TMI Blog2018 (11) TMI 554X X X X Extracts X X X X X X X X Extracts X X X X ..... - In the course of the proceedings before the DRP the assessee had sought depreciation on the written down value of the market research expenses. As submitted by the assessee before the DRP that in the immediately preceding year i.e A.Y 2009-10 depreciation was allowed on the amount of the market research expenses of ₹ 23,50,000/- by treating the same as a capital asset. We find that the DRP observed that the claim of the assessee that it was allowed depreciation on the market research expenses in A.Y 2009-10 was in order. As DRP had directed the A.O to grant depreciation to the assessee on the market research expenses, after making necessary verifications on facts. However, we find that the A.O while framing the assessment had om ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore or at the time of hearing of the appeal. 3. The appellant prays that the order of the CIT(A) on the above ground be setaside and that of the assessing officer be restored. 2. Briefly stated, the assessee company which is engaged in the business of grading of diamonds, coloured stones, gems, pearls and other precious stones had filed its return of income for A.Y 2010-11 on 05.10.2010, declaring total loss of ₹ 6,21,29,504/-. Subsequently, the case of the assessee was selected for scrutiny assessment under Sec. 143(2) of the Act. 3. In the course of the assessment proceedings a reference under Sec. 92CA(1) was made to the Addl. CIT, Transfer Pricing Range 1(5), Mumbai (for short TPO ) on 23.11.2011 for determining t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t (for short APA ) with the Central Board of Direct Taxes (for short CBDT ) (Copy placed on record). The ld. A.R drew our attention to Appendix-1- Para 1(b)(ii) of the APA (Page 11-12 of the agreement). It was submitted by the ld. A.R, that as per the APA the international transaction for availing of Management Services by the assessee from its Associate Enterprise ( AE ) for the previous year 2009-10 was to be considered to be at arms length, if the payment made by the applicant in respect of such transaction during the said year did not exceed an amount of ₹ 8,22,38,141/-. The ld. A.R submitted that the assessee had as per the mandate of Sec. 92CD r.w Rule 10RA(2) filed the modified return of income for the rollback year u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of both the parties, perused the orders of the lower authorities and the APA, dated 07.05.2018. We find that the APA covers the year under consideration i.e previous year 2009-10 on the issue of determining of the arms length price of the management services availed by the assessee from its foreign AE during the year. As agreed upon amongst the authorised representatives of both the parties the present appeal of the revenue is treated as withdrawn, subject to verification of the facts on the part of the A.O. 8. The appeal of the revenue as observed by us hereinabove is dismissed as withdrawn. C.O No.112/Mum/2015 ( Arising from ITA No. 1558/Mum/2015) A.Y 2010-11 9. The assessee has raised before us the followin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he market research expenses. It was submitted by the assessee before the DRP that in the immediately preceding year i.e A.Y 2009-10 depreciation was allowed on the amount of the market research expenses of ₹ 23,50,000/- by treating the same as a capital asset. We find that the DRP observed that the claim of the assessee that it was allowed depreciation on the market research expenses in A.Y 2009-10 was in order. In the backdrop of the aforesaid facts the DRP had directed the A.O to grant depreciation to the assessee on the market research expenses, after making necessary verifications on facts. However, we find that the A.O while framing the assessment had omitted to give effect to the aforesaid direction of the DRP. We thus, in terms ..... X X X X Extracts X X X X X X X X Extracts X X X X
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