DRP Order Served on Upload Date – Delayed FAO Quashed | HC

Case Details: Commissioner of Income-tax International Taxation vs. Hyundai Rotem Company [2025] 180 taxmann.com 18 (Delhi)

Judiciary and Counsel Details

• V. Kameswar Rao & Vinod Kumar, JJ.
• Sunil Agarwal, SSC, Viplav Acharya, Utkarsh Tiwari, Adv. & Ms Priya Sarkar, JSC for the Appellant.
• Ms Ananya Kapoor, Ms Soumya Singh & Sumit Lalchandani, Advs. for the Respondent.

Facts of the Case

The assessee was a Korean company engaged in the production of various types of railway vehicles. The assessee filed its return of income. The case was selected through CASS, and notice under section 143(2) was issued. By way of assessment proceedings, the case was referred to a Transfer Pricing Officer (TPO). The TPO passed the order under section 92CA(3) proposing an upward adjustment in respect of ‘provision of administrative support services’.

Based on the TPO’s report, the Assessing Officer (AO) passed the Draft Assessment Order proposing assessed income. The assessee filed objections before the Dispute Resolution Panel (DRP) against the Draft Assessment Order. The DRP directed the Assessing Officer to pass the final assessment order in accordance with the directions contained in the DRP order. Pursuant to the DRP’s direction, the TPO revised the adjustment, and the AO issued the Final Assessment Order (FAO).

The assessee submitted that the FAO passed on the pivotal issue was vitiated in law owing to the bar of limitation and thus non est in law at the threshold as the timelines as provided under section 144C(13) were not satisfied.

The Tribunal held that the DRP directions were uploaded to the ITBA portal on 26-5-2022, and the Assessing Officer was deemed to have received them on that date. The Assessing Officer was required to pass the final assessment order within one month from the end of the month in which the directions were received, i.e. by 30-6-2022. Since the Assessing Officer passed the final assessment order on 1-7-2022, the same was time-barred and was to be quashed.

The matter reached the Delhi High Court.

High Court Held

The High Court held that the date of uploading the order of the DRP will ipso facto be deemed service on the recipient, especially when the DRP proceedings are also assessment proceedings. As part of the larger Faceless Assessment Regime, all filed and uploaded directives of the DRP would be deemed sufficient service. The period of limitation as prescribed under section 144C(13) would be liable to be computed from the date of uploading of the order, and the Assessing Officer shall pass the Assessment Order, bearing that crucial date in mind.

Thus, the Assessing Officer was required to pass the final assessment order within one month from the end of the month in which the directions were received, i.e., by 30-6-2022. Since the Assessing Officer passed the final assessment order on 1-7-2022, the same was time-barred and was to be quashed.

List of Cases Reviewed

• Louis Dreyfus Company India (P.) Ltd. v. Deputy Commissioner of Income-tax [2024] 159 taxmann.com 244/464 ITR 595 (Delhi) and Vodafone Idea Ltd. v. Central Processing Centre [2023] 156 taxmann.com 258 (Bombay)/[2023] 459 ITR 413 (Bombay) [Para 49] Followed
  CCE v. M. M. Rubber & Company 1992 taxmann.com 555, CIT, Chennai v. Mohammed Meeran Shahul Hameed [2021] 131 taxmann.com 94/438 ITR 288/283 Taxman 454 (SC), Principal, Commissioner, Customs v. GAIL (India) Ltd. [2025] 151 GSTR 306 (Guj.), Suman Jeet Agarwal v. ITO [2022] 143 taxmann.com 11 (Delhi)/[2023] 290 Taxman 493 (Delhi)/[2022] 449 ITR 517 (Delhi), CIT, Central-II v. Sudhir Choudhrie [2005] 278 ITR 490/147 Taxman 306 (Delhi), CIT-7 v. Odeon Builders (P.) Ltd. [2017] 80 taxmann.com 180/393 ITR 27/247 Taxman 184 (Delhi), CIT v. Arvind Construction Co. (P.) Ltd. [1991] 59 Taxman 461 (Delhi)/[1992] 193 ITR 330 (Delhi), Kanwar Singh Saini v. High Court of Delhi (2012) 4 SCC 307, Commissioner Central Excise v. Raghuvar India Ltd 2000 taxmann.com 1349 (para 25), Jaipuria Samla Amalgamated Collieries Ltd. v. CIT [1971] 82 ITR 580 (SC), Canon India (P.) Ltd. v. Commissioner of Customs [2021] 125 taxmann.com 188 (SC) and CIT v. Income-tax Appellate Tribunal [2000] 112 Taxman 355 (Delhi)/[2000] 245 ITR 659 (Delhi)[Para 49] Distinguished
  Hyundai Rotem Company Indian Project Offices v. ACIT, International Taxation [2024] 169 taxmann.com 367/[2025] 210 ITD 326(Delhi – Trib.)[Para 50] Affirmed

List of Cases Referred to

• Hyundai Rotem Company Indian Project Offices v. ACIT, International Taxation [2024] 169 taxmann.com 367/[2025] 210 ITD 326(Delhi – Trib.) (para 3), CCE v. M. M. Rubber & Company 1992 taxmann.com 555 (para 18), CIT, Chennai v. Mohammed Meeran Shahul Hameed [2021] 131 taxmann.com 94/438 ITR 288/283 Taxman 454 (SC) (para 18), Principal, Commissioner, Customs v. GAIL (India) Ltd. [2025] 151 GSTR 306 (Guj.) (para 21), Suman Jeet Agarwal v. ITO [2022] 143 taxmann.com 11 (Delhi)/[2023] 290 Taxman 493 (Delhi)/[2022] 449 ITR 517 (Delhi) (para 22), R.K. Upadhyaya v. Shanabhai P. Patel [1987] 166 ITR 163/33 Taxman 229 (SC) (para 22), CIT, Central-II v. Sudhir Choudhrie [2005] 278 ITR 490/147 Taxman 306 (Delhi) (para 23), CIT-7 v. Odeon Builders (P.) Ltd. [2017] 80 taxmann.com 180/393 ITR 27/247 Taxman 184 (Delhi) (para 23), CIT v. Arvind Construction Co. (P.) Ltd. [1991] 59 Taxman 461 (Delhi)/[1992] 193 ITR 330 (Delhi) (para 25), CIT v. Income-tax Appellate Tribunal [2000] 112 Taxman 355 (Delhi)/[2000] 245 ITR 659 (Delhi) (para 25), Kanwar Singh Saini v. High Court of Delhi (2012) 4 SCC 307 (para 25), National Thermal Power Co. Ltd. v. CIT [1998] 229 ITR 383/97 Taxman 358 (SC) (para 25), Commissioner Central Excise v. Raghuvar India Ltd 2000 taxmann.com 1349 (para 25), Jaipuria Samla Amalgamated Collieries Ltd. v. CIT [1971] 82 ITR 580 (SC) (para 25), Canon India (P.) Ltd. v. Commissioner of Customs [2021] 125 taxmann.com 188 (SC) (para 25), CIT v. Ramco Cements Ltd. [2025] 171 taxmann.com 306 (Madras)/[2025] 474 ITR 9 (Madras) (para 28), Taeyang Metal India (P.) Ltd. v. Dy. CIT [2024] 160 taxmann.com 536 (Madras) (para 28), Himalaya Drug Company v. Dy. CIT [2025] 176 taxmann.com 55 (Karnataka) (para 28), Vodafone Idea Ltd. v. Central Processing Centre [2023] 156 taxmann.com 258 (Bombay)/[2023] 459 ITR 413 (Bombay) (para 28), Louis Dreyfus Company India (P.) Ltd. v. Dy. CIT [2024] 159 taxmann.com 244/464 ITR 595 (Delhi) (para 28), Pr. CIT v. Sterling Oil Resources Ltd. [2025] 171 taxmann.com 581 (Bombay) (para 28), Rapiscan Systems (P.) Ltd. v. ADIT (Int.Tax)-2 [2025] 170 taxmann.com 753/473 ITR 485 (TELANGANA) (para 28), Vodafone India Services (P.) Ltd. v. Union of India [2013] 39 taxmann.com 201 /[2014] 221 Taxman 116 /[2013] 361 ITR 531 (Bombay) (para 31), Lahmeyer Holding GMBH v. Deputy DIT, Circle 3(2) [2015] 59 taxmann.com 336/376 ITR 70/232 Taxman 829 (Delhi) (para 31), Pr. CIT v. Fiberhome India (P.) Ltd. [2024] 159 taxmann.com 772/[2025] 482 ITR 221 (Delhi) (para 36), Central Processing Centre v. Vodafone Idea Ltd. [2025] 170 taxmann.com 834 (SC) (para 36) and Shell India Markets (P.) Ltd. v. Addl. CIT/ITO, National Faceless Assessment Centre New Delhi [2022] 139 taxmann.com 335/443 ITR 366 (Bombay) (para 36).

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