TMI Blog2016 (9) TMI 1391X X X X Extracts X X X X X X X X Extracts X X X X ..... ingh (Judicial Member) And Prashant Maharishi (Accountant Member) For the Assessee : Ajay Vohra, Neeraj Jain, Deepika Agarwal For the Revenue : Kaushalendra Tiwari, Sr.DR ORDER Diva Singh (Judicial Member) The present appeal has been filed by the assessee assailing the correctness of the order dated 29.01.2016 of Assessing Officer passed under section 143(3) read with section 144C of the Income Tax Act, 1961 pertaining to 2011-12 assessment year on the following grounds:- 1. That the assessing officer erred on facts and in law in completing the assessment under section 144C read with section 143(3) of the Income-tax Act, 1961 ('the Act') at an income of ₹ 2,89,58,299 as against income of ₹ 39,43,589 returned by the appellant. 2. That the AO/TPO erred on facts and in law in making an addition of ₹ 2,44,78,815 allegedly on account of difference in the arm's length price of the 'international transactions' on the basis of the order passed under section 92CA(3) of the Act by the TPO. 2.1 That the DRP/AO erred on facts and in law in arbitrarily holding that the appellant is engaged in providing 'financial a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty transactions is not available in the annual report of the company and accordingly, not satisfying the filter of related party transactions applied by the TPO. 2.8. That the DRP/AO erred on facts and in law in not allowing appropriate risk adjustment to establish comparability on account of the appellant being a lowrisk-bearing captive service provider as opposed to the comparable companies who were independent comparable companies. 2.9 Without prejudice that the assessing officer/TPO erred on facts and in law in incorrectly computing the transfer pricing adjustment at ₹ 2,29,27,042 as against the correct adjustment of ₹ 1,95,41,928. 3. That the DRP/AO erred on facts and in law in disallowing an amount of ₹ 5,35,894 being interest on late deposit of TDS holding the same to be not an allowable expenditure. 4. That the assessing officer erred on facts and in law in levying interest under Section 234B of the Act. The appellant craves leave to add, amend, alter or vary, any of the aforesaid grounds of appeal before or at the time of hearing of the appeal. 2. Referring to the facts, qua the issues raised the Ld.AR stated that though he i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT vs Text Hundred India Pvt. Ltd. 239 CTR 263 (Delhi High Court); CIT Vs. Hewlett Packard India: 314 ITR 55 (Del HC); CIT Vs. Chandra Kant Sahu Bhai: 202 Taxman 262 (Del HC); CIT Vs. Betterways Finance: ITA 995 of 2009 (Del HC); Jatia Investment Co V. CIT: 206 ITR 718 (Cal Hon'ble HC); Electra (Jaipur) Ltd. Vs. IAC: 26 ITD 236 (Del ITAT); and Y.W.C. A of India Vs. IAC: 29 ITD 620 (Del ITAT). 3. The Ld. Sr. DR did not have any objection either to the admission of fresh evidence nor to the restoration of the issue back to the file of the TPO. His only argument was that the evidence is new and he would not want to address the same as first it should be looked into by the AO. 4. We have heard the rival submissions and perused the material available on record. It is seen that the prayer for fresh evidence and remand is not opposed by the Revenue. We find that though the TPO in para 1 and 3 of his order has extracted the activities as under:- 1. Taxpayer s profile Control Risk India Pvt. Ltd. the company is a 100% subsidiary of control risks group holding Ltd., London. During the financial year 2010-11, Control Risk India Private Limited for the purpose of business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions (c) Forensic accounting services (d) Asset tracing and recovery (e) Brand protection/ anti-counterfeiting consultancy (f) Political and security risk analysis Fraud Investigation Prevention 4.11. Control Risks provides tin' expert professional advice that companies need to withstand crises, and emerge stronger from the experience with better preventive measures. Service includes: a. Corporate Investigations b. Forensic accounting c. Litigation support d. Audio forensics e. Video forensics f. Court presentation g. Document capture h Crime scene reconstruction i. PDA analysis j. Mobile phone analysis k. Cell site analysis 4.12 Crisis and Security Consultancy These are further divided into: Security Management and Consultancy 4.13 No two organizational entities are alike and that a whole host of issues such as nature of their business, profile of employees and the geographical spread of their assets, uniquely determine their level of exposure. Further, company success is underpinned by its assets and protecting than in hostile and complex business environments is vit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se organizations. It is with this background that the functional similarity of comparable is required to be examined. 5. These facts set out in the TP study Report on the basis of Distribution and Sales Agreement entered into by the assessee and its AE have admittedly not been considered and the characterization based on past precedent by the TPO has been followed in haste. Accordingly considering the judicial precedent and the material available on record, in the light of the submissions of the parties before the Bench, we deem it appropriate to admit the fresh evidences filed. These evidences have been discussed in detail and are identical to what has been filed in TIA No.979/Del/2015 in order dated 27.09.2016. The evidences have been considered to be relevant and crucial for determining the issues as it elaborates and supports the original claims of the tax payer. Accordingly following the judicial precedent the evidences are admitted. Since the evidences have to be considered for the first time again following the precedent these are remitted to the TPO with the direction to pass a speaking order in accordance with law after giving the assessee a reasonable opportunity of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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