LIMITATION IN TRANSFER PRICING MATTERS

Meaning of  the expression "Month"

Under Section 3 (35) of  The General Clauses Act a month implies a calendar month.

 

Section 144C (13) stipulates that the assessing officer shall in conformity  with the directions of the dispute resolution panel complete the assessment within one  month from the end of the month in which the directions  of the dispute resolution panel have been received by the assessing officer. In this connection the Kerala High Court has held in CAgIT Vs Kappumalai Estate [1998]148CTR565(Ker)  that completion of assessment also means dispatch of the same so as to be beyond the control of the authority concerned , for any possible change or modification.

In CIT Vs Kadri Mills [1977]106 ITR 846  (Mad)  and Lacchhmi Narain Gupta vs CIT [2014]42 Taxmann.com 27 it has been held that month means a calendar month. An analysis of the possible dates in a hypothetical case by which limitation to complete the assessment order u/s 144C(13) is given hereunder;

Date of receipt of DRP  order	30/11/2014
Limitation of one month u/s 144C(13)	30 days	29/12/2014
	Calendar month	30/12/2014
	Lunar month	28/12/2014
Date of AO pursuant to DRP directions	31/12/2014
Date of posting of AO by the department [CAgIT Vs Kappumalai Estate [1998]148CTR565(Ker)]	2/1/2015

Now suppose the learned assessing officer forwards the file to the Transfer Pricing Officer to  calculate the tax effect  as per the directions of the Hon'ble Dispute Resolution Panel , does he get to extend the period of limitation granted under section 144C(13)?

Once the transfer pricing officer passes an order u/s 92 CA, he becomes functus officio.AO does not have power to refer the case to the TPO once again after the DRP issues directions to the assessing officer.