CLASSIC LEGENDS PVT. LTD. Vs. ASSESSMENT UNIT

JUDGEMENT

(1.) Rule. Respondents waive service. With the consent of the parties, Rule made returnable forthwith and heard finally.

(2.) The above Writ Petition is filed seeking to quash and set aside the impugned Draft Assessment Order dtd. 8/3/2025 passed under Sec. 144C and the Final Assessment Order dtd. 7/4/2025 passed under Sec. 143 (3) read with Sec. 144C and Sec. 144B of the Income Tax Act, 1961 ("for short "I. T. Act"). Consequently, the Demand Notice issued under Sec. 156 as well as the Show Cause Notice issued for imposing penalty under Sec. 270A and Sec. 271AAC are also impugned.

(3.) The short ground on which all these orders and notices are impugned is that the Assessing Officer has wrongly invoked the provisions of Sec. 144C which relate to a reference to the Dispute Resolution Panel. According to the Petitioner, in the facts of the present case, initially the Assessing Officer had made a reference to the Transfer Pricing Officer ("TPO") under Sec. 92CA of the I. T. Act. Pursuant to this reference, the TPO issued notices to the Petitioner and thereafter passed an order under Sec. 92CA(3) accepting that the international transactions entered into by the Petitioner with its Associated Enterprises were at an Arms Length Price. In other words, the TPO made no variation. According to the Petitioner, by virtue of the definition of the words "eligible assessee" appearing in Sec. 144C(15), the Petitioner could never fall within the aforesaid definition because the TPO never made any variation. Since no variation was made, there was no occasion for the Assessing Officer to pass any Draft Assessment Order and thereafter serve it upon the Petitioner. In other words, the Assessing Officer ought to have passed his Assessment Order under Sec. 143 (3) without invoking the provisions of Sec. 144C of the I. T. Act.