9911796707
TMI Blog2018 (6) TMI 1231X X X X Extracts X X X X X X X X Extracts X X X X ..... rised training centres to assist customers India operations of Microsoft licensed software. 3. During the financial year 2008-09 the assessee was engaged in providing marketing support to MS Corp and affiliated entities in return for a service fee and also provid software consulting services and other services. The international transactions of the assessee during the year with its Associated Enterprises (AEa) in respect of provision of marketing support services ("MSS") was of a value of Rs. 7,11,86,08,559/-. Assessee selected the Transactional Net Margin Method ("TNMM") as the Most Appropriate Method (MOM) for benchmarking of the international transaction for provision of MSS with a return on total operating cost ("OP/TC") as the Profit Level Indicator (PLI) and computed the PLI at 16.75%. PLI of fourteen comparables on the basis of multiple data was computed at 8.91%, and concluded that international transaction is at arm's length price. However, Ld. TPO, with reference to the Show cause notice and the submissions of the assessee, rejected five comparables stating that the assessee is providing high-end market support services to its parent AE. Finally Ld. TPO selected a set of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be disallowed being expenditure incurred for non-business purposes. 8. Ld. DRP recorded that the facts of this case are similar to the facts as in AY 2008-09 and for AY 2008-09 the Ld. DRP held that inasmuch as the issue was pending before the ITAT and has not reached finality, following the earlier year order declined to interfere with the order of the Ld. AO. By following the same, Ld. DRP declined to interfere with the order of the Ld. AO for this AY also. 9. It is brought to our notice that this issue is decided in favour of the assessee by the ITAT in respect of the assessment years 2006-07 vide order dated 18/12/2014 in ITA No. 5855/Del/2010, and for assessment year 2007-08 by order dated 30/06/2015 in ITA No. 5766/Del/2011. We have gone through the order dated 09/02/2016 in ITA No. 6417/Del/2012 for the assessment year 2008-09 wherein after referring to the orders relating to the earlier assessment years, the Tribunal reached the very same conclusion in favour of the assessee. Insofar as the continuity of these facts over the years is concerned, revenue does not dispute the same. When the facts continue to be similar, we do not find any reason to take a different view. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mistake of the automatically procedures reversaed the entire amount of Rs. 4,09,81,176/-thereby an additional amount of rupees Rs. 2,04,88,269/-was offered to tax erroneously, and to pass order in accordance with law. These grounds are, accordingly are restored to the file of the Ld. AO for the purpose of verification and passing orders a fresh. ITA No. 1206/Del/2014 14. As stated above, it is clear that the dispute in this appeal is confined to the benchmarking of 'Provision Of Market Support Services' (MSS) alone. Revenue is questioning the direction of the Ld. DRP to exclude M/s. Basiz Fund Services from the final set of comparables, stating that it is the result of nonexamination of the order of Ld. TPO and ignoring the detailed reasons given in such order. 15. It is the argument of the Ld. DR that the rejection of M/s. Basiz Fund Services by Ld. DRP on the ground of functional dissimilarity is incorrect and the Ld. DRP has changed the filter from broad functional comparability to stick to functional comparability and applied it only to one comparable. According to the Ld. DR the independent TP Auditor as well as the Ld. TPO selected the comparables from the entire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... okers, private equity funds in selected geographies, managed funds/portfolio accounts, family offices and internal fund accounting for which funds. Thus, it can be seen that the activities of M/s. Basiz Fund Services Private Limited and therefore, FAR are totally distinct and different from the FAR undertaken by MSS services provided by MCIPL. Ld. AR, therefore, prayed to reject the relief requested in department appeal number 1206/DEL/2014. 20. We have gone through the record in the light of the submissions on either side. During the financial year 2008-09 MCIPL continued to provide market support services. Transfer pricing study and the segmental financials extracted by TPO show that MSS was the major transaction. The assessee selected the transactional let margin method ("TNMM") as the most appropriate method for benchmarking of the international transaction for provision of marketing support services with a return on total operating caste ("OP/TC") as the profit level indicator and computed the PLI at 16.75% and computed the PLI of 14 comparables on the basis of multiple data at 8.91%. Ld. TPO has not rejected the transfer pricing study, but proceeded to modify the economic an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ones, as such Ld. DRP accepted the view taken for the earlier years and held for the assessment year 2008-09 that the services rendered by the assessee was not of high-end. It is not the case of the revenue that such a finding of fact was disturbed by any appellate authority. It is, therefore, clear that such a finding of fact has attained finality. Facts being continued similar for all these years, we deem it necessary that the revenue has to follow the consistent view taken in the earlier years. We, therefore, find that the appeal No. 1206/Del/2014 is devoid of merits and is liable to be dismissed. We accordingly dismiss the same. Cross objections. 24. It is submitted before us and we also find from order dated 28/03/2014 passed by the TPO, pursuant to the directions given by the DRP, that the entire addition by way adjustment originally proposed by TPO got deleted. Inasmuch as we uphold the directions of the DRP to delete M/s. Basiz Fund Services Private Limited, the order dated 28/03/2014 holds well. In these circumstances the grounds raised in the cross objections have become only academic. We, therefore, find it not necessary to delve deeper into the grounds of cross objec ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
