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Showing 101 to 120 of 1740 Records
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2019 (9) TMI 1646
Disallowance u/s 14A and Rule 8D(2)(i),(ii) & (iii) - sufficiency of own funds - HELD THAT:- We find that the assessee has own fund much above amount made investments in shares even by excluding the capital reserve and revaluation reserve. Therefore it is obvious that the entire investment made by the assessee of Rs.64,42,600/- is from its own interest free funds. In such situation, it will be incorrect to apply Rule 8D(2)(i) & (ii) of the Rules in the case of the assessee, because the assessee has not incurred any interest expenditure directly or indirectly with respect to its investment made for Rs.64,42,600/-. Therefore in the case of the assessee only Rule 8D(2)(iii) will be applicable and accordingly we hereby sustain the addition of Rs.32,213/- and further direct the Ld.A.O to delete the addition of Rs. 4,28,272/- (Rs.4,60,482 – Rs.32,213) made by applying the Rule 8D(2)(i) & (ii) of of the Rules.
Deemed Dividend u/s 2(22)(e) - business commitments of the assessee and its sister concerns - HELD THAT:- It is apparent that both the assessee and its sister company are dealers in automobiles of different nature and engaged in business with close proximity. The combined endurance to market the products in the same vicinity results in close commercial ties between the assessee company and its sister company. As a result both the companies were maintaining current accounts in order to achieve their respective business targets. Therefore it cannot be said that, the interdependence for meeting several business commitments of the assessee and its sister concerns does not result in commercial nexus between the assessee company and its sister concerns.
As pointed out by the Ld.AR some expenses were met by both the companies which were reimbursed by either company. These facts are not disputed. Moreover at the close of the financial year the current account maintained by the assessee with its sister concern showed nil balance. In this situation, we are of the view that the decision of the Jurisdictional High Court in the case CIT vs. C. Subba Reddy would be most appropriate, wherein it was held that “when no benefit has accrued to assessee and credit was a result of business transaction and was neither in nature of loan or deposit hence, provisions of Sections 2(22)(e) of the Act do not stand attracted.” Further in the case of the assessee the circular No.19/2017 supra is also very relevant. Considering these aspects of the case, we are of the considered view that provisions of Section 2(22)(e) of the Act will not be applicable in the case of the assessee. Therefore we hereby direct the Ld.AO to delete the addition made by invoking the provisions of Section 2(22)(e) - Decided in favour of assessee.
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2019 (9) TMI 1645
Issues Involved:
1. Assessment order passed by AO u/s. 143(3) r.w.s. 144C of the IT Act, 1961 for Assessment Year 2012-13 challenged by the assessee.
2. Correct interpretation of law and assessment of total income by the AO.
3. Transfer pricing adjustments made by the TPO and DRP.
4. Selection of comparables and economic analysis in transfer pricing.
5. Working capital adjustment benefit computation.
6. Risk profile adjustment and comparability analysis.
7. Surcharge rate levied by the AO and computation of education cess, secondary and higher education cess, and interest under section 234B.
8. Interest levied under section 234B and initiation of penalty proceedings u/s 271(1)(c) of the Act.
Detailed Analysis:
1. The appeal was filed against the assessment order passed by the AO for the Assessment Year 2012-13 under sections 143(3) and 144C of the IT Act, 1961 as per the directions of the DRP. The grounds raised by the assessee challenged the correctness of the interpretation of law by the AO and the assessment of the total income, including specific objections to the balance demand payable.
2. The transfer pricing adjustments made by the TPO were contested by the assessee, particularly focusing on the addition to the total income on account of adjustments to the arm's length price for Information Technology enabled Services transactions with associated enterprises. The economic analysis undertaken by the assessee was not accepted, leading to discrepancies in determining the arm's length price.
3. The selection of comparables and the conduct of fresh economic analysis by the AO, TPO, and DRP were challenged by the assessee. The use of FY 2011-12 data for determining the arm's length margin was criticized, along with the reliance on information obtained under Section 133(6) of the Act for comparability purposes.
4. Issues related to the computation of working capital adjustment benefit and the failure to make suitable adjustments for differences in the risk profile of the assessee compared to the comparables were raised. The incorrect computation of working capital adjustment and the lack of adjustments for risk profile differences were significant points of contention.
5. The imposition of surcharge at a higher rate, interest under section 234B, and the initiation of penalty proceedings under section 271(1)(c) of the Act were challenged by the assessee. The incorrect application of surcharge rate and interest computation were highlighted as errors in the assessment order.
6. The Tribunal, after considering the submissions and relevant case laws, partly allowed the appeal. It directed the AO to restrict the transfer pricing adjustment in respect of non-Denmark associated enterprises as per the Mutual Agreement Procedure (MAP) resolution applicable to Denmark AEs. The decision was based on precedents and upheld the assessee's contentions regarding the application of markup rates for transactions with non-Denmark AEs.
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2019 (9) TMI 1644
Exemption u/s. 11 & 12 - corpus donation - DR submitted that the CIT(A) ignored the fact that in the absence of written direction from the donor, the donation will not be treated as corpus donation and consequently, from part of the income of the organization - CIT(A) allowed the appeal of the assessee - HELD THAT:- CIT(A) has rightly observed that merely making an accounting entry does not change the substance of the transaction that the Corpus Fund has been utilized for the purchase of capital assets. Thus, there is no need to interfere with the findings of the CIT(A). The appeal of the revenue is dismissed.
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2019 (9) TMI 1643
Maintainability of Revenue appeal against the order of CIT(A) in deleting the additions - low tax effect - HELD THAT:- Undisputedly, the tax effect involved in appeal is less than the monetary limit prescribed by the recent CBDT Circular No.17/2019 [F.No.279/Misc.142/2007-ITJ (Pt)] dated 08th August, 2019 read with Circular No.3 of 2018 dated 11.07.2018 for filing of appeals before the Tribunal by the Department. The CBDT vide circular dated 08-08-2019 (supra) has amended Para 3 of Circular No.3 of 2018 dated 11-07-2018 thereby enhancing monetary limit of tax effect from ₹ 20 Lakhs to ₹ 50 Lakhs for filing of appeals by the Department before the Tribunal. Thus, without going into merit of the issues raised in the appeal, in view of the CBDT Circular (supra) the present appeal of the Revenue is dismissed on account of low tax effect. Appeal of revenue dismissed.
Deduction in respect of education cess - HELD THAT:- Allowability of the said cess as allowable deduction is decided in favour of the assessee by virtue of the Hon’ble Rajasthan High Court’s judgement in the case of Chambal Fertilisers And Chemicals Ltd[2018 (10) TMI 589 - RAJASTHAN HIGH COURT]
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2019 (9) TMI 1642
CENVAT Credit - inputs - Air & Rail Travel Agent Service - Courier Service - denial of Cenvat Credit Service on the ground that these services are not covered under definition of Input Service as provided under rule 2 (l) of the Cenvat Credit Rules, 2004 - HELD THAT:- The issue regarding the admissibility of Cenvat Credit in respect of Air & Rail Travel Agent Service and Courier service is no longer Res-Integra as covered by catena of judgments. This Tribunal has allowed the Cenvat credit in respect of said services used in relation to manufacture and clearances of the goods.
Reliance can be placed in the case of AKBAR TRAVELS OF INDIA PVT LTD VERSUS COMMISSIONER OF SERVICE TAX, MUMBAI-I [2018 (2) TMI 82 - CESTAT MUMBAI] and M/S. CREATIVE TRAVEL PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE & ST, NEW DELHI [2015 (10) TMI 1305 - CESTAT NEW DELHI]
In view of the settled position of law issue of admissibility of Cenvat Credit in respect of Air/Rail Travel Agent Service and Courier service is not under dispute, and the credit is admissible - appeal allowed - decided in favor of appellant.
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2019 (9) TMI 1641
CENVAT Credit - input services - Courier Service - demand of CENVAT Credit on the ground that whatever material was sent through Courier, there is no proof that the said goods have come back to the factory - HELD THAT:- The appellant claimed that the Courier Service was used for dispatch of office communication/documents and some time samples of Raw Material / Capital Goods for testing, repairs etc. Under the same set of facts this Tribunal has consistently taken a view that the Cenvat Credit in respect of Courier Service is admissible.
The case of the appellant is supported by judgments cited by them in the case of MODERN PETROFILS DTY DIV VERSUS C.C.E. & S.T. -VADODARA AND ASSOCIATED POWER STRUCTURES PVT LTD VERSUS C.C.E. & S.T. -VADODARA [2017 (9) TMI 206 - CESTAT AHMEDABAD] where it was held that the documents relating to technical expert's opinion, sample testing report, sending of samples, machine catalogue etc., are received and dispatched by utilizing the services of Courier and it cannot be said that these are de hors of the activities of manufacturing business.
Proof regarding return of the goods - HELD THAT:- It is not relevant as the issue involved is admissibility of Cenvat on Courier Service. The Courier Service was used in or in relation to manufacture and removal of goods. Therefore, the ground for denial that goods sent by Courier Service did not come back to the factory is not relevant.
Cenvat Credit is admissible - Appeal allowed - decided in favor of appellant.
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2019 (9) TMI 1640
Maintainability of appeal - low tax effect - HELD THAT:- Today, when the matter came up for consideration, the learned standing counsel for the Appellant submits that by virtue of the change of litigation policy notified by the Government as per the Circular bearing No. 17 of 2019 dated 08.08.2019, the amount in dispute does not cross the hurdle of minimum benchmark and in the said circumstance, the above appeal is sought to be withdrawn.
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2019 (9) TMI 1639
Wilful and deliberate violation of the order - initiation of contempt proceedings against Respondents - HELD THAT:- The order of the Appellate Tribunal has not been complied with by the Contemnors/Respondents ‘Prakash Kumar’ and ‘Usha Rani Jha’ and a prima facie case is made out for initiation of contempt proceedings against Respondents, therefore, ‘Prakash Kumar’ and ‘Usha Rani Jha’ (Contemnors/Respondents) are directed to remain present in the court before this Appellate Tribunal on the next date with their reply and state as to why contempt proceedings be not initiated against them for alleged wilful and deliberate violation of the order dated 20.02.2017 passed by this Appellate Tribunal in Company Appeal (AT) No. 31 of 2016.
Post the case ‘for admission (after notice)’ on 16th October, 2019 at 2.00 P.M. on the top of the list.
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2019 (9) TMI 1638
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - time limitation - HELD THAT:- When the matter was called on 28.08.2019 neither the Respondent (Corporate Debtor) nor a duly authorized representative was present. Under the circumstances when the respondent debtor remained absent; although opportunities were granted, the Bench had no option but to proceed as per the provision of Insolvency Code. Section 7 (4) the Insolvency Code has prescribed a time limit of 14 days. The Adjudicating Authority on receipt of application shall ascertain the existence of ‘default’ within 14 days and under Section 7 (5) on satisfaction that the ‘default’ had occurred, admit the application by passing an order. This procedure was duly followed and the order was passed. There was no irregularity hence the prayer for recalling such an order, which is valid in the eyes of law, deserves rejection. Otherwise also this Bench has no jurisdiction to review its own order.
The prayer for staying the operation of Insolvency is also not sustainable in the eyes of law. The applicant has not demonstrated any provision of the Insolvency Code under which the staying of Insolvency proceedings could be demanded. In the absence of any jurisdiction being not vested with NCLT Bench to stay the operation of Insolvency, this prayer as well, is hereby dismissed.
Application dismissed.
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2019 (9) TMI 1637
Interest u/s 244A - only contention raised that when the AO did not allow credit of TDS in A. Y. 2001-02 on this basis that corresponding income is not offered to tax in that year, the AO should have suo moto allowed credit of TDS in correct year - HELD THAT:- We find no merit in this claim because this not the case of the assessee that corresponding income was offered to tax in the same year in which TDS credit is claimed and the AO wrongly disallowed the claim of TDS credit. This is admitted position of fact that the assessee claimed TDS credit in A. Y. 2001-02 and offered corresponding income for tax in an earlier year and therefore, the delay in granting of refund is attributable to the assessee and as a consequence, interest u/s 244A is not allowable. In our considered opinion, if the TDS credit is claimed in a year in which corresponding income is not offered to tax, the AO has to disallow such claim of TDS credit in that year and it is not practically possible for the AO to allow such credit in the correct year in which corresponding income is offered to tax and it is for the assessee to point out the year in which such income is offered to tax and then the AO can allow credit of TDS in that year but in such case, delay in granting refund is attributable to the assessee and therefore, interest u/s 244A is not allowable. We therefore, decide this issue against the assessee in both years.
Allowability of depreciation on lease transactions - HELD THAT:- As decided in own case that the lease transaction is sham because the assessee on the one hand pays the value of machinery and at the same time receives the equivalent amount as deposit and thus, there is no out flow of fund so as to validly make payment for purchase price. It is seen that no difference in facts is pointed out in the present year or in any other year. When, the lease transaction itself is sham as per the earlier tribunal order in assessee’s own case under similar facts, no other argument or judgment cited in the written submissions reproduced above is required to be considered. Hence, we decline to interfere in the orders of the lower authorities on this issue in all years including the present year.
Amounts forfeited by the depositors in terms of the scheme approved by the High Court of Karnataka - This is by now a settled position of law that treatment in the books by the assessee is not decisive. This is also a settled position of law that taxability of a receipt cannot be on this basis that the assessee offered it for taxation. If a receipt is a capital receipt as held by Hon’ble Karnataka High Court in the judgment rendered in the case of Manipal [2014 (10) TMI 706 - KARNATAKA HIGH COURT] it cannot be taxed merely because the assessee treated it as revenue receipt or offered it for taxation. No other difference in fact is noted by CIT (A). Learned DR of the revenue also could not point out any other difference in facts. Hence, respectfully following this judgment of Hon’ble Karnataka High court, we decide this issue in favour of the assessee.
MAT credit in respect of MAT paid in earlier years - HELD THAT:- It is held by CIT (A) that there is no merit in this ground because the AO adopted the tax payable under regular provisions as it was more than MAT. As per written submission reproduced by CIT (A) on page 3 of his order, it is submitted by the learned AR of the assessee that this issue may not arise as on date but it may arise in future. Hence, it is seen that the assessee wants an advance decision. In the written submissions before us also as reproduced above, it is submitted that this ground has been raised as a matter of abundant precaution. Hence, it is seen that before us also, the assessee wants an advance decision. Hence, this ground is rejected.
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2019 (9) TMI 1636
Levy of Service tax - user development fee (UDF) - airport services - Build Own Operate Transfer scheme (BOOT) - rejection of refund claim - it was held that the following difference of opinion arising in this appeal needs to be referred to a 3rd member for resolving the issue: Whether user development fee charged by the appellant in the case in hand, is taxable under the Finance Act, 1994 under the head of airport services as held by the Hon’ble Member (Technical) or not to be taxed as held by the Hon’ble Member (Judicial)?
HELD THAT:- The appeal filed by the appellant is allowed with consequential relief.
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2019 (9) TMI 1635
Interference with the impugned order - ground of delay - HELD THAT:- The option is left to execute the order so passed by this Bench on 13.04.2017 and it required to be executed in the fashion as reflected in the order and accordingly, the fair value has been obtained by Independent Valuer which is in the record. Since, there is a difference in both the valuation, the Petitioner is agreed for mean value and if Respondent does not wish to purchase the share and asset of the company, in that event, the Petitioner is ready to go for the mean value and shall purchase the shares and assets of the company.
The prayer is allowed as a last chance as the matter is pending since 2017 - the Respondent is directed to either purchase the assets and properties as per mean value or allow the Petitioner to purchase the same, since no alternative left - List the matter on 10.10.2019.
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2019 (9) TMI 1634
Provisional attachment orders - factual error in making the recording, as if, a consent has been given when no such consent was given as recorded by the Tribunal - HELD THAT:- This Court made a suggestion on the last hearing on 23.09.2019 that the respondents will have to be directed not to alienate or encumber the property sought to be attached. Resultantly, the conditional order passed the Appellate Tribunal would go. The respondents are at liberty to maintain the properties sought to be attached to be used as a pathway.
For the aforesaid purpose, they can put temporary shed and make it useful, for which no equity has been claimed. Similarly, for maintaining the road, the expenses incurred cannot be fastened on the appellant. This arrangement would be subject to the disposal of the case pending on the file of the Special Court, Chennai, in S.C.No.74 of 2017. The respondents shall deposit a quantified amount, subject to the decision of the Special Court for the usage of the property.
All these arrangements are subject to the result of the adjudication in S.C.No.74 of 2017 by the Special Court, Chennai. The respondents shall pay a sum of ₹ 2 lakhs without prejudice to the contentions in the pending case. These arrangements also subject to the result in S.C.No.74 of 2017 on the file of the Special Court, Chennai.
The Special Court, viz.,the Principal Judge, City Civil Court, Chennai, shall dispose of S.C.No.74 of 2017 within a period of six months from the date of receipt of a copy of this order - Appeal disposed off.
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2019 (9) TMI 1633
Validity of criminal proceedings instituted against the petitioner for the offences under Sections 120B, 419, 466, 477-A of IPC - framing of charge under Sections 120B, 419, 466 & 477A of IPC - criminal conspiracy - applicant became the holder of locker by deletion of name of Mr. B.L. Agrawal and he was operating the same - Manipulation of bank documents - HELD THAT:- According to the evidence present in the charge-sheet, there is no such evidence and no such admission that any document was forged to incorporate the petitioner as the holder of the locker. On the contrary, there is evidence that anti dated application was filed in the bank and bank Officer obliged the client by making entries as desired by the parties. Further, the charge under Section 466 of IPC can be made only against the public servant or any person acting on his behalf. The petitioner is not the bank Officer. The evidence that the petitioner gave his signature for the operation of bank locker is not an act of forgery. Therefore, there is no evidence to substantiate the charge under Section 466 of IPC.
Similarly the person who can be prosecuted for commission of offence under Section 477A of IPC must be a clerk, officer or servant or employed or acting in that capacity and any private person cannot be prosecuted for the same. The prosecution case is this, that the bank documents have been manipulated and on the basis of admission made by the Bank Officer Mr. Antony Samy, it is clear that he received the application for deletion and addition of names and acted accordingly, as was prayed in the application. Therefore, there is no substance for prosecution of the petitioner under Section 477A of IPC - the material in the prosecution case left only to this extent that unaccounted money in cash form was found in the locker held by this applicant in locker No.240A of bank of Baroda, Raipur. The prosecution has traced its connection to Mr. B.L. Agrawal but as per the submission made by the counsel for petitioner, Mr. B.L. Agrawal has been exonerated by the Income Department. CBI has investigated this case subsequent to the raid conducted by the Income Department and have drawn conclusion for prosecuting this petitioner for the offences as aforementioned.
This Court after considering on the evidence present in the charge-sheet against this petitioner, has drawn its conclusion that there is no substance for prosecution of the petitioner for the offences for which he has been charge-sheeted - petition is allowed.
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2019 (9) TMI 1632
Interpretation of statute - Indian Penal Code - doctrine of harmonious construction - whether all the offences under Indian Penal Code are excluded in view of Section 3 of the Act or only the offences relating to the weights and measures as are contained in Chapter XIII Indian Penal Code alone stand excluded in view of Section 51 of the Act?
HELD THAT:- It cannot be disputed that the Act is a special Act vis-à-vis Indian Penal Code. In MACQUARIE BANK LIMITED VERSUS SHILPI CABLE TECHNOLOGIES LTD. [2017 (12) TMI 850 - SUPREME COURT], this Court adopted a doctrine of harmonious construction to hold that there was clear disharmony between the two parliamentary statutes which cannot be resolved by harmonious interpretation.
Section 3 of the Act completely overrides the provisions of Chapter XIII of Indian Penal Code in respect of the offences and penalties imposable for violations of the provisions of the Act, it being special Act. Therefore, if the offence is disclosed to be made out under the provisions of the Act, an Accused cannot be charged for the same offence under Chapter XIII of Indian Penal Code. Reading of Section 51 of the Act makes it clear that the provisions of Indian Penal Code insofar as they relate to offences with regard to weight or measure, shall not apply to any offence which is punishable under the Act. Therefore, the provisions of Indian Penal Code which relate to offences with regard to weight and measure as contained in Chapter XIII of Indian Penal Code alone will not apply. No person can be charged for an offence relating to weight or measure falling under Chapter XIII of Indian Penal Code in view of the provisions of the Act - the scheme of the Act is for the offences for use of weights and measures which are non-standard and for tampering with or altering any standards, secondary standards or working standards of any weight or measure. The Act does not foresee any offence relating to cheating as defined in Section 415 of Indian Penal Code or the offences Under Sections 467, 468 and 471 of Indian Penal Code. Similarly, an act performed in furtherance of a common intention disclosing an offence Under Section 34 is not covered by the provisions of the Act. An offence disclosing a criminal conspiracy to commit an offence which is punishable Under Section 120-B Indian Penal Code is also not an offence under the Act.
Since such offences are not punishable under the provisions of the Act, therefore, the prosecution for such offences could be maintained since the trial of such offences is not inconsistent with any of the provisions of the Act. Similar is the provision in respect of the offences Under Sections 467, 468, 471 Indian Penal Code as such offences are not covered by the provisions of the Act - appeal allowed in part.
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2019 (9) TMI 1631
Maintainability of appeal on low tax effect - HELD THAT:- DR though stated that it is not apparent from the present appeal as to whether the case of the assessee falls into any exception to the circular but at the same time, he was not able to demonstrate the exception applicable to the assessee, therefore, his arguments has no force. We find that the tax effect in this case is less than ₹ 50 lakhs, therefore, the appeal is not maintainable and therefore, we dismiss the same.
However, the parties are given the liberty to file for recalling of this order if the appeal is covered by the exceptions listed at para- 10 (scope of which stands widened vide amendment dated 20/08/2018) or para 11 of the order. Appeal of the Revenue is dismissed.
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2019 (9) TMI 1630
Violation of principles of natural justice - petitioner was denied an opportunity of hearing by the Identification Committee - Wilful Defaulter - HELD THAT:- In the facts of the present case, a Deputy General Manager issued the impugned show-cause notice dated May 25, 2016. The impugned show-cause notice does not have the decision of the Identification Committee in its entirety. Materials placed before the Identification Committee by the Bank do not find place in the impugned show-cause notice. The impugned show-cause notice is the understanding of the another of the show-cause notice of the decision of the Identification Committee. Such understanding cannot substitute the decision of the Identification Committee in its original form nor the materials placed by the Bank before the Identification Committee on which basis the Identification Committee arrived at its decision.
The petitioners were therefore deprived of the materials, which were before the Identification Committee and which the Identification Committee considered to recommend providing under the Master Circular on Wilful Defaulters dated July 1, 2015 against the delinquent. The petitioners, therefore, were denied an opportunity to meet the claim of the Bank in the proceeding.
The impugned action of the Bank taken under the Master Circular on Wilful Defaulters dated July 1, 2015 cannot be sustained - Petition allowed.
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2019 (9) TMI 1629
Seeking leave to appeal - Dishonor of Cheque - It was the respondent’s case that their accounts had been settled as he had returned certain products, which had been supplied to him and the credit for the same had not been accounted for - HELD THAT:- As per the books of the petitioner, a sum of ₹1,49,569/- was outstanding as on 11.10.2012. However, the petitioner waited for over two years to fill an amount of ₹2,00,000/- in the said blank cheque and deposited the same. According to the petitioner, the amount of ₹1,49,569/- had increased to ₹2,16,247/- as on the date of depositing the cheque, on account of interest calculated at the rate of 24% per annum - The trial court had noted that there was no contract or arrangement whereby the respondent had agreed to pay any interest.
The petitioner had been unable to establish that the cheque of ₹2,00,000/- had been issued by the respondent against any such liability. Even if it is accepted that the sum of ₹1,49,569/- was due from the respondent as on 11.10.2012, as deposed on behalf of the petitioner, the liability of ₹2,00,000/- was not established.
Petition dismissed.
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2019 (9) TMI 1628
Revision u/s 263 by CIT - unexplained cash credit u/s 68, interest disallowance treating it to be bogus and unexplained expenditure u/s 69C - HELD THAT:- It is noted that the issue involved in this case is no longer res integra in light of the decision of the Hon’ble Calcutta High Court in the case of CIT Vs Atha Mines Limited [2018 (12) TMI 1931 - CALCUTTA HIGH COURT]. In the decided case the Hon’ble High Court upheld the decision of this Tribunal allowing the claim of the assessee for set off of business loss of the current year against the income assessee u/s 68 in the same year. In this regard, we may also gainfully refer to the decision of this Tribunal in the case of DCIT vs M/s Atibir Hitech Pvt Ltd [2019 (3) TMI 1952 - ITAT KOLKATA]
As per the CBDT Circular No. 11/2019, we find that the order of AO on this issue cannot be termed as erroneous as well as prejudicial to the revenue. Therefore, we find that the show cause issued by the ld. Pr. CIT and the consequent order passed u/s 263 is legally unsustainable for want of jurisdiction and accordingly the same is hereby cancelled. - Decided in favour of assessee.
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2019 (9) TMI 1627
TP Adjustment - adjustment of AMP expenses - HELD THAT:- The issue relating to adjustment of AMP is covered by the decision of the Court in Sony Ericsson Indio Pvt. Ltd [2015 (3) TMI 580 - DELHI HIGH COURT] and Maruti Suzuki India Ltd. [2015 (12) TMI 634 - DELHI HIGH COURT]
We are of the considered opinion that the AI.P of an international transaction involving AMP expenses, the adjustment made by the TPO/DRP/AO is not sustainable in the eyes of law. At the same time, we cannot ignore the submission made by the learned DR that the matter is pending before Hon'ble Apex Court and the decision of Hon'ble Apex Court would be binding upon all the authorities. In view of the above, we set aside the orders of authorities below and restore the matter to the file of the Assessing Officer. We hold that as per the facts of the case and the legal position as of now and discussed above in this order, the adjustment made by the TPO/DRP/AO in respect of AMP expenses is not sustainable. However, if the above decisions of Hon'ble Jurisdictional High Court which is under consideration before the Hon'ble Apex Court is modified or reversed by the Hon'ble Apex Court, then the Assessing Officer would pass the order afresh considering the decision of Hon'ble Apex Court.
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