TMI Blog2022 (5) TMI 1512X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue is hereby directed to allow depreciation @ 15% instead of 10%. - ITA No. 5597/Del/2018 ,ITA No. 5598/Del/2018 ,ITA No. 2019/Del/2019 - - - Dated:- 31-5-2022 - Sh. Amit Shukla, Judicial Member Dr. B. R. R. Kumar, Accountant Member For the Assessee : Sh. K. M. Gupta, Adv. Ms. Shruti Khimta, AR For the Revenue : Sh. Mrinal Kumar Das, Sr. DR ORDER Per Dr. B. R. R. Kumar, Accountant Member: The present appeals have been filed by the assessee against the orders of the ld. CIT(A)-44, New Delhi dated 29.06.2018 and 31.12.2018. 2. Since, the issues involved in all these appeals are identical, they were heard together and being adjudicated by a common order. 3. In ITA No. 5597/Del/2018, following g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estimate basis without regard for the need to apply the most appropriate method prescribed under Rule 10B of the Income-tax Rules, 1962 (the Rules ) 2.3. misinterpreting the guidance contained in the OECD Guidelines for Multinational - Enterprises and Tax Administrations in reaching the incorrect conclusions that the services provided were duplicative of services performed by the Appellant, created only incidental benefits to the Appellant, were of a generic and shareholder-nature, and cannot be calculated based on the use of allocation keys; and 2.4. basing its conclusions on incorrect statements of fact, such as that the cost of stewardship/shareholding activities had not been deducted in the calculation of the management fe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO for the year under consideration, the reference was also made to TPO under section 92CA(3) of the Act. During the course of TP assessment proceedings, the TPO held these management services of Rs. 1,97,41,500/-, value of international transaction excluding service tax to be in the nature of shareholder services and accordingly determined the value at Nil; thereby adding the management charges to the taxable, income of the appellant assessee vide TP Order dated 29.01.2014. The AO vide rectification order under Section 154 of the Act dated 11.02.2016 made a disallowance of Rs.2,17,74,875/- including service tax under section 40(a)(ia) of the Act for the same services and recomputed the income assessed under original assessment order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lable on record. 9. The Ld. CIT(A) disposed of the ground raised by the appellant assessee by holding that: 7.20 Moreover, section 40(a)(ia) and 92CA of the Act operate simultaneously in the case of any transaction and are not contradictory to each other. 10. The liability under section 40(a)(ia) of the Act arises where there is a failure on the part of the assessee to deduct the requisite tax at source (which is the case of the appellant assessee). Meaning thereby that, the deduction of such expenses sought by the assessee is liable to be added to the total income of the assessee. Similarly, for the same amount, the ALP was determined by the TPO as NIL which amounts to addition of such amount to the total income of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that Assessing Officer has made the double disallowance because, at the first instance he has proceeded with the income shown in the return of income Rs. 6,50,39,983/- which also included the amount of Rs.3,97,47,172/-and thereafter he made further addition of same amount under Transfer Pricing adjustment which assessee already had added/included as its income. Accordingly, we direct the AO to remove the double disallowance and grant consequential relief. Thus this ground is also treated as allowed. 14. If the interpretation sought to be taken by the AO/CIT(A) is accepted in the instant situation, then the assessee would be fastened with the liability to pay taxes on the same amount twice within the same assessment year. 15. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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