Louis Dreyfus Commodities India Pvt. Ltd., Gurgaon V. DCIT, New Delhi

ITA 2381/DEL/2014

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 2329 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I1
• Next Hearing Date: 18-07-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 17-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Keywords: Value adopted by valuation officer; Transfer pricing; Opportunity of being heard; International transaction; Period of limitation; Fair market value; Procedural lapse; Set aside
• Section: 244A; 144C; 113; 13; 153; 92CA; 154; 2; 15; 92

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH I-1 : NEW DELHI) BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER (THROUGH VIDEO CONFERENCE) ITA NO.2381/DEL./2014 (ASSESSMENT YEAR : 2009-10) M/S. LOUIS DREYFUS COMMODITIES INDIA VS. DCIT, CIRC LE 4 (1), PRIVATE LTD., NEW DELHI. RNM CENTRE, 68/2, JANPATH, NEW DELHI 110 001. (PAN : AAACL7361E) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RAVI SHARMA, ADVOCATE SHRI ANUBHAV RASTOGI, ADVOCATE REVENUE BY : SHRI SURENDER PAL, CIT DR DATE OF HEARING : 15.02.2021 DATE OF ORDER : 11.03.2021 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : APPELLANT, M/S. M/S. LOUIS DREYFUS COMMODITIES IND IA PVT. LTD. (HEREINAFTER REFERRED TO AS THE TAXPAYER) BY FILING THE PRESENT APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 24.02.2014 PASSED BY THE ASSESSING OFFICER (AO) IN CONSONANCE WITH THE ORDERS PASSED BY THE LD. DRP/TPO UNDER SECTION 143 (3) READ WITH ITA NO.2381/DEL./2014 2 SECTION 144C OF THE INCOME-TAX ACT, 1961 (FOR SHORT THE ACT) QUA THE ASSESSMENT YEAR 2009-10 ON THE GROUNDS INTER A LIA THAT :- THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, A ND IN LAW; 1. THE ASSESSMENT ORDER PASSED IN PURSUANCE OF THE' DIRECTIONS ISSUED BY THE HON'BLE DISPUTE RESOLUTION PANEL ('HO N'BLE DRP') IS A VITIATED ORDER AS THE HON'BLE DRP ERRED BOTH ON FAC TS AND IN LAW IN PARTIALLY CONFIRMING THE ADDITION MADE BY THE LD. A SSESSING OFFICER ('LD. AO') TO THE APPELLANT'S INCOME BY ISSUING AN ORDER WITHOUT APPRECIATION OF FACTS AND LAW; 2. THE HON'BLE DRP ERRED IN PARTIALLY CONFIRMING TH E ADDITION OF THE INCOME OF THE APPELLANT BY HOLDING THAT THE INTERNATIONAL TRANSACTIONS OF THE APPELLANT PERTAINING TO THE PRO VISION OF TRADE FACILITATION SERVICE TRANSACTION, RECEIPT OF INTERE ST ON DEFERRED PAYMENT TRANSACTION AND PROVISION OF BUSINESS SUPPO RT SERVICES DO NOT SATISFY THE ARM'S LENGTH PRINCIPLE ENVISAGED UN DER THE ACT. IN DOING SO, THE HON'BLE DRP HAS GROSSLY ERRED IN AGRE EING WITH THE LEARNED TRANSFER PRICING OFFICER'S ('LD. TPO'S) ACT ION OF: COMMON TRANSFER PRICING OBJECTIONS - ALL SEGMENTS 2.1. NOT APPRECIATING THAT THE APPELLANT HAD PREPA RED THE DETAILED CONTEMPORANEOUS TRANSFER PRICING DOCUMENTA TION BONA FIDE AND IN COMPLIANCE WITH THE ACT AND INCOME TAX RULES 1962 ('THE RULES'); 2.2. DISREGARDING JUDICIAL PRONOUNCEMENTS IN INDIA IN UNDERTAKING THE TRANSFER PRICING ADJUSTMENT; TRANSFER PRICING OBJECTIONS - PROVISION OF TRADE FA CILITATION SERVICE CHARACTERISED AS TRADING ACTIVITY 2.3 FAILING TO APPRECIATE THE PECULIAR CIRCUMSTANCE S UNDER WHICH THE TRANSACTION OF PROVISION OF TRADE FACILITATION SERVICE WAS UNDERTAKEN BY THE APPELLANT WITH ITS ASSOCIATED ENT ERPRISE (AE), AND CLASSIFYING THE SUBJECT INTERNATIONAL TRANSACTI ON AS A 'TRADING' TRANSACTION WITHOUT UNDERSTANDING ITS EXACT NATURE AND WITHOUT TAKING INTO COGNIZANCE THE FUNCTIONS PERFORMED, ASS ETS EMPLOYED AND RISKS ASSUMED BY THE APPELLANT IN THIS REGARD; 2.4. ARRIVING AT THE INCORRECT CONCLUSION THAT THE CREDIT RISK IN RESPECT OF THE SUBJECT TRANSACTION WAS BORNE BY THE APPELLANT, AND FAILING TO APPRECIATE THE FACT THAT THE APPELLANT H AD RECEIVED THE ENTIRE OUTSTANDING AMOUNT (INCLUDING INTEREST) FROM THE AE IN RELATION TO THE SUBJECT TRANSACTION. TRANSFER PRICING OBJECTIONS - INTEREST ACCRUED ON D EFERRED PAYMENTS 2.5. COMPLETELY DISREGARDING THE DETAILED AND PROP ER COMPARABILITY ANALYSIS SUBMITTED BY THE APPELLANT T O BENCHMARK THE SUBJECT INTERNATIONAL TRANSACTION AND UPHOLDING THE LD. TPO'S ITA NO.2381/DEL./2014 3 ACTION IN USING THE LENDING RATES TO BENCHMARK THE SAME BASED ON THE RISKS ASSUMED BY THE APPELLANT; 2.6. WITHOUT PREJUDICE TO THE ABOVE CONTENTIONS OF THE APPELLANT, DETERMINING CREDIT RATING IN RELATION TO THE SUBJEC T INTERNATIONAL TRANSACTION ON THE BASIS OF INCORRECT ASSUMPTION OF THE FACILITY PROVIDED BY THE APPELLANT BEING 'UNSECURED' IN NATU RE. TRANSFER PRICING OBJECTIONS - BUSINESS SUPPORT SERV ICES SEGMENT 2.7. REJECTING, WITHOUT ANY COGENT REASON, THE QUA NTITATIVE AND QUALITATIVE SCREENS/ FILTERS APPLIED AND SET OF COM PARABLES ARRIVED AT BY THE APPELLANT FOLLOWING A DETAILED AND ROBUST SE ARCH METHODOLOGY CARRIED OUT IN THE TP REPORT, AND PROCEEDING TO ARR IVE AT FRESH COMPARABLE SET WITHOUT PROVIDING ANY SEARCH METHODO LOGY IN RESPECT OF BUSINESS SUPPORT SERVICES SEGMENT; 2.8. SELECTING CERTAIN COMPANIES WHICH ARE NOT COM PARABLE TO THE APPELLANT IN TERMS OF FUNCTIONS PERFORMED, ASSETS E MPLOYED AND RISKS ASSUMED, WHILE APPLYING TRANSACTIONAL NET MAR GIN METHOD ('TNMM') FOR BENCHMARKING SUBJECT INTERNATIONAL TRA NSACTION; 2.9. WHILE APPLYING TNMM FOR BENCHMARKING BUSINESS SUPPORT SERVICES, SELECTING CERTAIN COMPANIES. WHICH ARE RI OT COMPARABLE TO THE APPELLANT IN TERMS OF FUNCTIONS PERFORMED, ASSE TS EMPLOYED AND RISKS ASSUMED; 2.10. INCLUDING SUPERNORMAL PROFIT MAKING COMPANIES IN THE FINAL COMPARABLES' SET FOR BENCHMARKING A LOW RISK BEARIN G SUBJECT INTERNATIONAL TRANSACTION; 2.11. DISREGARDING PRIOR YEARS' DATA AS USED BY TH E APPELLANT IN THE TP DOCUMENTATION AND HOLDING THAT CURRENT YEAR (I.E. FY 2008- 09) DATA FOR COMPARABLE COMPANIES SHOULD BE USED DE SPITE THE FACT THAT THE SAME WAS NOT NECESSARILY AVAILABLE TO THE APPELLANT AT THE TIME OF PREPARING ITS TP DOCUMENTATION, AND IN DOIN G SO HAS GROSSLY ERRED IN INTERPRETING THE REQUIREMENT OF 'CONTEMPOR ANEOUS' DATA IN THE RULES TO NECESSARILY IMPLY CURRENT YEAR (I.E. F Y 2008-09) DATA. 3. THE LD. AO HAS GROSSLY ERRED BY PROPOSING TO COM PUTE INTEREST UNDER SECTION 234B, 234D AND 244A OF THE A CT. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. AO HAS GROSSLY ERRED IN INITIATING PENALTY PROC EEDINGS UNDER SECTION 271 (1) (C) OF THE ACT. 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICAT ION OF THE CONTROVERSY AT HAND ARE : LOUIS DREYFUS COMMODITIES INDIA PRIVATE LIMITED (LD INDIA), THE TAXPAYER, A SUBSIDIARY OF L OUIS DREYFUS COMMODITIES ASIA PTE LTD., SINGAPORE (LD ASIA) IS A N INDIA BASED ITA NO.2381/DEL./2014 4 TRADER OF AGRI-BASED COMMODITY PRODUCTS, SUCH AS, C RUDE PALM OIL, COFFEE, COTTON, SOYABEAN MEAL, SORGHUM AND MAIZE. THE TAXPAYER TRADES COMMODITIES WITH ASSOCIATED ENTERPR ISES (AES) AND THIRD PARTIES IN THE DOMESTIC AND INTERNATIONAL MARKETS. DURING THE YEAR UNDER CONSIDERATION, LD INDIA, THE TAXPAYE R WAS ALSO INTO PROVIDING BUSINESS SUPPORT SERVICES TO LD COMMODITI ES ASIA PVT. LTD. DURING THE YEAR UNDER ASSESSMENT, THE TAXPAYE R ENTERED INTO INTERNATIONAL TRANSACTIONS WITH ITS AES AS UNDER :- S.NO. NATURE OF INTERNATIONAL TRANSACTIONS VALUE OF TRANSACTION (RS.) 1 IMPORT OF AGRICULTURAL COMMODITIES 20,75,47,963 2 EXPORT OF AGRI-COMMODITIES 182,32,67,992 3 WASHOUT INCOME 23,11,27,360 4 PROVISION OF MARKET RESEARCH AND RESEARCH FOR FREIGHT AND METAL 2,98,66,151 5 PROVISIONAL OF BACK-OFFICE SUPPORT SERVICES 5,52,68,298 6 DISTRIBUTION OF CRUDE PALM OIL 109,46,30,547 6.1 RECEIPT OF COMMISSION INCOME 1,088,975 6.2 PURCHASE OF CRUDE PALM OIL FOR DISTRIBUTION 542,094,743 6.3 DISTRIBUTION OF CRUDE PALM OIL 551,446,829 7 INTEREST ACCRUED ON DEFERRED PAYMENT 89,39,853 8 REIMBURSEMENT OF EXPENSES 59,75,708 9 RECOVERY OF EXPENSES 43,60,387 10 INTEREST EXPENSES ON FOREIGN COMMERCIAL LOANS 3,96,75,852 11 PRE-PAYMENT DISCOUNT 8,04,286 3. LD. TRANSFER PRICING OFFICER (TPO) ACCEPTED AFOR ESAID INTERNATIONAL TRANSACTIONS AT ARMS LENGTH EXCEPT T RANSACTIONS AS TO PROVISION OF BACK OFFICE SUPPORT SERVICES, DISTRIBU TION OF CRUDE PALM OIL AND INTEREST ACCRUED ON DEFERRED PAYMENT M ENTIONED AT SL.NOS.5, 6 & 7. ITA NO.2381/DEL./2014 5 4. THE TAXPAYER IN ORDER TO BENCHMARK ITS TRANSACTI ONS QUA BUSINESS SUPPORT SERVICES PROVIDED TO AES USED TR ANSACTIONAL NET MARGIN METHOD (TNMM) AS THE MOST APPROPRIATE (M AM) COMPUTED ITS OWN MARGIN AT 10%, SELECTED 12 COMPARA BLES HAVING MARGIN OF 8.92% AND FOUND ITS INTERNATIONAL TRANSAC TIONS AT ARMS LENGTH. LD. TPO, ON THE OTHER HAND, BY USING VARIO US FILTERS AND ADOPTING CURRENT YEAR DATA INTRODUCED 8 NEW COMPARA BLES WITH MARGIN OF 26.25% AND THEREBY MADE AN ADJUSTMENT OF RS.81,64,635/-. 5. THE TAXPAYER ALSO FOUND ITS TRANSACTION QUA INTE REST ON DEFERRED PAYMENT AT ARMS LENGTH BY APPLYING COMPAR ABLE UNCONTROLLED PRICE (CUP) METHOD ON THE GROUND THAT SINCE THE DEPOSIT RATE BETWEEN 30 DAYS AND ONE YEAR WAS 3.25% TO 8%, THEY WERE GETTING 9% INTEREST. HOWEVER, ON THE OTHER HA ND, LD. TPO FOUND THIS TRANSACTION HAVING BEEN PERFORMED IN COM MERCIAL SET UP AND BY TREATING THE CREDIT RATING OF AES TO BE IN CATEGORY BB AND BY USING THE DATA PROCURED FROM CRISIL, PROCEEDED T O BENCHMARK THIS TRANSACTION WITH THE RETURN EARNED BY INVESTIN G IN THE BONDS OF INDIAN COMPANIES HAVING BB CREDIT RATING AND DETERM INED THE INTEREST RATE OF 17.24% TO BE AT ARMS LENGTH AND T HEREBY MADE AN ADJUSTMENT OF RS.89,13,463/-. ITA NO.2381/DEL./2014 6 6. THE TAXPAYER DURING THE YEAR UNDER ASSESSMENT AL SO PROVIDED TRADE FACILITATION SERVICES TO ITS AES QUA WHICH CR UDE PALM OIL WAS PURCHASED FROM AES AND SOLD TO JMD OIL P. LTD., AN UNRELATED ENTITY, ON COST TO COST BASIS AND ONLY AFTER GETTIN G COMMISSION OF US$ 2 PER METRIC TON (MT) FROM AES. THE TAXPAYER I N ORDER TO BENCHMARK THIS TRANSACTION USED CUP AS IN THE COMMO DITY MARKET, FACILITATION CHARGES ARE TO THE TUNE OF US$ 1 PER M T WHICH WAS LESS THAN THE COMMISSION CHARGED FROM THE AE AND THUS FO UND THIS TRANSACTION AT ARMS LENGTH. HOWEVER, LD. TPO AFTE R ANALYZING ALL FUNCTIONS, RISK AND ASSETS UTILIZED PROCEEDED TO CO NCLUDE THAT THE TRANSACTION FOR PURCHASE OF CRUDE PALM OIL FROM AES AND SALE TO THE ENTITY WAS A PURE TRADING ACTIVITY BUT CAMOUFLAGE D AS DISTRIBUTION SERVICES AND THEREBY BENCHMARKED WIT H THE PURCHASE PRICE PREVAILING ON THE DATE OF IMPORT IN THE OPEN MARKET AND THEREBY MADE AN ADJUSTMENT OF RS.19,43,65,246/-. A CCORDINGLY, LD. TPO PROPOSED THE TP ADJUSTMENT AS UNDER :- TOTAL LOSS AS PER RETURN OF INCOME FILED (14,91,03, 171) ADD : (AS DISCUSSED ABOVE (I) ADDITION ON ACCOUNT OF TRANSFER PRICING ADJUSTMENT (II) ADDITION ON ACCOUNT OF AIR INFORMATION 21,14,43,344 15,55,197 21,29,98,541 TOTAL INCOME 6,38,95,370 ROUNDED OFF 6,38,95,370 AND THEREBY SETS THE INCOME OF THE TAXPAYER AT RS.6 ,38,95,370/-. ITA NO.2381/DEL./2014 7 7. THE TAXPAYER CARRIED THE MATTER BEFORE THE LD. D RP BY WAY OF FILING THE OBJECTIONS WHICH HAVE BEEN DISPOSED O FF. FEELING AGGRIEVED, THE TAXPAYER HAS COME UP BEFORE THE TRIB UNAL BY WAY OF FILING THE PRESENT APPEAL. 8. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 9. THE TAXPAYER HAS COME UP BY MOVING AN APPLICATIO N FOR RAISING ADDITIONAL GROUND OF APPEAL AS UNDER :- GROUND NO.5 WITHOUT PREJUDICE TO THE ORIGINAL GROUNDS OF APPEAL , THE LD. TRANSFER PRICING OFFICER (TPO) HAS ERRED BY PASSING AN ORDER U/S 92CA (3) WHICH WAS BARRED BY LIMITATION, THEREB Y RENDERING THE RESULTANT FINAL ASSESSMENT ORDER NULL AND VOID AS PER THE PROVISIONS U/S 153 OF THE ACT. ON THE GROUNDS INTER ALIA THAT THE DRAFT ASSESSMENT ORDER PASSED BY THE LD. AO IS WITHOUT JURISDICTION HAVING BEEN PASS ED BEYOND THE PRESCRIBED TIME LIMIT AND AS SUCH, CONSEQUENT ASSES SMENT ORDER IS LIABLE TO BE ANNULLED; THAT ADDITIONAL GROUND CAN B E RAISED AT ANY STAGE OF PROCEEDINGS AND RELIED UPON THE JUDGMENTS PASSED BY HONBLE APEX COURT IN CASE OF JUTE CORPORATION OF I NDIA LTD. VS. CIT 187 ITR 688 AND NATIONAL THERMAL POWER CORP ORATION LTD. 229 ITR 383 . ITA NO.2381/DEL./2014 8 10. HOWEVER, ON THE OTHER HAND, LD. DR FOR THE REVE NUE OPPOSED THE APPLICATION FOR ADDITIONAL GROUND ON THE GROUND S INTER ALIA THAT APPLICATION IS NOT MAINTAINABLE HAVING BEEN FILED A FTER UNDUE DELAY; THAT NO SUCH PLEA HAS BEEN TAKEN BY THE TAXPAYER BE FORE THE LOWER REVENUE AUTHORITIES; AND THAT NO PREJUDICE HAS BEEN CAUSED TO THE TAXPAYER AS HE HAS BEEN DULY REPRESENTED BEFORE THE LD. REVENUE AUTHORITIES IN PASSING THE TP ORDER/ASSESSMENT ORDE R. 11. KEEPING IN VIEW THE SETTLED PRINCIPLE OF LAW TH AT JURISDICTIONAL ISSUE IS A LEGAL ISSUE WHICH CAN BE TAKEN BY THE AGGRIEVED PARTY AT ANY STAGE OF THE PROCEEDINGS BEF ORE THE JUDICIAL/QUASI JUDICIAL BODIES, PARTICULARLY WHEN A SSESSEE HAS COME UP WITH THE PLEADING THAT TP ORDER AND CONSEQUENT A SSESSMENT ORDER HAS BEEN PASSED BEYOND THE PERIOD OF LIMITATI ON. SO, APPLICATION RAISING ADDITIONAL GROUND BY THE TAXPAY ER IS ALLOWED WITHOUT PREJUDICE TO THE MERITS OF THIS CASE. 12. SINCE TAXPAYER HAS RAISED JURISDICTIONAL ISSUE WHICH GOES TO THE ROOTS OF THE CASE, WE WOULD DECIDE THE ADDITION AL GROUND NO.5 FIRST BEFORE GOING INTO THE GROUNDS RAISED ON MERIT S. 13. LD. AR FOR THE TAXPAYER CHALLENGING THE IMPUGNE D ORDER PASSED BY THE AO/DRP/TPO CONTENDED INTER ALIA THAT THE ORDER PASSED BY THE LD. TPO DATED 31.01.2013 WAS BARRED B Y LIMITATION AND AS SUCH, CONSEQUENT ASSESSMENT ORDER IS ALSO NO T SUSTAINABLE; ITA NO.2381/DEL./2014 9 THAT THE LAST DATE TO PASS THE TRANSFER PRICING ORD ER BY THE LD. TPO WAS 29.01.2013 AND NOT 30.01.2013 AS CONTENDED BY T HE REVENUE; THAT THE ORDER PASSED BY THE LD. TPO IS BARRED BY L IMITATION AS THE PERIOD OF 60 DAYS IS TO BE COMPUTED IN ACCORDANCE W ITH THE PROVISIONS CONTAINED U/S 153 OF THE ACT BY EXCLUDIN G THE LAST DATE AND RELIED UPON THE DECISION RENDERED BY THE HONBLE MADRAS HIGH COURT IN CASE OF M/S. PFIZER HEALTHCARE INDIA PVT. LTD. VS. JCIT WP NO.32699/2019 JUDGMENT DATED 07.09.2020 . 14. HOWEVER, ON THE OTHER HAND, LD. DR FOR THE REVE NUE TO REPEL THE ARGUMENTS ADDRESSED BY THE LD. AR FOR THE TAXPA YER CONTENDED INTER ALIA THAT THE TPO HAS PASSED ORDER IN THIS CA SE WELL WITHIN TIME I.E. ON 30.01.2013 BUT DUE TO CLERICAL ERROR D ATE OF ORDER HAS BEEN RECORDED AS 31.01.2013 AND RELIED UPON COPY OF INTERNAL NOTING, COPY OF DOCUMENTS SEEKING APPROVAL FROM DIT AND COPY OF RELEVANT DISPATCH REGISTER; AND THE DECISIONS RELIE D UPON BY THE LD. AR FOR THE TAXPAYER ARE NOT APPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THE CASE. 15. IN ORDER TO DETERMINE IF THE ORDER DATED 31.01. 2013 PASSED BY THE LD. TPO IS BARRED BY LIMITATION AS CONTENDED BY THE LD. AR FOR THE TAXPAYER, WE WOULD ADVERT TO THE PROVISIONS CON TAINED UNDER SECTION 92CA (3) READ WITH SECTION 153 OF THE ACT. ITA NO.2381/DEL./2014 10 16. UNDISPUTEDLY, SUB-SECTION (3A) TO SECTION 92CA HAS BEEN INSERTED W.E.F. 01.06.2007 PROVIDING TIME LIMIT FOR THE TRANSFER PRICING OFFICER TO PASS THE ORDER I.E. WITHIN A PER IOD OF 60 DAYS PRIOR TO THE DATE OF COMPLETION OF ASSESSMENT AS PE R SECTION 153. SO, U/S 92CA (3A) READ WITH SECTION 153, TPO WAS RE QUIRED TO PASS THE ORDER WITHIN THE PERIOD OF 60 DAYS PRIOR T O THE DATE ON WHICH THE PERIOD OF LIMITATION REFERRED TO IN SECTI ON 153 EXPIRES I.E. 21 MONTHS. 17. IN THE INSTANT CASE, UNDISPUTEDLY ASSESSMENT OR DER WAS PASSED ON 31.03.2013 AND THE TPO WAS REQUIRED TO PA SS THE ORDER WITHIN 60 DAYS PRIOR TO THE DATE ON WHICH PERIOD OF LIMITATION REFERRED TO IN SECTION 153 EXPIRES. 18. NOW, THE QUESTION ARISES AS TO HOW THE PERIOD O F 60 DAYS PRIOR TO THE DATE OF TP ORDER I.E. 31.03.2013 IS TO BE COMPUTED. 19. HONBLE MADRAS HIGH COURT IN CASE OF M/S. PFIZER HEALTHCARE INDIA PVT. LTD. (SUPRA) WHILE DEALING WITH THE ISSUE HELD THAT FOR COMPUTING THE PERIOD OF 60 DAYS, THE LAST DATE AS PER SECTION 153 SHOULD BE EXCLUDED. OPERATIVE PART OF THE JUDGMENT IS EXTRACTED FOR READY PERUSAL AS UNDER :- 30. NOW, COMING TO THE QUESTION OF HOW THE 60 DA Y PERIOD IS TO BE COMPUTED, THE CRITICAL QUESTION WOULD BE WHETHER TH E PERIOD OF 60 DAYS WOULD BE COMPUTED INCLUDING THE 31ST OF DECEMBER OR EXCLUDING IT. SECTION 153 STATES THAT NO ORDER OF ASSESSMENT SHAL L BE MADE AT ANY ITA NO.2381/DEL./2014 11 TIME AFTER THE EXPIRY OF 21 MONTHS FROM THE END OF THE ASSESSMENT YEAR IN WHICH THE INCOME WAS FIRST ASSESSABLE. THE SUBMI SSION OF THE REVENUE IS TO THE EFFECT THAT LIMITATION EXPIRES ON LY ON 12 A M OF 01.01.2020. HOWEVER, THIS WOULD MEAN THAT AN ORDER OF ASSESSMENT CAN BE PASSED AT 12 A M ON 01.01.2020, WHEREAS, IN MY V IEW, SUCH AN ORDER WOULD BE HELD TO BE BARRED BY LIMITATION AS PROCEED INGS FOR ASSESSMENT SHOULD BE COMPLETED BEFORE 11.59.59 OF 31.12.2019. THE PERIOD OF 21 MONTHS THEREFORE, EXPIRES ON 31.12.2019 THAT MUST S TAND EXCLUDED SINCE SECTION 92CA(3A) STATES BEFORE 60 DAYS PRIOR TO TH E DATE ON WHICH THE PERIOD OF LIMITATION REFERRED TO SECTION 153 EXPIR ES. EXCLUDING 31.12.2019, THE PERIOD OF 60 DAYS WOULD EXPIRE ON 01.11.2019 AND THE TRANSFER PRICING ORDERS THUS OUGHT TO HAVE BEEN PAS SED ON 31.10.2019 OR ANY DATE PRIOR THERETO. INCIDENTALLY, THE BOARD, IN THE CENTRAL ACTION PLAN ALSO INDICATES THE DATE BY WHICH THE TRANSFER PRICING ORDERS ARE TO BE PASSED AS 31.10.2019. THE IMPUGNED ORDERS ARE TH US, HELD TO BE BARRED BY LIMITATION. 20. IN THE INSTANT CASE, LD. AR FOR THE TAXPAYER CO NTENDED THAT THE PERIOD OF 60 DAYS IS TO BE COMPUTED AS PER TABLE GI VEN BELOW :- DATE OF ASSESSMENT ORDER 31.03.2013 NO. OF DAYS IN MARCH 30 NO. OF DAYS IN FEBRUARY 28 NO. OF DAYS IN JANUARY 2 TOTAL 60 DAYS 21. IDENTICAL ISSUE HAS ALSO BEEN DEALT WITH BY THE COORDINATE BENCH OF THE TRIBUNAL IN CASE OF HONDA TRADING CORPORATION VS. DCIT IN ITA NO.1132/DEL/2015 ORDER DATED 15.09.2015 BY RETURNING FOLLOWING FINDINGS :- 5.27. IT IS, THEREFORE, SUMMED UP THAT THE TIME L IMIT FOR COMPLETION OF ASSESSMENT, OR IN OTHER WORDS, PASSIN G OF THE FINAL ASSESSMENT ORDER PURSUANT TO THE ORDER OF THE TPO, IS CONTAINED IN SECTION 144C(4) AND (13); THE TIME LIMIT GIVEN U /S 153 HAS NO RELATION WHATSOEVER WITH THE PASSING OF THE DRAFT O RDER, WHICH SHOULD BE PASSED WITHIN A REASONABLE TIME; AND THE TIME LIMIT GIVEN IN SECTION 153 IS RELEVANT FOR DETERMINING TH E TIME AVAILABLE WITH THE TPO FOR PASSING ORDER U/S 92CA(3). 5.28. TURNING TO THE FACTS OF THE INSTANT CASE, WE FIND THAT THE AO PASSED THE FINAL ASSESSMENT ORDER ON 29.1.2015, WHICH IS WELL WITHIN A PERIOD OF ONE MONTH FROM THE END OF THE MO NTH IN WHICH ITA NO.2381/DEL./2014 12 DIRECTION WAS RECEIVED FROM THE DRP ON 24.12.2014. AS SUCH, WE HOLD THAT THE FINAL ASSESSMENT ORDER PASSED BY THE AO IS WITHIN THE TIME PRESCRIBED U/S 144C(13). FURTHER SINCE THE DRAFT ORDER HAS ALSO BEEN PASSED WITHIN A REASONABLE TIME, THE SAME IS ALSO NOT BARRED BY LIMITATION. THE CONTENTION OF THE LD. AR THAT THE DRAFT ORDER PASSED IN THIS CASE WAS BARRED BY LIMIT ATION, IS THEREFORE, FOUND TO BE WITHOUT ANY SUBSTANCE AND HE NCE REPELLED. B. TIME LIMIT FOR PASSING OF ORDER BY THE TPO 6.1. THE LD. AR ALSO CHALLENGED THE PASSING OF THE ORDER BY THE TPO. IT WAS SUBMITTED THAT THE TPO PASSED ORDER ON 31.5.2014, WHICH WAS TIME BARRED AND, HENCE, THE SAME SHOULD B E ANNULLED LEADING TO THE QUASHING OF THE FINAL ASSESSMENT ORD ER. IN THE OPPOSITION, THE LD. DR SUPPORTED THE REVENUE'S STAN D. 6.2. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUS ED THE RELEVANT MATERIAL ON RECORD. IT HAS BEEN NOTICED AB OVE THAT THE PROVISIONS OF SECTION 92CA REQUIRING THE PASSING OF THE ORDER BY THE TPO DETERMINING THE ALP OF THE INTERNATIONAL TR ANSACTIONS, CAME INTO BEING BY THE FINANCE ACT, 2002. AS PER SU B-SECTION (3) OF SECTION 92C, THE TPO IS REQUIRED TO PASS THE ORD ER DETERMINING THE ALP OF THE INTERNATIONAL TRANSACTIONS. NO TIME LIMIT WAS INITIALLY GIVEN FOR THE PASSING OF ORDER BY THE TPO . IT IS ONLY BY THE FINANCE ACT, 2007, THAT SUB-SECTION (3A) WAS IN SERTED PROVIDING TIME LIMIT FOR THE PASSING AN ORDER BY TH E TPO. NO AMENDMENT HAS BEEN CARRIED OUT IN THIS PROVISION TH EREAFTER. SUB-SECTION (3A) OF SECTION 92CA CONTAINING THE REL EVANT TIME LIMIT FOR THE PASSING OF THE ORDER BY THE TPO, READ S AS UNDER : - `(3A) WHERE A REFERENCE WAS MADE UNDER SUB-SECTION (1) BEFORE THE 1ST DAY OF JUNE, 2007 BUT THE ORDER UNDE R SUB- SECTION (3) HAS NOT BEEN MADE BY THE TRANSFER PRICI NG OFFICER BEFORE THE SAID DATE, OR A REFERENCE UNDER SUB- SECTION (1) IS MADE ON OR AFTER THE 1ST DAY OF JUNE , 2007, AN ORDER UNDER SUB-SECTION (3) MAY BE MADE AT ANY T IME BEFORE SIXTY DAYS PRIOR TO THE DATE ON WHICH THE PE RIOD OF LIMITATION REFERRED TO IN SECTION 153, OR AS THE CA SE MAY BE, IN SECTION 153B FOR MAKING THE ORDER OF ASSESSM ENT OR REASSESSMENT OR RECOMPUTATION OR FRESH ASSESSMENT, AS THE CASE MAY BE, EXPIRES.'. 6.3. IT TRANSPIRES FROM A READING OF THE ABOVE PRO VISION THAT WHERE A REFERENCE IS MADE TO THE TPO AFTER 1.6.2007 , AN ORDER UNDER SUB-SECTION (3) MAY BE MADE AT ANY TIME BEFOR E 60 DAYS PRIOR TO THE DATE ON WHICH THE PERIOD OF LIMITATION REFERRED TO IN SECTION 153, OR, AS THE CASE MAY BE, IN SECTION 153 B, FOR MAKING THE ORDER OF ASSESSMENT OR RE-ASSESSMENT, ETC., EXP IRES. ITA NO.2381/DEL./2014 13 6.4. THE LD. DR VEHEMENTLY CONTENDED THAT THE USE OF THE WORD `MAY' IN THIS PROVISION FOR THE PASSING OF THE ORDE R BY THE TPO WITHIN A PERIOD OF 60 DAYS OF THE LIMITATION SET OU T IN SECTION 153 INDICATES THAT THE ADHERENCE TO THIS TIME LIMIT IS NOT MANDATORY. HE CONTENDED THAT EVEN IF THE ORDER IS PASSED AFTER THE PERIOD OF 60 DAYS FROM THE PERIOD OF LIMITATION AS GIVEN U/S 153, STILL IT WOULD BE TREATED AS HAVING BEEN PASSED WITHIN TIME. THIS ARGUMENT WAS COUNTERED BY THE LD. AR. 6.5. THERE IS NO DOUBT THAT THE LEGISLATURE HAS US ED THE WORD `MAY' IN SUB-SECTION (3A) OF SECTION 92CA. THERE IS FURTHER NO DOUBT THAT THE AMBIT OF THE WORD `MAY' IS DIFFERENT FROM THE WORD `SHALL'. WHEREAS, ORDINARILY THE USE OF THE WORD `S HALL' SIGNIFIES MANDATORY COMPLIANCE, THE WORD 'MAY' SIGNIFIES DIRE CTORY COMPLIANCE. BUT AT TIMES, THE WORD `MAY' CAN ALSO B E READ AS `SHALL' AND VICE VERSA. IN FACT, ALL DEPENDS UPON T HE CONTEXT AND THE BACKGROUND OF THE PROVISION IN WHICH SUCH A WOR D IS USED. 6.6. SECTION 127 DEALS WITH THE POWER TO TRANSFER CASES. SUB- SECTION (1) OF THIS PROVISION PROVIDES THAT : `THE DIRECTOR GENERAL OR CHIEF COMMISSIONER OR COMMISSIONER MAY, AFTER GI VING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD IN THE MATTER, WHEREVER IT IS POSSIBLE TO DO SO, AND AFTER RECORDI NG HIS REASONS FOR DOING SO, TRANSFER ANY CASE FROM ONE OR MORE AS SESSING OFFICERS SUBORDINATE TO HIM (WHETHER WITH OR WITHOU T CONCURRENT JURISDICTION) TO ANY OTHER ASSESSING OFFICER OR ASS ESSING OFFICERS (WHETHER WITH OR WITHOUT CONCURRENT JURISDICTION) A LSO SUBORDINATE TO HIM'. DISPUTE AROSE IN SAHARA HOSPIT ALITY LTD. VS. CIT (2013) 352 ITR 38 (BOM) AS TO WHETHER OR NOT GI VING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD BE FORE THE TRANSFER OF CASE BY THE CHIEF COMMISSIONER, IN THE BACKDROP OF THE USE OF THE WORD `MAY' IN THE PROVISION, BE CONS IDERED AS MANDATORY. THE HON'BLE BOMBAY HIGH COURT HAS HELD T HAT THE WORD `MAY' IN SECTION 127 SHOULD BE READ AS `SHALL' AND HENCE THE GRANTING OPPORTUNITY TO THE ASSESSEE IS MANDATORY. 6.7. SECTION 16 OF THE WEALTH-TAX ACT, 1957 DEALS W ITH THE ASSESSMENT OF WEALTH. SECTION 16A HAVING MARGINAL N OTE OF `REFERENCE TO VALUATION OFFICER' PROVIDES THROUGH S UB-SECTION (1) THAT : `FOR THE PURPOSE OF MAKING AN ASSESSMENT (IN CLUDING AN ASSESSMENT IN RESPECT OF ANY ASSESSMENT YEAR COMMEN CING BEFORE THE DATE OF COMING INTO FORCE OF THIS SECTION) UNDE R THIS ACT, WHERE UNDER THE PROVISIONS OF SECTION 7 READ WITH T HE RULES MADE UNDER THIS ACT OR, AS THE CASE MAY BE, THE RULES IN SCHEDULE III, THE MARKET VALUE OF ANY ASSET IS TO BE TAKEN INTO A CCOUNT IN SUCH ASSESSMENT, THE ASSESSING OFFICER MAY REFER THE VAL UATION OF ANY ASSET TO A VALUATION OFFICER- (A) IN A CASE WHERE T HE VALUE OF THE ASSET AS RETURNED IS IN ACCORDANCE WITH THE ESTIMAT E MADE BY A REGISTERED VALUER IF THE ASSESSING OFFICER IS OF OP INION THAT THE VALUE SO RETURNED IS LESS THAN ITS FAIR MARKET VALU E; (B) IN ANY ITA NO.2381/DEL./2014 14 OTHER CASE, IF THE ASSESSING OFFICER IS OF OPINION- (I) THAT THE FAIR MARKET VALUE OR THE ASSET EXCEEDS THE VALUE OF THE ASSET AS RETURNED BY MORE THAN SUCH PERCENTAGE OF THE VALUE OF THE ASSET AS RETURNED OR BY MORE THAN SUCH AMOUNT AS MAY BE P RESCRIBED IN THIS BEHALF; OR (II) THAT HAVING REGARD TO THE N ATURE OF THE ASSET AND OTHER RELEVANT CIRCUMSTANCES, IT IS NECESSARY S O TO DO'. IN RAJ PAUL OSWAL VS. CWT (1988) 171 ITR 489 (P&H), THERE AROSE A QUARREL AS TO THE MEANING OF THE WORD `MAY' USED IN SECTION 16A IN THE CONTEXT OF MAKING REFERENCE TO THE VALUATION OFFICER. SETTLING THE CONTROVERSY, THE HON'BLE HIGH COURT HE LD THAT THE WORD `MAY' USED IN SECTION 16A(1)(B), SHOULD BE REA D AS `SHALL'. IT HELD THAT IF THE LEGISLATIVE INTENT HAD BEEN TO ACC ORD TOTAL DISCRETION TO THE WTO TO MAKE A REFERENCE TO THE VA LUATION OFFICER OR NOT IN CASES WHICH WERE COVERED BY CLS. (A) & (B) OF SUB-S. (1) OF S. 16A OF THE WT ACT, THEN THERE WAS NO NECESSITY OF PROVIDING THE GUIDELINES IN CL. (A) OR IN SUB-CLS. (I) AND (II) OF CL. (B) OF SUB-S. (1) OF S. 16A. IT WAS, THEREFORE, HEL D THAT THE LEGISLATURE BY PRESCRIBING THE CONTINGENCIES, IN WH ICH, BY IMPLICATION, IT WOULD NOT BE NECESSARY TO MAKE A RE FERENCE, ALSO AGAIN BY NECESSARY IMPLICATION BE TAKEN TO HAVE INT ENDED THAT THE REFERENCE TO VALUATION OFFICER WAS MUST IF THE GIVE N CONTINGENCIES DID NOT EXIST. IN THIS REGARD, THE HO N'BLE HIGH COURT OBSERVED THAT : `THERE IS NO DOUBT ABOUT THE FACT THAT THE USE OF EXPRESSION 'MAY' AND 'SHALL' TO SOME EXTENT SERVES AN INDICIA TO THE INTENTION OF THE LEGISLATURE AND HEL PS IN DECIDING AS TO WHETHER THE GIVEN REQUIREMENT IS DIRECTORY OR MA NDATORY IN CHARACTER, BUT THE USE OF EXPRESSION 'MAY' OR 'SHAL L' IS NEVER CONSIDERED DECISIVE IN THAT REGARD'. IT WAS THUS HE LD THAT THE MOMENT THE ESTIMATED VALUE EXCEEDED THE RETURNED VA LUE OF THE ASSET BY MORE THAN WHAT IS ENVISAGED BY R. 3B, THEN THE WTO HAD NO OPTION, BUT TO MAKE A REFERENCE AND HE IS NOT TO WAIT FOR A REQUEST FROM THE ASSESSEE TO MAKE A REFERENCE. SIMI LAR VIEW HAS BEEN EXPRESSED BY THE HON'BLE DELHI HIGH COURT IN S HARBATI DEVI JHALANI VS. CWT & ORS. (1986) 159 ITR 549 (DEL ). IT IS VIVID FROM THE ABOVE DISCUSSION THAT THE USE OF WOR D `MAY' OR `SHALL' IN A PROVISION IS NOT CONCLUSIVE OF ITS MAN DATORY OR DIRECTORY NATURE. ONE NEEDS TO GO THROUGH THE TEXT OF THE PROVISION AND THE CONTEXT IN WHICH SUCH A WORD HAS BEEN USED. 6.8. REVERTING TO SECTION 92CA, WE FIND THAT THE F INANCE ACT, 2007 INSERTED SUB-SECTION (3A) CARRYING THE TIME LI MIT OF SIXTY DAYS FOR PASSING OF THE ORDER BY THE TPO BEFORE THE EXPIRY OF TIME LIMIT FOR COMPLETION OF ASSESSMENT BY THE AO U/S 15 3. DESPITE THE USE OF THE WORD `MAY', THE TIME LIMIT FOR PASSING T HE ORDER BY THE TPO IS MANDATORY, AS IN THE OTHERWISE SITUATION OF THE TPO HAVING BEEN ALLOWED MORE TIME BY IMPLICATION, SAY O F THREE MONTHS OR MORE, COULD AT THAT TIME HAVE FRUSTRATED THE PROVISIONS OF SECTION 153 FOR THE PASSING OF THE ASSESSMENT OR DER BY THE AO. THUS WE HAVE NO HESITATION IN HOLDING THAT THE USE OF THE WORD `MAY' IN SUB-SECTION (3A) OF SECTION 92CA IS TO BE CONSTRUED AS ITA NO.2381/DEL./2014 15 `SHALL', THEREBY MAKING THIS TIME LIMIT AS MANDATOR Y AND NOT DIRECTORY. AS SUCH, IT IS HELD THAT THE TPO IS BOUN D BY THE GIVEN TIME LIMIT FOR PASSING OF HIS ORDER. 6.9. HAVING HELD THAT THE WORD `MAY' IN SECTION 92 CA(3A) SHOULD BE READ AS `SHALL', WE ONCE AGAIN NOTE THAT PRIOR TO THE INSERTION OF SECTION 144C BY THE FINANCE ACT, 2009, THE TIME LIMIT FOR COMPLETION OF ASSESSMENT WAS CONTAINED IN SECTI ON 153 AND ACCORDINGLY THE TIME LIMIT FOR THE PASSING OF THE O RDER BY THE TPO WAS ALSO SET OUT ACCORDINGLY IN SECTION 92CA W.R.T. THE TIME LIMIT FOR THE COMPLETION OF ASSESSMENT AS PER SECTION 153 . HOWEVER, WITH THE INSERTION OF SECTION 144C, THE TIME LIMIT FOR THE COMPLETION OF ASSESSMENT, OR IN OTHER WORDS, FOR PA SSING OF THE FINAL ASSESSMENT ORDER, STOOD SHIFTED TO SUB-SECTIO NS (4) OR (13) OF SECTION 144C AND GOT DETACHED FROM SECTION 153. ALO NG WITH THIS, PASSING OF DRAFT ORDER ALSO BECAME MANDATORY, FOR W HICH WE HAVE HELD ABOVE THAT THE SAME IS REQUIRED TO BE PASSED W ITHIN A REASONABLE TIME AND IT HAS GOT NO RELATION WITH THE TIME LIMIT GIVEN IN SECTION 153. WHEN THE POSITION IS SUCH THA T THE DRAFT ORDER HAS TO BE PASSED INDEPENDENT OF THE TIME LIMI T GIVEN IN SECTION 153, THERE APPEARS SOME LOGIC IN NOT CONTIN UING WITH THE TIME LIMIT FOR THE PASSING OF THE ORDER BY THE TPO TAGGED WITH THE TIME LIMIT GIVEN IN SECTION 153. IT HAS LED TO INCO HERENCE IN THE PROVISIONS. THIS POSITION CAN BE SET RIGHT ONLY WIT H A SUITABLE LEGISLATIVE AMENDMENT. 6.10. HAVING HELD THAT THE TIME LIMIT GIVEN IN SUB -SECTION (3A) OF SECTION 92CA IS MANDATORY FOR THE PASSING OF THE ORDER BY THE TPO, LET US FIND OUT THE TIME AVAILABLE WITH THE TP O FOR THE PASSING OF HIS ORDER. IT HAS BEEN NOTICED ABOVE THA T THE TIME LIMIT AS PER SECTION 153(1) READ WITH THE THIRD PROVISO A ND CLAUSE (VIII) OF THE EXPLANATION TO THE SECTION, COMES AT 7TH JUN E, 2014. PERIOD OF 60 DAYS PRIOR TO SUCH TIME LIMIT COMING A S PER SECTION 153, AVAILABLE WITH THE TPO FOR PASSING HIS ORDER, COMES TO AN END ON 8TH APRIL, 2014. AS AGAINST THIS, THE ORDER WAS ACTUALLY PASSED BY THE TPO ON 31ST MAY, 2014. THUS, THE ORDE R PASSED BY THE TPO IS PATENTLY TIME BARRED. C. CONSEQUENCES OF VALID DRAFT ORDER AND TPO'S TIM E BARRED ORDER 7. THE LD. AR ARGUED THAT SINCE THE DRAFT ORDER AS WELL AS THE ORDER OF THE TPO WERE TIME BARRED, THE FINAL ASSESS MENT ORDER PASSED BY THE AO WAS LIABLE TO BE SET ASIDE. WE HAV E HELD ABOVE THAT THE DRAFT ORDER WAS PASSED WITHIN TIME AND ONL Y THE ORDER OF THE TPO IS TIME-BARRED. WHEN AN ORDER IS PASSED WIT HOUT JURISDICTION OR BEYOND THE PERMISSIBLE TIME, IT IS CONSIDERED AS NULL AND VOID. THE EFFECT OF PASSING A NULL AND VOI D ORDER IS THAT IT IS CONSIDERED AS NON EST, MEANING THEREBY, THAT IT ENTAILS ALL THE CONSEQUENCES OF NOT HAVING BEEN PASSED AT ALL AND I S IGNORED FOR ITA NO.2381/DEL./2014 16 ALL PRACTICAL PURPOSES. THE HON'BLE MADRAS HIGH COU RT IN VIJAY TELEVISION (P.) LTD. VS. DRP (2014) 369 ITR 113 (MA D) CONSIDERED A CASE IN WHICH THE ASSESSMENT ORDER WAS DIRECTLY PASSED WITHOUT ROUTING THROUGH DRAFT ORDER OR DRP. THE HON'BLE COURT HELD IT TO BE A NON- CURABLE DEFECT AND RESUL TANTLY THE ASSESSMENT WAS QUASHED. IT WAS HELD THAT WHEN THERE IS AN OMISSION ON THE PART OF THE AO TO FOLLOW THE MANDAT ORY PROCEDURE PRESCRIBED UNDER THE ACT, SUCH AN OMISSIO N CANNOT BE TERMED AS A MERE PROCEDURAL IRREGULARITY AND IT CAN NOT BE CURED. EXTANTLY, WE ARE CONFRONTED WITH A SITUATION IN WHI CH THE DRAFT ORDER HAS BEEN PASSED IN TIME BUT THE LAPSE HAS COM E IN THE PASSING OF THE ORDER BY THE TPO. THE CONSEQUENCE OF THE ABOVE SCENARIO IS THAT THE PASSING OF A VALID AND PROPERL Y TIMED DRAFT ORDER CANNOT LEAD TO THE SETTING ASIDE OF THE FINAL ASSESSMENT ORDER. HOWEVER THE PASSING OF THE TIME BARRED ORDER BY THE TPO, WHICH IS AGAIN A MANDATORY PROCEDURE PRESCRIBED UND ER THE ACT, WOULD BE A NON-CURABLE DEFECT, HAVING THE CONSEQUEN CE AS IF IT WAS NOT PASSED. IN SUCH CIRCUMSTANCES, THOUGH THE F INAL ASSESSMENT ORDER WOULD BE SAVED BUT THE ADDITION ON ACCOUNT OF TRANSFER PRICING ADJUSTMENT ARISING FROM THE DETERM INATION OF THE ALP OF THE INTERNATIONAL TRANSACTIONS BY THE TPO AS EMANATING FROM HIS TIME BARRED ORDER, WOULD BE UNSUSTAINABLE. WE HOLD ACCORDINGLY AND DIRECT THE DELETION OF ADDITION ON ACCOUNT OF TRANSFER PRICING ADJUSTMENT MADE IN THE FINAL ASSES SMENT ORDER. 22. LD. DR FOR THE REVENUE, ON THE OTHER HAND, CONT ENDED THAT THE LD. TPO HAS PASSED ORDER IN THIS CASE WELL WITH IN TIME BUT DUE TO INADVERTENCE DATE OF ORDER IS WRITTEN AS 31.01.2 013 INSTEAD OF 30.01.2013 AND RELIED UPON COPY OF DISPATCH REGISTE R, WHEREIN FILE OF THE INSTANT CASE IS REPORTED TO BE SENT TO DIT F OR APPROVAL VIDE DISPATCH NO.897 ON 30.01.2013. 23. WE ARE UNABLE TO AGREE WITH THE CONTENTION RAIS ED BY THE LD. DR FOR THE REVENUE FOR TWO REASONS :- (I) THAT ANY ORDER PASSED BY THE QUASI-JUDICIAL AUT HORITY IN DISCHARGE OF ITS OFFICIAL DUTIES IS TO BE TAKEN AT FACE VALUE; AND ITA NO.2381/DEL./2014 17 (II) THAT IN CASE, IT WAS A CLERICAL ERROR AS TO TH E DATE OF PASSING THE ORDER, THE LD. TPO WAS WELL WITHIN HIS RIGHTS TO GET THE DATE RECTIFIED U/S 154 OF THE ACT BUT RIGHT FROM 31.01.2013 NO SUCH POWER HAS BEEN EXERCISED. 24. LD. AR FOR THE TAXPAYER FURTHER CONTENDED THAT FOR ARGUMENT SAKE, EVEN IF THE ORDER PASSED BY THE TPO IS TAKEN HAVING BEEN PASSED ON 30.01.2013, STILL IT IS BARRED BY LIMITAT ION BECAUSE ORDER WAS REQUIRED TO BE PASSED BEFORE 60 DAYS PRIOR TO T HE DATE ON WHICH LIMITATION REFERRED TO IN SECTION 153 EXPIRES, WHIC H ACTUALLY EXPIRES ON 20.01.2013. 25. COMPUTATION OF PERIOD OF 60 DAYS GIVEN BY THE T AXPAYER EXTRACTED IN THE PRECEDING PARA NO.20 CANNOT BE FAU LTED WITH ON ANY GROUND BECAUSE FROM 31.03.2013, THE DATE OF PASSING ORDER OF THE AO, 60 DAYS WAS TO BE COMPUTED BY EXCLUDING THE DAT E OF ORDER I.E. 31.03.2013. SO, WHILE EXCLUDING THE DATE 31.03.201 3, THE DAY OF PASSING THE ORDER, THE ORDER WAS REQUIRED TO BE PAS SED BY THE TPO BY 29.01.2013 WHEREAS THE IMPUGNED ORDER HAS BEEN P ASSED ON 31.01.2013 WHICH IS BARRED BY LIMITATION. 26. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE AND FO LLOWING THE DECISION RENDERED BY HONBLE MADRAS HIGH COURT AND THE ORDER PASSED BY THE COORDINATE BENCH OF THE TRIBUNAL IN C ASES OF M/S. ITA NO.2381/DEL./2014 18 PFIZER HEALTHCARE INDIA PVT. LTD. AND HONDA TRADING CORPORATION (SUPRA) RESPECTIVELY AND MANDATE OF SECTION 92CA (3 ) READ WITH SECTION 153 OF THE ACT, IMPUGNED ORDER PA SSED BY THE LD. TPO IS BARRED BY LIMITATION WHICH WAS REQUIRED TO B E PASSED BY 29.01.2013 AND AS SUCH IS HEREBY QUASHED. 27. CONSEQUENT ADDITIONS MADE ON ACCOUNT OF TRANSFE R PRICING ADJUSTMENT BY WAY OF DETERMINING THE ALP TRANSACTIO N BY THE TPO ARE ALSO NOT SUSTAINABLE IN THE EYES OF LAW, THE OR DER OF THE TPO (SUPRA) BEING BARRED BY LIMITATION. SINCE VIDE ASS ESSMENT ORDER DATED 24.02.2014 AO HAS MADE ADDITION ON ACCOUNT OF DETERMINATION OF ALP OF INTERNATIONAL TRANSACTION, SUCH ADDITION STANDS DELETED BEING ORDER OF LD. TPO BARRED BY LIM ITATION, BUT THE ASSESSMENT ORDER U/S 143 (3) PASSED BY AO IS IN TIM E, IT STANDS EXCEPT THOSE ADDITIONS PROPOSED BY LD. TPO. THUS, ADDITIONS MADE BY AO, BASED ON ORDER OF LD. TPO, STAND DELETED WIT HOUT ENTERING INTO GROUNDS RAISED ON MERITS BY THE TAXPAYER. CON SEQUENTLY, THE APPEAL FILED BY THE TAXPAYER IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THIS 11 TH DAY OF MARCH , 2021. SD/- SD/- (PRASHANT MAHARISHI) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 11 TH DAY OF MARCH, 2021/TS ITA NO.2381/DEL./2014 19 COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.DRP 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.