The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has d๐ฒ๐น๐ฒ๐๐ฒd ๐ฑ๐ฒ๐บ๐ฎ๐ป๐ฑ ๐ผ๐ณ ๐ฅ๐ ๐ฑ๐ฐ๐ต ๐๐ฟore against ๐ ๐ถ๐ฐ๐ฟ๐ผ๐๐ผ๐ณ๐ ๐๐ป๐ฑ๐ถ๐ฎ citing limitation.
The bench of Mahavir Singh, Vice President (Third Member) has sided with the Judicial Member. Relying on Section 144C(13) read with provisions of the Information Technology Act, 2000, he held that the receipt of DRP directions occurred when they were uploaded on the ITBA portal on April 1, 2022, making the last permissible date for passing the final assessment May 31, 2022 . Consequently, the order dated June 30, 2022, was held to be time-barred.
The matter arose from an assessment order dated June 30, 2022, issued under Section 143(3) read with Section 144C(13) of the Act by the Deputy Commissioner of Income Tax, Circle 16(1), Delhi, following directions from the Dispute Resolution Panel (DRP). Microsoft India, represented by counsel Shri Nageswar Rao, contested the order on the preliminary ground that it was passed beyond the statutory time limit.
Core Issue: Date of Receipt of DRP Directions
The DRP issued its directions on March 23, 2022, which were uploaded on the Income Tax Business Application (ITBA) portal on April 1, 2022, and communicated to the Assessing Officer through speed post on April 4, 2022 . As per Section 144C(13), the Assessing Officer must complete the assessment โwithin one month from the end of the monthโ in which such directions are received.
Microsoft argued that since the directions were received in April 2022, the assessment should have been completed by May 31, 2022. However, the order was passed only on June 30, 2022, rendering it void.
Divergence of Opinion Within ITAT
The Judicial Member (Shri Vikas Awasthy) agreed with the assessee, holding the assessment order to be time-barred and without jurisdiction . Conversely, the Accountant Member (Shri Brajesh Kumar Singh) dismissed Microsoftโs plea, ruling that the order was within limitation since the jurisdictional Assessing Officer formally received the DRP directions on May 20, 2022, thus making the June 30, 2022 order valid .
Due to this split, the matter was referred to the Honโble President of ITAT under Section 255(4), who appointed Vice President Shri Mahavir Singh as Third Member.
The tribunal allowed the appeal.
Case Details
Case Title: Microsoft Corporation (India) P. Ltd Versus Deputy Commissioner of Income-Tax
Case No.: ITA NO.1862/DEL/2022 (A.Y.2017-18)
Date: 04/09/2025
Counsel For Appellant: Nageswar Rao
Counsel For Respondent: Rajesh Kumar
