Final Assessment Order Quashed as Beyond Limitation: Key Takeaways from ITAT Delhi in Triumph Motorcycles (India) Pvt. Ltd.

Background of the Dispute

The Delhi Bench of the ITAT, in the case of Triumph Motorcycles (India) Pvt. Ltd. Vs Additional/Joint/Deputy/ACIT, examined whether a final assessment framed under Section 143(3) read with Section 144C(13) and Section 144B for AY 2017-18 was within the statutory time limit prescribed by Section 153.

The assessee assailed the final assessment order dated 26.02.2022, contending that it was issued after the expiry of the outer limitation period mandated under Section 153(1) read with Section 153(4) of the Income Tax Act 1961. The central legal question was whether the non-obstante clause in Section 144C(13) overrides the limitation framework under Section 153, or whether both provisions must be read harmoniously.

Additional Ground on Limitation

Assessee’s Contention

The assessee raised an additional legal ground asserting that:

  • The final order dated 26.02.2022 was passed beyond the time permitted under Section 153(1) read with Section 153(4).
  • Consequently, the assessment was time-barred, invalid in law, and liable to be quashed as void ab initio.

To support this, the assessee relied heavily on:

  • The judgment of the Madras High Court in Commissioner of Income-tax Vs. Roca Bathroom Products (P.) Ltd. [2022] 445 ITR 537 (Madras); and
  • Multiple decisions of the Hyderabad Bench of the ITAT which had already followed Roca Bathroom Products while deciding similar limitation disputes.

Revenue’s Objection and Request for Deferral

The Department, through its representative, opposed immediate adjudication of the limitation issue and argued:

  • The interplay between Section 144C and Section 153 is presently sub judice before the Supreme Court in ACIT Vs. Shelf Drilling Ron Tappmeyer Ltd. (SLP (C) Nos. 20569-20572/2023).
  • Since the Supreme Court has already referred this issue to a Larger Bench after a split verdict, the Tribunal should defer deciding the limitation point in the present appeal.
  • It was submitted that the Tribunal should not proceed solely on the basis of the Madras High Court ruling in Roca Bathroom Products (P) Ltd., given the pendency of the question before the apex court.

The Department filed detailed written submissions reiterating its plea for adjournment of the limitation issue and the entire appeal.

Reference to Earlier Coordinate Bench Decision

The Delhi Bench noted that identical arguments had recently been considered and rejected in Teva Pharmaceutical & Chemical Industries India Private Limited Vs Assessment Unit, Income Tax Department/DCIT (ITA No. 4197/Del/2024, order dated 19.01.2026).

In that case, after examining the Revenue’s preliminary objection and reliance on the pending Shelf Drilling matter, the coordinate bench had held that:

  • There was no bar on the Tribunal deciding appeals involving the same legal issue, despite the pendency of the matter before the Supreme Court.
  • The assessee in that matter had not relied on the Bombay High Court decision in Shelf Drilling Ron Tappmeyer Ltd., which was the subject of the Supreme Court interim direction.
  • Instead, reliance was placed on the Madras High Court’s decision in Roca Bathroom Products (P) Ltd., on which no stay was in operation.

Effect of Supreme Court’s Interim Order in Shelf Drilling

The Tribunal in Teva noted:

  • The Supreme Court, by interim order dated 22.09.2023, had only directed that the Bombay High Court judgment in Shelf Drilling Ron Tappmeyer Ltd. should not be cited as a precedent pending further orders.
  • Subsequently, on 08.08.2025, a split verdict was delivered by a two-judge bench of the Supreme Court, and the matter was referred to the Hon’ble Chief Justice of India for constitution of a Larger Bench.
  • Crucially, this interim arrangement did not restrain reliance on the Madras High Court’s ruling in Roca Bathroom Products (P) Ltd.

Thus, the Tribunal observed that the assessee’s reliance on Roca Bathroom Products remained unaffected by the Supreme Court’s directions in Shelf Drilling.

Statutory Mechanism Under Section 158AB

Why Deferral Was Rejected

The Revenue argued that adjudicating such appeals before the Supreme Court’s final verdict would lead to unnecessary multiplicity of proceedings.