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The Ld A.R submitted that, as per the provisions of section 144C(10) of the Act, every direction issued by Ld DRP shall be binding upon the AO. Further, as per sec.144C(13), the assessing officer shall complete the assessment in conformity with the directions issued by Ld DRP. He submitted that the assessing officer, in the instantcase, did not pass the final assessment order in conformity with the directions issued by Ld DRP and hence the failure to follow the mandate of sec.144C(10) and 144C(13) would vitiate the assessment order and would make it illegal. He submitted that the assessing officer has rectified the final assessment order by passing a rectification order u/s 154 of the Act suo-motu. However, he has partially followed the directions issued by Ld DRP in the rectification order also, i.e., still he did not follow the direction issued in respect of belated payment of PF/ESI. He further submitted that the rectification order has been passed only on 6th February, 2017, which was beyond the prescribed time limit for passing the final assessment order. He submitted that the failure of the AO in not complying with the directions issued by Ld DRP cannot be considered to be an irregularity, which could be cured by passing the rectification order. Even otherwise, the rectification order complying with the directions of Ld DRP partially, has been passed beyond the time limit prescribed for passing the final assessment order and hence the same would not cure the illegality committed by the AO in passing the final assessment order.

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Sec. 154 of Income Tax Act, 1961— Rectification of Mistake —UNITED SPIRITS LIMITED vs. deputy CIT.[2020] 25 ITCD Online 073 (ITAT-BANGALORE)

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