9911796707
TMI Blog2015 (12) TMI 1779X X X X Extracts X X X X X X X X Extracts X X X X ..... Its main customers consist of Indians manufacturing tires, rice hulling rollers, footwear, mechanical rubber goods, in the rubber segment, and plant protection, feed, food, detergents, battery separators and toothpaste customers in the non-rubber segment. 2.3 Assessee has its independent agents and distributors which perform the sales and marketing function. Assessee pays commission to all its agents and distributors for the sales made by them. Degussa India Private Limited, another group company in India, coordinates with these agents and distributors and assists the Assessee in the Sales and marketing of its products in the domestic market and in countries like Bangladesh, Nepal and Sri Lanka. DIPL has it's headquarter in Mumbai and regional offices in Delhi, Mumbai, Chennai and Kolkata. 2.4 The assessee filed its return of income 02.11.2006 declaring the total income at Rs. 2,31,36,857/-. The case was selected for scrutiny. During the assessment proceedings, the assessing officer noticed that the assessee has entered into international transactions, and hence a reference was made to the TPO, u/s.92 CA(3). 2.5 During the year under consideration, the assessee undertook the fol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ALP of sales, made to AEs and made adjustment of Rs. 49,52,417/-. 2.12. Aggrieved by the order of the ld.TPO, the assessee filed its objections before the DRP. The DRP without going into other issues, upheld the order of the ld. TPO vide his order dated 30.09.2010. 2.13. The assessee preferred appeal before the Hon'ble Tribunal against the order of the DRP. The Tribunal at this stage observed that, the DRP had brushed aside the issues without proper consideration. The Tribunal vide order dated 08.06.2011, remanded the issue back to the DRP for de novo consideration of the issue. 2.14. The ld.DRP accordingly vide his order dated 26.02.2013, observed as under: "4. The assessee has explained, for the purpose of the arm's length analysis of the exports made to AEs, the assessee, selected TNMM as the most appropriate method and used internal margins earned from the export to non AEs for the comparability analysis and to determine the arm's length margin of its related party transactions. Facts on record indicated that assessee has made sale to AEs and non AEs. AE is located in Germany and non AE are in Malaysia, Sri Lanka, Vietnam. In view of DRP there is difference contractual ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o determine ALP, which was accepted by the Income Tax authorities in other year's assessment proceedings (i.e. for Assessment Years 2007-08, 2008-09 and 2009-10) and Hon'ble Commissioner of Income Tax (Appeals) proceedings (i.e. for AYs. 2003-04, 2004-05 and 2005-06) hence showing inconsistency with the already accepted position of the Appellant and Income Tax authorities. 6. That the ld. DRP has erred in not following the direction and observation of the Hon'ble Tribunal in the order passed in appeal for AY 2006-07 which had directed to pass a proper and speaking direction u/s 144C of the Act. 7. That the reference made to the ld. TPO by the ld. DRP and the additions/adjustments made are illegal and bad in law as the reference had already been made earlier to the ld. TPO and an order dated 20 October, 2009 u/s 92CA(3) of the Act was passed by making an adjustment of Rs. 4,952,417/- and subsequent rectification order dated 25 April 2011 u/s 92CA(3) of the Act reducing the adjustment to Rs. 36,11,840/- on account of difference in the arm's length price of the international transaction entered between Appellant and its AE's. 8. That the ld. DRP has failed to consider and adjudi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stablish the comparability of these two companies considered as comparable with the Appellant in the impugned order. 15. Without prejudice to our other grounds of appeal, the ld. TPO has erred in facts and circumstances by not accounting for material differences between the tested party and comparable companies. 16. Without prejudice to our other grounds of appeal, the ld. TPO has erred in law as per his impugned order dated 26 April 2013 by not applying the Proviso to section 92C of the Act thereby failed to allow the Appellant the benefit of 5% variation from the arm's length price. 17. That the Assessing Officer has incorrectly determined the taxable income of Rs. 5,93,44,313/- since the earlier demand of Rs. 49,52,417/- has been double counted, accordingly the demand of Rs. 1,66,69,750/- is also incorrectly determined. The appellant craves leave to submit such further grounds at or before the hearing of the appeal, so as to enable your Honour to decide the appeal according to law." 3.1 We have heard the rival contentions. On a careful consideration of the facts of the case, perusal of the papers on record and the orders of the authorities below, we find that the issue ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
