M/S Altair Engineering India Pvt Ltd V. Additional/Joint/Deputy/Assistant Commissioner of Income Tax/Income Tax Officer National E-Assessment Centre Delhi

WP/13620/2021

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The case involves M/S Altair Engineering India Pvt Ltd, represented by its Managing Director, Vishwanatha Rao, challenging the final assessment order and demand notice issued by the Income Tax Department for the assessment year 2017-18. The petitioner argued that the final assessment was passed without considering their objections, which were filed manually due to a breakdown of the e-proceeding system on the day the final order was issued. The court considered the impact of the COVID-19 pandemic, relevant CBDT circulars, and the Supreme Court's judgment on the extension of limitation periods, leading to the decision to set aside the assessment order and remit the case back to the DRP.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 691795 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 27-03-2024
• Assessment Year: misc
• Other Referred Cases: In Re: Cognizance for Extension of Limitation - 2022 (3) SCC 117
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: RAVI RAJ
• Assessee Lawyers: CHYTANYA SHARATH
• Keywords: CBDT Circular; Covid-19 pandemic; Dispute Resolution Panel; E-proceeding; Final Assessment Order; Transfer Pricing Officer; Writ petition
• Section: 143(3); 144C(13); 144B; 92CA(3)

Judgement Text

" - 1 - NC: 2024:KHC:12610 WP No. 13620 of 2021 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 27TH DAY OF MARCH, 2024 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 13620 OF 2021 (T-IT) BETWEEN: M/S ALTAIR ENGINEERING INDIA PVT LTD (REPRESENTED VISHWANATHA RAO MANAGING DIRECTOR, S/O RAJARAM AGED ABOUT 45 YEARS NO.46, FIRST FLOOR, PRESTIGE TRADE TOWER, PALACE ROAD, MUNICIPAL WARD NO.77, SMPANGIRAMANAGAR BENGALURU - 560 001. …PETITIONER (BY SRI. CHYTANYA.K.K., SENIOR COUNSEL FOR SRI. SHARATH., ADVOCATE) AND: ADDITIONAL /JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER NATIONAL E-ASSESSMENT CENTRE DELHI, ROOM NO.401, 2ND FLOOR,E-RAMP, JAWAHARLAL DELHI- 110 003 …RESPONDENT (BY SRI. RAVI RAJ Y V.,ADVOCATE) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH AS FAR AS THE PETITIONER IS CONCERNED BY AN ORDER, THE IMPUGNED FINAL ASSESSMENT ORDER PASSED BY THE RESPONDENT UNDER 143(3) R/W/S 144C(13) AND 144B OF THE IT ACT DATED 30.06.2021 FOR A.Y.2017-18, ENCLOSED AS ANNEXURE-A AND ETC. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING: Digitally signed by VANDANA S Location: High Court of Karnataka - 2 - NC: 2024:KHC:12610 WP No. 13620 of 2021 ORDER In this petition, petitioner seeks quashing of the impugned final assessment order at Annexure-A dated 30.06.2021 and the consequential demand notice at Annexure-B dated 30.06.2021 and for other reliefs. 2. Heard learned Senior counsel for the petitioner and learned counsel for the respondents – revenue and perused the material on record. 3. A perusal of the material on record will indicate that in relation to the assessment year 2017-18, pursuant to reference being made to the Transfer Pricing Officer (TPO) in accordance with the provisions of Section 92CA(3) of the Income Tax Act, 1961 (for short ‘the I.T.Act’), the TPO passed an order dated 26.01.2021 determining the T.P adjustment which was followed by a draft assessment order dated 11.04.2021 passed by the respondents. Subsequently, in the light of the prevailing covid-19 pandemic and the judgment of the Apex Court In Re: Cognizance for Extension of Limitation - 2022 (3) SCC 117 and the CBDT Circular dated 30.04.2021 relaxing the time limit and extending the due date for filing objections before the Dispute Resolution Panel (DRP) upto - 3 - NC: 2024:KHC:12610 WP No. 13620 of 2021 31.05.2021, the petitioner submitted a representation requesting for extension of time to file objections before the DRP by condoning the delay and also requested the respondent not to pass final assessment order. Thereafter, on 01.06.2021, the e-proceeding website / portal of the respondent – Department broke down, as a result of which, the petitioner was constrained to file objection before the DRP in Form-35A manually and could not communicate the same to the respondent. It is the grievance of the petitioner that though the lock down was lifted only 03.07.2021, the e- proceeding website / portal of the respondent – Department was reinstated on 30.06.2021, on which day itself, the respondent proceeded to pass the impugned final assessment order against the petitioner without taking into account the objection of the petitioner filed manually on 23.06.2021 nor providing sufficient or reasonable opportunity to the petitioner, who is before this Court by way of the present petition. 4. Per contra, learned counsel for the respondent – revenue submits that there is no merit in the petition and that the same is liable to be dismissed. - 4 - NC: 2024:KHC:12610 WP No. 13620 of 2021 5. As rightly contended by the learned Senior counsel for the petitioner, the cumulative effect of the prevailing Covid-19 pandemic, the CBDT Circular extending the due date to file objections before the DRP upto 31.05.2021, the judgment of the Apex Court in In Re: Cognizance for Extension of Limitation - 2022 (3) SCC 117, the filing of objections by the petitioner manually before the DRT on 23.06.2021, since the e-proceeding website/ portal was non-operational / non-functional on account of breakdown and lifting of the lock down only on 03.07.2021 and other material on record is sufficient to come to the conclusion that the impugned order and notice deserve to be set aside and the matter remitted back to the respondent for reconsideration afresh after necessary directions are issued by the DRP, pursuant to which, the respondent shall pass appropriate orders in accordance with law. 6. In the result, I pass the following:- ORDER (i) Petition is hereby allowed. (ii) The impugned order at Annexure-A dated 30.06.2021 and consequent demand notice at Annexure-B dated 30.06.2021 are hereby set aside. - 5 - NC: 2024:KHC:12610 WP No. 13620 of 2021 (iii) The matter is remitted back to the Dispute Resolution Panel (DRP) for reconsideration of the claim of the petitioner afresh in accordance with law. (iv) Liberty is reserved in favour of the petitioner to submit additional pleadings, documents etc., before the DRP, who shall consider the same and proceed further to issue directions after providing sufficient and reasonable opportunity to the petitioner in accordance with law. (v) Immediately upon receipt of directions by DRP, respondent herein shall provide sufficient and reasonable opportunity to the petitioner and proceed further and pass appropriate orders in accordance with law. SD/- JUDGE LRS/SRL "