Strictures to AO's for not passing orders of DRP

Facts: Assessee, a non-resident had sold listed shares that were exempt under Section 10(38). AO passed an order under Section 144 read with Sections 147, 144C(1) by making an addition of Rs. 53.14 crores as unexplained money under Section 69A for having failed to explain the income reported in the AIR and non-filers monitoring systems (NMS). Before the DRP, assessee explained the erroneous stand of the AO who had counted the same transaction more than once thereby making the wrong addition under Section 69A. DRP instructed the AO to drop the additions. AO dropped the additions barring Rs. 26.56 crores disregarding the DRP instructions thereby travelling beyond the order of the DRP. On higher appeal by the assessee -

Held in favour of the assessee that the addition was unwarranted. The ITAT passed strictures against the AO for not following DRP orders which was against Section 144C(10) (which says DRP orders are binding on the AO). Further it instructed the department to take stringent actions against such AO's who do not adhere to orders of DRP.

Case: Oxbow Energy Solutions LLC, USA v. DCIT 2023 TaxPub(DT) 776 (Del-Trib)