Final IT assessment order time-barred u/s 144C(13) — ITAT (Microsoft India)

The ITAT (Delhi bench) quashed a ₹549 crore tax demand against Microsoft India by holding the final assessment order invalid as it was issued beyond the statutory time-limit under section 144C(13) of the Income-tax Act. The Tribunal reaffirmed the strictness of limitation provisions: an assessment order passed after the prescribed period is void ab initio, regardless of the merits of the underlying adjustments. The decision emphasises due process protections in tax administration and demonstrates that procedural lapses can vitiate large assessments. For taxpayers, the ruling is a strong reminder to vigilantly monitor statutory timetables, preserve records of communications and draft orders, and challenge time-barred proceedings promptly. Revenue authorities must ensure adherence to statutory timelines in appeals and reassessments to prevent loss of recoverable dues. This case is particularly significant for large MNEs facing complex scrutiny — procedural compliance can decisively determine outcome.