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2017 (3) TMI 1035 - AT - Income TaxTPA - ALP adjustment addition - Held that:- It is an admitted past history of the case that all the transactions have been considered together all along, except in the assessment year 2005-06 in which transactions of each month are taken togetherrather than transactions of the entire financial period, and in none of the earlier assessment years, the sale transactions have been considered on standalone basis. It is only in the present year, a departure has been made by the TPO in this regard. Whether transactions are so interrelated in relation to the same contract as to be taken together is essentially a factual aspect permeating over the different years, and, as observed by Hon’ble Supreme Court in the case of Radhasoami Satsang Vs CIT [1991 (11) TMI 2 - SUPREME Court ], “ each assessment year being a unit, what is decided in one year may not apply in the following year but where a fundamental aspect permeating through the different assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent year”. In this view of the matter, there is no good reason to take a different stand now and claim that aggregation of transactions cannot be permitted in this assessment year, so far as benchmarking of ANH sales to AE is concerned. The plea of the assessee is indeed well taken and it merits our acceptance. We have also noted that there is no dispute that once this principle is adopted, the benchmarking done of the assessee is to be accepted and the transactions are to be held as arm’s length transactions. The assessee, therefore, deserves to succeed on this issue. Section 35(2AB) weighted deduction denied - Held that:- The assessee at this stage raises an alternative submission as extracted herein above that authorities below ought to have held it eligible for section 35(1)(iv) deduction. We notice that the learned DRP has not considered the said argument in paragraph no.15.11 hereinabove. It merely holds that section 35(2) of the Act bars the impugned deduction pertaining to expenditure incurred on purchase of land etc. It however does not specifically pinpoint as to what was the expenditure incurred head-wise so as to be hit by the above bar in granting the impugned deduction. We thus deem it fit and proper to remit the issue back to the Assessing Officer for adjudication afresh as per law after examining necessary details stated in assessee’s books of account after affording it adequate opportunity of hearing. This ground is partly accepted for both the assessment years, in the terms indicated hereinabove. Disallowing employees’ contribution to P.F. on belated payment thereof - Held that:- Learned counsel filed before us Hon’ble jurisdictional High Court’s decision in CIT vs. Amoli Organics (P.) Limited [2013 (11) TMI 971 - GUJARAT HIGH COURT] holding that if the assessee has deposited the above contributions within the grace period, the impugned disallowance is not sustainable. Revenue fails to rebut this legal position. We thus remit the issue back to the file of the Assessing officer for factual verification and allow the impugned contribution to the extent that has been deposited within the stipulated grace period. This ground of assessee’s appeal succeeds for statistical purposes. Repair and replacement expenses of its building’s roof holdings disallowed - Held that:- Assessee has in fact incurred the impugned sums on plant building’s roof repair. The authorities below have taken strong cognizance to the effect that it has itself estimated benefits of above repairs to continue for a period of four years. We find this approach to be wholly unreasonable since this is not the lower authorities’ case that the assessee’s repairs in question have in any manner added any structure or asset of permanent nature conferring it an enduring benefit. We further find in the case of Taparia Tools Limited vs. JCIT (2015 (3) TMI 853 - SUPREME COURT ) has accepted a similar proposition that allowability of revenue expenditure claim cannot be denied merely on the ground that the same has been amortized or claimed for over a period of years. We accordingly accept assessee’s corresponding substantive ground and direct the Assessing Officer to delete the impugned disallowance Disallowance of holding stores and spares as treated as capital expenditure - Held that:- It has already come on record that the Assessing Officer himself has accepted assessee’s action having amortized similar expenses in the immediately preceding assessment year 2005-06. Learned Departmental Representative at this stage points out the the impugned expenditure was incurred in preceding assessment year and therefore the same is not allowable in the instant assessment year. We observe in these peculiar facts that our above discussion in preceding paras relying on the case law of Taparia Tools Limited (supra) applies herein as well since there is no material in the case records to indicate any addition in assets resulting in enduring benefits. We further place reliance on Union of India vs. Azadi Bacho Andolan (2003 (10) TMI 5 - SUPREME Court ) to follow judicial consistency to conclude that once the Assessing Officer accepted similar claim in the preceding assessment year, he ought not to reject apportion of the said claim in the instant assessment year. We thus accept assessee’s instant substantive ground as well.
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