TMI Blog2022 (7) TMI 542X X X X Extracts X X X X X X X X Extracts X X X X ..... e period of limitation referred to in section 153 of the Act expires i.e. 31.10.2018. Hon'ble Madras High Court in case of M/s. Pfizer Healthcare India Pvt. Ltd. [ 2022 (4) TMI 808 - MADRAS HIGH COURT] while dealing with the issue held that for computing the period of 60 days, the last date as per section 153 should be excluded. Identical issue has been decided by the co-ordinate Bench of the Tribunal in case of ECL Finance Ltd. [ 2021 (9) TMI 1399 - ITAT MUMBAI] in favour of the assessee by following M/s. Pfizer Healthcare India Pvt. Ltd. (supra) Thus we are of the considered view that as per limitation prescribed under section 153 of the Act that assessment order was required to be passed within a period of 21 months from the end of assessment year i.e. A.Y. 2015-16 i.e. 31.03.2016, meaning thereby the assessment order under section 153(1) was to be completed within 21 months from the end of assessment year i.e. on 31.12.2017 with further extension of 12 months in case of transfer pricing reference as per section 153(4) of the Act was made which expires on 31.12.2018. So the limitation for passing the order under section 92CA(3) is 60 days prior to the date pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in law, the learned AO /Transfer Pricing Officer ('TPO'), based on the directions of the Hon'ble DRP has: General Ground 1. Erred in assessing the total income of the Appellant at Rs.24,35,50,65,077 against a total income of Rs.17,36,67,02,180 as computed by the Appellant in its return of income. A. Transfer Pricing grounds 2. Erred in making a reference of the Appellant's case to the learned TPO under Section 92CA(1) of the Act, without satisfying any of the conditions laid down in clauses (a) to (d) of Section 92C(3) of the Act based on the information / documents available with him; Separate segmental margins 3. Erred in law and facts, in upholding that the international transactions of the Appellant of rendering IT and BPO services under the Delivery Centre Agreement ('DCA') are two distinct transactions (i.e. rendering of IT services and rendering of BPO services) which should be benchmarked separately. Provision of IT services 4. Without prejudice to Ground No. 3 above, the learned TPO has erred in determining the arm's length range to be 20.95% to 24.88% (with a median of 22.91%) for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equired to be undertaken to account for the difference in working capital levels between the comparable companies and the Appellant. 14. Erred in not allowing the Appellant the benefit of the risk adjustment to account for the difference between the risks taken on by the Appellant and the risks taken on by the comparable companies Transaction of royalty payment 15. Erred in rejecting the economic analysis undertaken by the Appellant using CUP method for benchmarking the royalty payment to AE, and instead determining the arm's length price to be at 1% of revenue on an ad hoc basis without using any of the methods prescribed under Section 92C of the Act read with Rule 10B of the Income Tax Rules, 1962. 16. Erred in allowing royalty payment at an ad hoc rate of 1% only for use of brand name and trademark: disregarding the fact that the royalty paid by the Appellant is for the entire portfolio of IP which also includes tools, technology, methodology, etc. 17. Erred in rejecting all the external royalty agreements that were identified by the Appellant as comparables to determine the arm's length price under the CUP method, by giving ad hoc and arbitra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. The Ld. AO has erred in law in incorporating the TP adjustment proposed in the TP order which is invalid and bad in law into the Final Assessment Order passed under section 143(3) read with section 144C (13) of the Act. On the ground that additional ground sought to be raised is legal one which goes to the roots of the case affecting the jurisdiction of Ld. TPO to pass the order under section 92CA(3) of the Act. 3. The Ld. D.R. for the Revenue opposed raising of additional ground by the assessee on the ground that no such ground has been raised before the Lower Revenue Authorities. However, we are of the considered view that when additional ground sought to be raised by the assessee is a legal ground, which goes to the roots of the case and is also necessary to adjudicate the issue in controversy the same can be raised at any stage of the proceedings. Hence, additional ground raised by the assessee is allowed. 4. Briefly stated facts necessary for adjudication of the controversy at hand are : the assessee Accenture Solutions Pvt. Ltd. ( ASOL ) being the successor to the Accenture Services Pvt. LTd. (ASPL), is an Indian company engaged in providing Information T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th section 153 of the Act and consequent assessment order, to the extent of TP adjustment, is not sustainable and brought on record the factual position to calculate the period of limitation under the Act necessary to decide the issue in controversy in tabulated form which is as under: Particulars Relevant dates Assessment Year ('A.Y.') 2015-16 End of Assessment Year 31-03-2016 Due date for completion of assessment under section 153(1 ) i.e. 21 months from the end of A.Y. 31-12-2017 Extension of 12 months in case of transfer pricing reference as per section 153(4) of the Act 31-12-2018 Time Limit for passing the order under section 92CA(3A) i.e. 60 days prior to the date prescribed under section 153 Less: Date on which limitation expires under section 153 i.e. 31-12-2018 1 day Less: Remaining days of December 30 days Less: Number of days of November ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt in case of M/s. Pfizer Healthcare India Pvt. Ltd. (supra) while dealing with the issue held that for computing the period of 60 days, the last date as per section 153 should be excluded. Operative part of the judgment is extracted for ready perusal as under :- 30. Now, coming to the question of how the 60 day period is to be computed, the critical question would be whether the period of 60 days would be computed including the 31st of December or excluding it. Section 153 states that no order of assessment shall be made at any time after time expiry of 21 months from the end of the assessment year in which the income was first assessable. The submission of the revenue is to the effect that limitation expires only on 12 am of 01.01.2020. However, this would mean that an order of assessment can be passed at 12 am on 01.01.2020, whereas, in my view, such an order would be held to be barred by limitation as proceedings for assessment should be completed before 11.59.59 of 31.12.2019. The period of 21 months therefore, expires on 31.12.2019 that must stand excluded since Section 92CA(3A) states 'before 60 days prior to the date on which the period of limitation referred to S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of employees contribution on account of PF ESIC on the ground that the same were not deposited within the due date prescribed under the Act. However, this issue is now no longer res-integra as has been decided in favour of the assessee by the Hon ble Bombay High Court in case of CIT V. Ghatge Patil Transporters Ltd. 368 ITR 749 by confirming the order passed by the Tribunal that deduction claimed by the assessee on account of employees contribution to PF ESIC well before the due date of filing return of income is allowable deduction. 20. Hon ble High Court of Bombay in case of Ghatge Patil Transporters Ltd. (supra) held that both employees and employer s contribution are covered under amendment to section 43B and covered under judgment of Hon ble Supreme Court in case of CIT vs. Alom Extrusions Ltd. (2009) 319 ITR 306 and such deduction claimed by the assessee is allowable. 21. Co-ordinate Bench of the Tribunal in case of M/s. Adyar Ananda Bhavan Sweets India P. Ltd. vs. ACIT (supra) also decided the identical issue in favour of the assessee by holding that the payment of employees contribution qua PF ESIC if made before the due date of filing of return of income, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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