TMI Blog2018 (8) TMI 1196X X X X Extracts X X X X X X X X Extracts X X X X ..... ri P.V.S.S. Prasad For The Revenue : Shri K. Srinivas Reddy ORDER PER P. MADHAVI DEVI, J.M.: This appeal filed by the assessee is directed against the assessment order passed u/s 143(3) r.w.s. 144C of the I.T. Act, dated 03/10/2017 for AY 2013-14. The assessee has raised the following grounds of appeal: 1. The Ld. Dispute Resolution Panel (DRP)/Ld. Assessing Officer (AO) are erroneous in law and on the facts of the case. 2. The Ld. DRP/AO are not legally justified in making an adjustment of ₹ 2,20,99,958/- as profit attributable to the appellant company under the profit Split Method in connection with the absolute sale of intangible assets to AE when such revenue is generated by AE of the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relied upon the orders of revenue authorities. 4. Having regard to the rival submissions and material on record, we find that the assessee company, which is engaged in the business of providing animation services for television and film production companies from its in-house animation studio facilities in Hyderabad, filed its return of income for the relevant AY under both normal provisions and the MAT provisions of I.T. Act. During the course of assessment proceedings, AO noticed that assessee has entered into international transactions with its AE and, therefore, determination of Arm s Length Price of international transactions was referred to TPO, who considered the transactions and proposed an adjustment of ₹ 2,20,99,958/- towa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orders of the Tribunal for AYs 2011-12 and 2012-13. For the sake of convenience and ready reference, we reproduce the findings of the Tribunal in AY 2012-13 (ITA No. 441/Hyd/2017, order dated 12/01/2018) as under: 6. Having regard to the rival contentions and the material on record, we find that the issue involved is adjustment towards profit attributable to the assessee company in connection with sale of intangible assets by the assessee to its AE, DQ Entertainment (Ireland). The IPR was sold by the assessee to its AE in the earlier A.Ys and the ALP of the same had arisen for consideration in the A.Y 2010-11. The Coordinate Bench of the Tribunal at Para 15 of its order in ITA No.151/Hyd/2015, dated 22nd June, 2016 has held as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ungle book) to consider that there exists a international transaction. Once, the IP is sold and Arm's length price is determined, the IP becomes the property of AE . The assessee has no locus standi to claim any benefit neither the revenue. 15.2 The revenue has grievances on the arrangement and existences of group companies. There is no doubt, there exists tax planning. There can be tax planning within the four corners of the taxation laws. There is enough mechanism in the existing Act and also there is DTAA - arrangement with Ireland, which will take care of the situations of tax avoidance. The revenue has not brought any cogent evidence to prove that there exists any tax avoidance. In our considered view, the action of the TP ..... X X X X Extracts X X X X X X X X Extracts X X X X
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