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2019 (8) TMI 1853 - ITAT MUMBAITP adjustment - Payment for Global Information System (‘GIS’) Services - adjustment pertaining to GIS services, Payment for Multinational Client Co-ordination (‘MNC’) service, Payment for Management Service Fee (‘MSF’) services - HELD THAT:- We find that both the parties before us agreed that the issue in dispute is already addressed by this tribunal in assessee’s own case for the Asst Year 2010-11 [2019 (8) TMI 922 - ITAT MUMBAI] wherein it was held that duty of the ld. TPO is restricted only to the determination of the arm‟s length price of an international transaction between two related parties by applying any of the methods prescribed u/s.92C of the Act read with rule 10B of the rules. Thus, there is no provision made in the statute empowering ld. TPO for determining the ALP on a particular international transaction on an estimation basis / adhoc basis no hesitation in directing the ld. TPO to delete adjustment made to ALP in respect of aforesaid three services viz., GIS services, MSF Services and MNC Services. Addition of non-reconciliation on certain amounts reflected in Form 26AS with the return of income of the assessee - HELD THAT:- We find that the assessee had specifically mentioned before the ld DRP that the total of gross billings as per assessee’s records are more than the gross amounts reflected in the AIR report and also explained the reasons for the difference in a broad manner. We further find that the assessee had reconciled the differences in respect of all parties except to the tune of Rs 7 lacs (approx.) out of the total turnover of Rs 200 crores (approx.). We find that this issue was also addressed by the order of this tribunal in assessee’s own case for the Asst Year 2010-11 [2019 (8) TMI 922 - ITAT MUMBAI] held assessee was engaged as an Advocate to argue the matters by what is popularly known as Advocates on record or instructing Advocates method, meaning thereby the client does not engage the assessee directly but a professional or the Advocate engaged by the client requests the assessee to argue the case. The brief is then taken as the counsel brief. That being the practice, the assessee gave an explanation that the breakup as desired cannot be given and with regard to all payments. It is pointed out that at times, assessee receives fees directly from the clients or from the instructing Advocates or Chartered Accountants if such professionals have collected the amounts from the clients. The breakup as desired cannot be placed on record. An explanation which has been given by the assessee and accepted in the past has been now accepted by the Tribunal once again. Since it is accepted for the Assessment Year 200607, in the peculiar facts, in relation to the present assessee, we are of the view that this Appeal does not deserve to be entertained. - Decided in favour of assessee. Short grant of credit for tax deducted at source - We direct the ld AO to verify the same and decide the issue accordingly Chargeability of interest u/s.234D is consequential in nature. We also direct the ld. AO to verify whether at all any refund was actually granted to the assessee or adjusted with tax arrears with due intimation to the assessee before deciding the levy of interest u/s.234D of the Act. Adjustment towards assistance in brand building - HELD THAT:- As from documents clearly go to prove that the assessee’s receipt of assistance in brand building from Lowe Singapore is towards the services provided to its client HUL in the form of (i) disbursal of shortfall in assessee’s service fees identified as a part of reconciliation exercise for the Asia Pacific region and (ii) share of assessee in the incentive paid by the Unilever group at global / regional level. In addition to this service fees, we find that the assessee had also earned incentive from HUL at local level as well as from Unilever group at global / regional level which is disbursed by Lowe Singapore based on analysis of quantitative and qualitative parameters being achieved. We find that the payment from Lowe Singapore to assessee is only disbursal of assessee’s share in incentive provided by Unilever group to the Lowe group. Accordingly, the ld TPO’s contention that assessee should earn same level of incentive from Lowe Singapore by applying the CUP method is completely erroneous. Selection of comparables by the ld TPO - We find that the observations of ld DRP is factually incorrect and is not germane to the facts available on record. It is a fact that the assessee had not selected any comparables with regard to this issue in its TP study report. Hence the entire observations made by the ld DRP in this regard is factually incorrect and deserves to be dismissed. We also find that the transaction of ‘assistance in brand building’ was always there is earlier years and also in subsequent years. TPO had accepted the same to be at ALP in earlier and subsequent years. More importantly, the very same transaction was not subject matter of any adjustment in Asst Year 2013-14 which is also in appeal before us along with this appeal. There is absolutely no finding given by the ld DRP on this aspect of principle of consistency. We are inclined to accept the various arguments advanced by the ld AR and accordingly direct the ld TPO / ld AO to delete the adjustment made towards ‘Assistance in Brand Building’ - Accordingly, the Grounds 12 to 15 raised by the assessee for the Asst Year 2012-13 are allowed.
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