TMI Blog2016 (7) TMI 242X X X X Extracts X X X X X X X X Extracts X X X X ..... le back to TPO for deciding the issue afresh by passing speaking order. The TPO shall decide the issue after considering the facts of the case, documents on record and in the light of decisions of Tribunal. The appeal of the Department for the assessment year 2008-09 is accordingly allowed for statistical purpose. - ITA No. 1797/PN/2013, ITA Nos. 1973 & 1974/PN/2013 - - - Dated:- 18-4-2016 - SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM For The Assessee : Shri Milin K. Mehta For The Revenue : Shri Subhash Chandra ORDER PER VIKAS AWASTHY, JM : ITA Nos. 1973 1974/PN/2013 have been filed by the Revenue against the order of Commissioner of Income Tax (Appeals)-IT/TP, Pune dated 19-08-2013 common for the assessment years 2008-09 and 2009-10. The assessee has filed cross appeal in ITA No. 1797/PN/2013 for the assessment year 2009-10. 2. The brief facts of the case as emanating from the records are: The assessee is a 100% subsidiary of Schaeffler KG Germany. The assessee is engaged in the manufacturing of roller bearings, linear guides bearings systems and engine components for various automobile companies. During the impugned assessment years the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Payment of interest 5,54,00,324 CUP Libor + 0.455 Receipt of loan 9,59,36,000 CUP Libor + 0.455 Payment for services-product development, Technical and management support 4,09,79,999 Cost plus 5% Payment of charges for SAP software and IT costs 1,52,22,396 Cost plus 5% Reimbursement of expenses paid 3,26,15,978 Actuals Reimbursement of expenses received 49,950 Actuals Total 1,61,33,11,882 Since, there were huge international transactions with AE in the impugned assessment years, the Assessing Officer referred the same to Transfer Pricing Officer (TPO) for verification of correctness or otherwise of ALP of these transactions. The TPO vide order dated 28-10-2011 rejected the benchmarking of international transactions done by the assessee with its AE and made upward adjustment of ₹ 19,97,51 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Shri Milin K. Mehta appearing on behalf of the assessee vehemently supported the findings of Commissioner of Income Tax (Appeals) in granting adjustment on account of capacity under utilization. The ld. AR submitted that the capacity utilization in the case of assessee was 35.42% whereas capacity utilization in case of comparable company was 81.63%. To substantiate his claim the ld. AR referred to page 459 of the paper book. The ld. AR contended that the assessee had undertaken substantial expansion program which resulted in under utilization of capacity. The TPO after verifying these facts allowed adjustment for capacity utilization in assessment year 2009-10. The Commissioner of Income Tax (Appeals) approved the findings of TPO and granted the benefit of under utilization of capacity in assessment year 2008-09 on similar grounds. The ld. AR in support of his submissions relating to allowability of under capacity utilization adjustment placed reliance on the following decisions: i. Amdocs Business Services Pvt. Ltd. Vs. DIT in ITA No. 1412/PN/2011 for the assessment year 2007-08 decided on 23- 07-2012. ii. Ariston Thermo India Ltd. Vs. DCIT in ITA No. 1455/PN/2010; iii ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he capacity under utilization on the basis of the order of TPO passed in the subsequent assessment year i.e. assessment year 2009-10. It is an undisputed fact that the benefit of under capacity utilization has been granted by the Tribunal in various cases wherever the assessee deserves or where the facts and circumstances of the case warrants so. In the present case, it is not clearly emerging from the records as to on what basis under capacity utilization adjustment is to be granted to the assessee. Therefore, we deem it appropriate to remit the file back to TPO for deciding the issue afresh by passing speaking order. The TPO shall decide the issue after considering the facts of the case, documents on record and in the light of decisions of Tribunal. The appeal of the Department for the assessment year 2008-09 is accordingly allowed for statistical purpose. ITA Nos. 1797 1974/PN/2013 (A.Y. 2009-10) 7. The ld. AR of the assessee has submitted that the Commissioner of Income Tax (Appeals) has passed the impugned order for the assessment year 2009-10 without considering the written submissions filed by the assessee. A perusal of impugned order shows that the Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X
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