduction of sub-section (2A) of section 153, the Legislature provided for limitation for completion of assessments under sub-section (1) and sub-section (2) of section 153. Sub- section (3) of section 153, however, provided that the provisions of sub- sections (1) and (2) shall not apply to classes of assessments, reassessments and re-computations provided in clauses (i) to (iii) of sub- section (3) of section 153. Such classes included a case of fresh assessment made under section 146; a case of assessment, reassessment or re-computation in consequence of or to give effect to any finding or direction contained in an order under section 250, 254, 260, 262, 263 of 264, as also in case of a firm, where an assessment is made on a partner of the firm in consequence of an assessment made on the firm under section 147. 19. The situation, however, must bee seen to have undergone a material change upon introduction of sub-section (2A) of section 153 of the Act, which provides inter alia that notwithstanding anything contained in sub- sections (1) and (2), in relation to the assessment year commencing on the 1st day of April, 1971, and any subsequent assessment year, an order of fresh assessment under section 146 or in pursuance of an order, under section 250, section 254, section 263 or section 264, setting aside or cancelling an assessment, may be made at any time before the expiry of two years from the end of the financial year in which the order under section 146 cancelling the assessment is passed by the Assessing Officer or the order under section 250 or section 254 is received by the Chief Commissioner or Commissioner, as the case may be. As already noted, while introducing sub-section (2A) in section 153 of the Act, the Legislature simultaneously made a small change in sub-section (3) thereof by adding the words, \"subject to the provisions of sub-section (2A)\". 21. Sub-section (2A) of section 153 of the Act, therefore, in our view, would cover the cases where the Assessing Officer is required to pass a fresh order of assessment when such fresh assessment is necessitated on account of an order setting aside or cancelling the assessment. In comparison, clause (ii) of sub-section (3) of section 153 would apply where there is a need for an assessment, reassessment or re-computation in consequence of or to give effect to any finding or direction contained in an order passed under section 250 etc. Significantly, after 1-4-1971, the provisions of sub-section (3) of section 153 of the Act are made subject to the provisions of section (2A) of section 153 of the Act. 22. Under the circumstances, the class of cases of fresh assessment to be made pursuant to order under section 250 etc. would fall under section (2A) of section 153 of the Act, and the period of limitation prescribed therein would operate. In those cases where there is no need for a fresh assessment and are not covered under section (2A) of section 153 of the Act, but are covered under clauses (i), (ii) and (iii) of section 153, the limitation prescribed under sub-section (2A) of section 153 would not apply and the expression \"assessment, reassessment and re- computation be completed at any time\" may enable the revenue to continue the Printed from counselvise.com ITA No. 2865/Del/2025 Corteva Agriscience India Pvt. Ltd Page | 6 proceedings of assessment even beyond the period prescribed under sub- sections (1) and (2) of section 153 of the Act and would also not be hindered by the prescription of limitation under section (2A) of section 153 of the Act. 25. To our mind, the case on hand would fall under sub-section (2A) of section 153 of the Act. The Tribunal may not have used the words of \"setting aside the assessment\", nevertheless, when it remitted the matter back to the Assessing Officer for summoning two witnesses again for cross-examination by the assessee and permitted further probe to the Assessing Officer, necessarily it must be understood to have set aside the assessment under challenge. The Tribunal. otherwise in law, could not have remitted the proceedings to the Assessing Officer for fresh consideration after summoning two witnesses and carrying out such probe as may be necessary. We may record that such commissions paid to the two agencies was the sole dispute between the assessee and the Department. In the original assessment, the Assessing Officer discussed only this issue and made corresponding disallowance. In essence, thus, the Assessing Officer was required to pass a fresh order of assessment which was necessary on account of an order passed by the Tribunal under section 254 of the Act cancelling the assessment framed by the Assessing Officer. The period of limitation prescribed in section 153(2A), therefore, would not apply. While such an order was served on the Commissioner on 3-8-1994, within a period of two years of the end of such financial year, a fresh order of assessment had to be passed by the Assessing Officer. The same not having been done, in our view, such proceedings have become time-barred. The assessment placed before the Assessing Officer by the Tribunal's order, therefore, must be treated as having abated. In that view of the matter, the declaration prayed for by the petitioner must be granted.\" 23. The High Court of Delhi also in the case of Nokia India (P.) Ltd. (supra) dealing with the said provisions of law in paragraph Nos.22, 23, 24 and 25 held as under: \"22. Having perused the impugned order of the ITAT carefully and the operative portions qua which the assessment order was set aside and the matter remanded to the AO, the Court is unable to agree with the contention of learned ASG that the aforementioned order of the ITAT did not constitute a complete setting aside of the assessment with directions to the AO to pass a fresh order. The Court does not agree with the submission of the learned ASG that the AO was 'chained' by the ITAT's directions and could not have passed a fresh assessment order de novo pursuant to such remand. 23. The Court is also unable to agree with the contention that unless the entire assessment order is wholly set aside, the time limit for passing the fresh order under section 153 (2A) would not be attracted. There is no warrant for such an interpretation. The object behind introduction of sub- section (2A) was to prescribe a time limit for completing the assessment proceedings upon the original assessment being set aside or being Printed from counselvise.com ITA No. 2865/Del/2025 Corteva Agriscience India Pvt. Ltd Page | 7 cancelled in appeal. Clearly, the intention was not to restrict the applicability of sub-section (2A) only to such cases where the 'entire' original assessment order is set aside. It was noted that, \"Under the existing provisions of section 153 (3), such fresh assessments are not subject to any time limit.\" Indeed, section 153, as it stood at that time, did not prescribe any time limits. Section 153 (3) (ii), in particular, did not require the order passed thereunder to be issued within any particular time limit. Further there is a distinction between an 'assessment' that is set aside and an 'assessment order' being set aside. When the assessment on an issue is set aside and the matter remanded, with a direction that the issue has to be determined afresh, section 153 (2A) of the Act would get attracted. 24. What is important to note is that, along with the insertion of sub- section (2A), sub-section (3) underwent a simultaneous change. It was expressly made \"subject to the provisions of sub-section (2A).\" This meant that section 153 (3) would thereafter apply only to such cases where section 153 (2A) did not apply. In other words, in all instances of an AO having to pass a fresh assessment order upon remand where section 153 (2A) would apply, the AO would be bound to follow the time limit imposed by sub-section (2A). Where the AO as only giving effect to an appellate order, then section 153 (3) (ii) of the Act would apply. 25. In the present case, of the seven issues, the assessment in respect of five was set aside and the issues remanded for a fresh determination. Whether the remand was to the TPO or the DRP would not make a difference as long as what results from the remand is a fresh assessment of the issue. Clearly, therefore, the time limit for completing that exercise was governed by section 153 (2A) of the Act.\" 24. The High Court of Kerala also in the case of DR R.P. PATEL, (supra) in paragraph No. 12 held as under: \"12. The resultant position therefore is that, even in a case where only one issue has been directed to be considered afresh, the limitation under section 153(2A) would apply. It is clear from the passage in [(2008) 300 ITR 173 (Delhi] (supra) extracted above that, sub section (3) of section 153 applies to a different situation where only a consequential order has to be passed in implementation of a direction issued by the appellate forum. In the present case, as already found above the direction was to consider the issue afresh. Therefore, section 153(2A) of the Act is attracted. In view of the above, this is a case in which the Assessing Officer ought to have passed a consequential order within the time limit stipulated. Since no such order was passed the petitioner is entitled to succeed. In view of the above findings the writ petition is allowed. It is held that in so far as the issue that was remitted to the respondent Assessing Officer for fresh consideration, the time bar contained in section 153(2A) of the Act operates.\" Printed from counselvise.com ITA No. 2865/Del/2025 Corteva Agriscience India Pvt. Ltd Page | 8 Recently, the Madras High Court also in the case of Virtusa Consulting Services (P.) Ltd. v. Dispute Resolution Panel (DRP) [2022] 139 taxmann.com 361/446 ITR 454 dealt with similar circumstances decided on 9-6-2022. 25. In the light of above decision of Hon'ble High Court of Kerala, (supra) the contention of learned standing counsel for respondent-Department that section 153 (2A) of the Act has no application to the present case as the Tribunal had only partially remanded the matter, lacks merit and is untenable. 26. From plain reading of the judicial pronouncements and precedents in the preceding paragraphs and the findings given by this Court, we are of the considered opinion that the proceedings drawn, admittedly being beyond a period that is prescribed under sub-section (2A) of section 153 and the consequential orders passed are all beyond the period of limitation prescribed under sub- section (2A) of section 153. Hence, the same being not sustainable, deserves to be and is accordingly set aside/quashed. 27. Accordingly, the Writ Petitions are allowed. There shall be no order as to costs. As a sequel, miscellaneous petitions, pending if any, shall stand closed. “ 7. In view of the aforesaid observations and respectfully following the aforesaid judicial precedent, the Ground No. 3 raised by the assessee is hereby allowed by holding that the final assessment orders dated 31.03.2025 and 03.04.2025 are barred by limitation. Since the entire assessment is quashed as void ab initio, the other grounds raised by the assessee need not be gone into and they are left open. 8. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 27/02/2026. -Sd/- -Sd/- (CHALLA NAGENDRA PRASAD) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated : 27/02/2026 A K Keot Copy forwarded to 1. Applicant Printed from counselvise.com ITA No. 2865/Del/2025 Corteva Agriscience India Pvt. Ltd Page | 9 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi Printed from counselvise.com "