TMI Blog2021 (10) TMI 791X X X X Extracts X X X X X X X X Extracts X X X X ..... R: This appeal filed by the assessee is directed against the assessment order dated 29.11.2016 passed by the A.O. for assessment year 2013-14 u/s 143(3) r.w.s. 144C of the Income-tax Act,1961 ['the Act' for short] in pursuance of directions given by Ld. Dispute Resolution Panel ( DRP ). The only issue urged by the assessee in this appeal relates to transfer pricing adjustment of ₹ 1,36,59,869/- made by the AO/TPO in respect of specified domestic transaction. 2. The assessee is engaged in the business of manufacture and processing of animal feed supplements. During the year under consideration, the assessee has entered into specified domestic transaction as detailed below: Sl.No. Name of the associated enterprises/related party Nature of specified domestic transaction Amount of specified domestic transaction 1 V.N. Plastics Pvt. Ltd. Purchase of Packing material 5,50,84,479 2 Pearl Products India Purchase of Packing material ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n examined by the Tribunal in the assessee s own case for assessment year 2015-16. The order passed in the above said case is extracted below: 4. At the outset, the Ld. A.R. submitted that the specified domestic transactions mentioned above was originally included in clause (i) of section 92BA of the Act. Hence, the assessee has filed transfer pricing study before the tax authorities and the TPO has also passed the impugned order by making TP adjustment. However, the above said clause (i) has been omitted by the Finance Act, 2017 w.e.f. 1.4.2017. The Ld. A.R. submitted that the legal effect of omission of clause (i) of section 92BA was examined by the coordinate bench in the case of Texport Overseas Pvt.Ltd. Vs. Deputy Commissioner of Income-tax in IT(TP)A No.1722/Bang/2017 dated 22.12.2017 and the coordinate bench held as under:- 7. Having carefully examined the orders of authorities below in the light of rival submissions and relevant provisions and various judicial pronouncements, we find that by virtue of the insertion of section 92BA on the statute as per clause (i), any expenditure in respect of which payment has been made or is to be made to person referred to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the currency of the Act will not apply to omission of a provision in an Act but only to repeal, omission being different from repeal as held in different cases. Following the aforesaid judgments, the jurisdictional High Court has also expressed the same view in the case of CIT Vs. GE Thermometrics India Pvt. Ltd. The relevant observation of the jurisdictional High Court is extracted hereunder: 8. Admittedly, in the instant case, there is no saving clause or provision introduced by way of an amendment while omitting sub-section (9) of Section 10B. Therefore, once the aforesaid section is omitted from the statute book, the result is it had never been passed and be considered as a law that never exists and therefore, when the assessment orders were passed in 2006, the AO was not justified in taking note of a provision which was not in the statute book and denying benefit to the assessee. The whole object of such omission is to extend the benefit under Section 10B of the Act irrespective of the fact whether during the period to which they are entitled to the benefit, the ownership continues with the original assessee or it is transferred to another person. Benefit is to the u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on to deal with the other issues on merit. Accordingly, appeal of the assessee stand allowed for statistical purposes. 5. The Ld. A.R. submitted that the above said decision rendered by coordinate bench has since been upheld by the High Court of Karnataka in the very same case of Texport Overseas Pvt. Ltd. in ITA No.392/2018 dated 12.12.2019. Accordingly, the Ld. A.R. submitted that the transfer pricing adjustment is liable to be deleted. When it was pointed out that the coordinate bench has restored the issue to the file of the A.O. for examining the payments in terms of section 40A(2) of the Act, the Ld. A.R. submitted that this issue may be restored to the file of the A.O. for examining it in accordance with the provisions of section 40A(2) of the Act. 6. The Ld. D.R., on the contrary, placed her reliance on the decision rendered by the Mumbai Bench of Tribunal in the case of Firemenich Aromatics India Pvt. Ltd. Vs. ACIT in ITA No.348/Mum/2014 dated 15.7.2020. The Ld. D.R. submitted that the Mumbai Bench of Tribunal has expressed the view that the decision rendered by Hon ble Apex Court in the case of Fiber Bores Pvt. Ltd. (2015) 52 Taxmann.com 135 and in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act or Regulation had not been passed. 6-A. Repeal of Act making textual amendment in Act or Regulation :- Where any [Central Act] or Regulation made after the commencement of this Act repeals any enactment by which the text of any [Central Act] or Regulation was amended by the express omission, insertion or substitution of any matter, then, unless a different intention appears, the repeal shall not affect the continuance of any such amendment made by the enactment so repealed and in operation at the time of such repeal. 24. Continuation of orders, etc., issued under enactments repealed and reenacted, . Where any (Central Act) or Regulation, is, after the commencement of this Act, repealed and re-enacted with or without modification, then, unless it is otherwise expressly provided any (appointment notification,) order, scheme, rule, form or bye-law, (made o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w provision. There is no real distinction between 'repeal' and an 'amendment'. As per the commentary on Principles of Statutory interpretation by Justice G.P. Singh, the legislative practice in India shows that omission of a provision is treated as amendment . (page 675, Chapter; Express Repeal ). Further Hon ble Supreme Court in Ekambrarappa Vs EPTO (AIR 1967 1541), held that amending Act which limits the area of operation of existing Act by modifying the extent clause, result in partial repeal of the Act in respect of the area which its operation is excluded ( emphasis and under lines are added by us). 17. Further, the Hon ble Supreme Court in the matter of Fibre Boards P. Ltd dated 11.08.2015 reported vide [(2015) 52 taxmann.com 135] /(2015) 10 SCC 333, as well as in the matter of M/s. Shree Bhagwati Steel Rolling Mills [CA No.4280 of 2007, dt.24.11.2015], reported vide (2016) 3 SCC 643, wherein the Hon ble Supreme Court in these two cases elaborately discussed the issue of repeal /omission/ amendment etc, and held that omission would amount to repeal . It is also held that there is no real distinction between an amendment and that amendment is i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 16. The Hon'ble Apex court in the case of Fibre Boards Pvt. Ltd and M/s. Shree Bhagwati Steel Rolling has doubted and disapproved its earlier decisions rendered in the case of Rayala Corporation (P) Ltd Vs Enforcement (1969) 2 SCR 412 and Kolhapur Cane Sugar Works Ltd Vs Union of India (2000) 2SCC536 and in the case of General Finance Company Vs CIT (2002) 7 SCC 1. Further, the Hon'ble Supreme Court in the case of Fibre Boards (I) Ltd, after referring to the provisions of Section 6A of the General Clauses Act held that a repeal can be by way of an express omission and that even an implied repeal of a statute would fall within the expression repeal in section 6 of the General clauses Act. Repeals may take any form and so long as a statute or part of it is obliterated, such obliteration would be covered by the expression repeal in section 6 of General clauses Act. Considering the latest decision of Hon ble Supreme Court in Fibre Board and Bhagwati Steel, the earlier decisions rendered by the Constitution Bench in Rayala Corporation (P) Ltd and Kolhapur Cansugar Works cannot be said to have laid down any ratio decidendi on an interpretation of the word repeal an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... well as the provisions of Section 6A of the General Clauses Act and thereafter the Court had held that the decision, in the matter of Rayala Corporation (supra) was per incurium. 19. In our humble view the Hon ble Supreme Court in Fibre Board (supra) and Bhagwati Steel Rolling (supra) have declared that the law in Rayala Corporation is per in curium, on the basis of which General Finance Co., (supra) was passed. Thus, the later judgments in Fibre Board (supra) and Bhagwati Steel Rolling (supra) shall have a binding precedent on all Courts in India including this Tribunal. 20. We may mention that the decision of the Hon ble Apex Court is declaration of law as per Article 141 of the Constitution of India. The law declared by Hon ble Apex Court in Fibre Boards (P) Ltd (supra) dated 11.08.2015, was available when the decisions was rendered by Bangalore Tribunal Textport Overseas Pvt Limited Vs DCIT (supra), however, the same was not brought to the notice of the bench. The coordinate bench while rendering the decision relied on the decision of Hon ble Apex Court in General Finance Co. Vs ACIT (supra), which was already declared as per-in curium. Similarly, the decision in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... completely as if it had never been passed, and the statute must be considered as a law that never existed. To this rule, an exception is engrafted by the provisions of Section 6(1), If a provision of a statute is unconditionally omitted without a saving clause in favour of pending proceedings, all actions must stop where the omission finds them, and if final relief has not been granted before the omission goes into effect, it cannot be granted afterwards. Savings of the. nature contained in Section 6 or in special Acts may modify the position. Thus the operation of repeal or deletion as to the future and the past largely depends on the savings applicable. In a case where a particular provision in a statute is omitted and in its place another provision dealing with the same contingency is introduced without a saving clause in favour of pending proceedings then it can be reasonably inferred that the intention of the legislature is that the pending proceedings shall not continue but fresh proceedings for the same purpose may be initiated under the new provision. 6. In fact coordinate bench under similar circumstances had examined the effect of omission of sub-section (9) to S ..... X X X X Extracts X X X X X X X X Extracts X X X X
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