TMI Blog2021 (2) TMI 1358X X X X Extracts X X X X X X X X Extracts X X X X ..... e similar to as made for royalty payment to CAUSA, endorsed Ld. TPO's action. Since facts as well as reasoning of lower authorities are quite similar as in the case of royalty payment made by assessee to CAUSA, applying the same analogy, we delete the impugned addition. Disallowance of service fees paid to Cadbury Schweppes Asia Pacific Pvt. Ltd. - HELD THAT:- We notice from the records that the identical ground has already been decided [ 2019 (10) TMI 994 - ITAT MUMBAI] by the Coordinate Bench of ITAT in for AY 2008-09 in assessee s own case on merits in which ITAT has restored the matter back to the file of AO with direction to enable the revenue to take a consistent stand in the matter and also to follow the ITAT order for Assessment Year 2006-07. Disallowance of services fees paid to Cadbury Holdings Ltd. - HELD THAT:- We notice from the records that the identical ground has already been decided by the Coordinate Bench of ITAT in [ 2019 (10) TMI 994 - ITAT MUMBAI] for AY 2008-09 in assessee s own case on merits as held since facts as well as observations of lower authorities are parimateria the same as made by services fees paid by the assessee to CSAPL, taki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allocation of expenditure at Baddi Unit - HELD THAT:- We notice from the records that the identical ground has already been decided by the Coordinate Bench of ITAT in [ 2020 (2) TMI 1704 - ITAT MUMBAI] for AY 2007-08 in assessee s own case settled in favour of the assessee. We notice that the Coordinate Bench has accepted the method of allocation with regard to interest, VRS decrease in stock, direct expenses, direct marketing cost and selling distribution expenses, royalty and technical fees. The bench has remitted back to AO only the other overhead. Accordingly, we deem it fit to remit only the verification of allocation of other overhead to the file of AO. Therefore, we are inclined to accept the submission of Ld. AR. Accordingly, this ground raised by the assessee is partly allowed. Characterizing buyback of shares as distribution of dividend and levying dividend distribution tax on such buy back - HELD THAT:- We notice from the records that the identical ground has already been decided by the Coordinate Bench of ITAT in the case of Golden Sachs (India) Securities Pvt. Ltd. [ 2016 (3) TMI 118 - ITAT MUMBAI] hold that transaction in question would not fall under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... npur, Baddi and Bangalore and marketing branches at Delhi, Kolkata, Chennai and Mumbai. The GP disclosed during the year works out to 42.67% on a turnover of Rs. 1,824.38 crores as against the last year s corresponding figure of 42.84% on a turnover of Rs. 1,505.67 crores. The various issues involved in the assessment of the assessee were discussed in detail. 4. After considering the submission of the assessee, AO passed assessment order u/s 143(3) determining the total income of Rs. 1,94,37,06,345/- thereby making disallowances on various heads. 5. Further, the matter reached before Ld. DRP and Ld. DRP after considering the detailed submission of the assessee, uphold the action of AO vide order u/s 144C(5) of the Act 1961 6. Now before us, the assessee has preferred the appeal challenging the order of Ld. DRP on various grounds. Therefore, we are dealing issues ground-wise raised by assessee. Ground No. 1 - Transfer Pricing Adjustment s. 7. This ground is general in nature, thus requires no specific adjudication. Ground No. 2 to 7 Disallowance of payment of royalty on trademarks paid to Cadbury Schweppes Overseas Ltd, royalty on technology paid to Cadbury ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner (Appeals) has upheld the disallowance of royalty payment of trademark simply relying upon the order passed by him in assessee‟s own case for assessment year 2005 06. As could be seen from the material available on record, the assessee has entered into agreement with its current company in the year 1993, for availing technical knowhow for which it was required to pay royalty @ 2%. Subsequently, the assessee has entered into fresh agreements with the parent company for transfer of technical knowhow as well as use of trade mark for which assessee is required to pay royalty @ 1.25% and 1% of the net sales respectively. As could be seen from the materials placed on record, the payment of royalty for technical knowhow @ 1.25% has been approved by the Ministry of Commerce and Industry, Government of India, vide letter dated 14th September 2000 (copy is placed at Page 85 of the paper book). Similarly, payment of royalty for trademark @ 1% has been approved by the Reserve Bank of India, vide letter dated 25th June 2001, copy at Page 119 of the paper book. Thus, as could be seen, payment of royalty for trademark at 1% over and above the royalty paid at 1.25% for technical k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble from independent source to benchmark the transactions. 39. On going through the records and the orders of the revenue authorities, we find that in so far as the payment of royalty on technical knowhow concerned, the assessee has been paying to its parent AE right from 1993, as, other group companies are paying across the globe. It has been accepted by the TPO that the payment does not effect the profitability of the assessee, if we are to examine the issue from that angle as well. In any case the payment of royalty on technical knowhow is at par with the similar payments from the group companies in other countries region. Besides this, the payment is made as per the approval given by the RBI and SIA, Government of India. Hence there cannot be any scope of doubt that the royalty payment on technical knowhow is not at arm‟s length. 40. Coming to the issue of royalty payment on trademark usage, we find that the assessee, in fact is paying a lesser amount, if the payments are compared with the payments towards trademark usage, by the other group companies using the Brand Cadbury in other parts of the world. On the other hand, if we examine the argument taken by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of trademark and it does not provide for use of technical knowhow. It is the say of the Transfer Pricing Officer that since as per the Government guidelines, payment of royalty on trade mark under the automatic route is fixed at the maximum rate of 1%. Royalty paid for trademark at 2.7% is not at arm's length. Accordingly, he has allowed payment of royalty for trademark at 1%. While doing so, the Transfer Pricing Officer has also observed that the agreement executed in December 2007, amending the terms of the original agreement having come in to existence after expiry of relevant financial year would not be applicable for a transaction undertaken in the relevant financial year. The learned Commissioner (Appeals) has also endorsed the aforesaid view of the Transfer Pricing Officer. No doubt, on a perusal of the agreement dated 1st June 2006 between the assessee and CAUSA it appears that the said agreement has been termed as trademark license agreement. However, reading the agreement as a whole and more particularly, Clause 7(b) of the said agreement, it becomes clear the licensee (the assessee) shall manufacture licensed product using any technology of the licensor provided to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s have allowed payment of royalty both for trademark and technical knowhow, there is no reason why it should not be allowed in the impugned assessment year, since, it cannot be said that the assessee was manufacturing Halls‟ brand products without obtaining the required technical knowhow. Accordingly, we hold that payment of royalty to CAUSA is at arm‟s length. The ground is allowed. Respectfully following the same, we delete the impugned addition of Rs.87.61 Lacs. Ground No.4 stand allowed. With regard to disallowance of payment of royalty on on technology paid to Cadbury Enterprises Pvt. Ltd. 3.5.1 It was noted that the assessee entered into Technical collaboration Agreement dated 28/06/2007 with CEPT to avail the benefits of Technical Know-how, trade secrets etc. for mixed fruit flavored and strawberry flavored sugar non-coated center filled bubble gums / chewing gums. Another agreement was entered into with the same entity for Trademarks and copyright licenses in respect of products Bubbaloo, Bubba the Cat Adams. As per agreement, the assessee paid Technical royalty @4% and Trademark Royalty @1%. Applying the same reasoning, it was held that CEP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2008-09 in assessee s own case on merits in which ITAT has restored the matter back to the file of AO with direction to enable the revenue to take a consistent stand in the matter and also to follow the ITAT order for Assessment Year 2006-07. We draw strength from the following decisions in which matter cannot be remanded back when the TPO has failed to follow the prescribed method u/s 92C:- i) Kodak India Pvt. Ltd. (2013) 37 taxmann.com (Mum) ii) Barclays Bank PLC vrs. ADIT (90 taxmann.com 378) (Mum) iii) Vedanta Ltd. Vrs. PCIT (ITA 303/2018, C.M.Appl. 10257/2018). 15. For the sake of clarity, the decision of ITAT in the case of Kodak India Pvt. Ltd. is reproduced below:- I. Section 92B, read with section 92C, of the Income-tax Act, 1961 - Transfer pricing -Meaning of international transaction - Assessment year 2008-09 - Assessee, an Indian company sold its medical imaging business to 'C' Ltd. another Indian company for USD 13.543 million - Being domestic transaction, assessee returned its income, disclosing sale transaction as a normal domestic transaction - Assessing Officer found that sale transaction of imaging business by assessee to 'C&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid to Cadbury Holdings Ltd. 17. Before us, Ld. AR brought to our notice para 4.1 of TPO order and para 8.2 of DRP order and submitted that the similar issue has already been decided by the Coordinate Bench of ITAT in assessee s own case for Assessment Year : 2008-09 (ITA No. 7539/Mum/2012) on merits in favour of the assessee. 18. On the other hand, Ld. DR relied on the orders passed by revenue authorities, however he conceded that this ground is covered by the order of ITAT. 19. Considered the rival submission and material placed on record. We notice from the records that the identical ground has already been decided by the Coordinate Bench of ITAT in ITA No. 7539/Mum/2012 for AY 2008-09 in assessee s own case on merits. For the sake of clarity, which is reproduced below:- 3.7.1 In Ground Nos. 9 to 11, the assessee is similarly aggrieved by TP adjustment of Rs.207.02 Lacs stated to be paid as service fees to another AE viz. CHL. The assessee is stated to have received technical services from CHL which was similarly benchmarked using entity level TNMM. The Ld. TPO, on more or less same reasoning, reached a conclusion that the assessee failed to establish that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, it is outside the purview of international transaction as defined under section 92B of the ACT. As could be seen, the Transfer Pricing Officer ignoring the submissions made by the assessee had assumed that a benefit has accrued to the overseas A.E. on account of AMP expenditure incurred by the assessee. The learned Commissioner (Appeals) has upheld the adjustment / addition proposed by the Transfer Pricing Officer simply relying upon his order passed in assessee‟s own case for assessment year 2005 06. Notably, while deciding assessee‟s appeal for assessment year 2005 06 the Tribunal vide order passed in ITA no. 5470/Mum./2012, dated 18th May 2016, has decided the issue in favour of the assessee holding as under: 3.4. We have heard the rival submissions and perused the material before us. Before proceeding further,it would be useful to understand the philosophy and to consider the historical background of the TP provisions.It is said that the purpose and object of introduction of the provisions contained in Chapter X is to prevent an assessee from avoiding payment of tax by transferring income yielding assets to non-residents even while retaining the power to e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13.56 crores for the same period,that the TPO computed Rs.1.52 crores(1.78%) as the cost apportioned/allocable out of the A M cost incurred by the assessee for the benefit accruing to the AE,that he restricted the cost to Rs.71 lakhs(being0.87% of Rs.85.15crores)in view of the disallowance/ adjustment in income made on account of royalty for trade mark,that the average AMP expenditure by the leading FMCG companies for the period 2001-05 was 10.28%,that the AMP expenditure incurred by the assessee during the same period was 10.45%,that the assessee had contended that its profitability(PBT to sales ratio) @10.85%was much higher compared to the average profitability of the comparables at the rate of 3.57%,that the FAA had held that higher rate profitability could not be a justification of this proportionate expenditure, that in the appellate proceedings the FAA had proposed further addition,that finally he upheld the order of the TPO and confirmed the addition of Rs.71 lakhs,that there was no contractual obligation to recover money from the AE,that it was separately paying royalty for use of brand and trademark. There is no reason for not holding that the increased AMP expenditure led ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee.The TPO had ignored the fact that films/TV advertisements of the assessee had the local messaging concept.Such local advertisement campaigns can never be held to be driven towards serving the interests of the AE.It is also a fact that new multinational players in the industry had entered the Indian market.The commercial wisdom of any assessee,in such a situation,would compel it to be innovative and to spent reasonable expenditure for maintaining its position in the market.The TPO/FAA had not controverted the fact that the AE was the owner of intellectual property of the Cadbury‟brand and that it was responsible for promoting the brand all over the globe and that the brand related exercise at the cost of the AE for the overall brand positioning and management benefited the assessee also in an indirect manner.Nothing has been brought on record to prove that the assessee was directly or indirectly promoting the global brand rather than promoting its own products.In our opinion, there exists a fine but very important distinction between products promoted and nurtured by an assessee and the brand owned and supported by its AE.In the modern world both exist and play differen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... next step is to determine the price of such transaction. The third step would be to determine the ALP by applying one of the five price discovery methods specified in Section 92C. The fourth step would be to compare the price of the transaction that is shown to exist with that of the ALP and make the TP adjustment by substituting the ALP for the contract price. 55. Section 928 defines 'international transaction' as under: Meaning of international transaction. 928.(1) For the purposes of this section and sections 92,92C,92D and 92E , international transaction means a transaction between two or more associated enterprises, either or both of whom are nonresidents; in the nature of purchase, sale or lease of tangible or intangible property, or provision of services, or lending or borrowing money, or any other transaction having a bearing on the profits, income, losses or assets of such enterprises, and shall include a mutual agreement or arrangement between two or more associated enterprises for the allocation or apportionment of, or any contribution to, any cost. or expense incurred or to be incurred in connection with a benefit, service or facility provided or to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e party to the other would by itself constitute a transaction irrespective of whether the consideration for the same has been paid or remains payable or there is a mutual agreement to not charge any compensation for the service or benefit. This was negatived by the Court by pointing out; Even if the word 'transaction' is given its widest connotation, and need not involve any transfer of money or a written agreement as suggested by the Revenue, and even if resort is had to Section 92F (v), which defines 'transaction' to include 'arrangement', 'understanding' or 'action in concert', 'whether formal or in writing', it is still incumbent on the Revenue to show the existence of an 'understanding' or an 'arrangement' or 'action in concert' between MSIL and SMC as regards AMP spend for brand promotion. In other words, for both the 'means', part and the 'includes' part of Section 928 (1) what has to be definitely shown is the existence of transaction whereby MSIL has been obliged to incur AMP of a certain level for SMC for the purposes of promoting the brand of SMC. 59. In Whirlpool of India Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ake the adjustment of the difference in order to determine the value of such AMP expenditure incurred , for the AE. In any event, after the decision in Sony Ericsson (supre), -- the question of applying the BLT to determine the existence-of an-international transaction involving AMP expenditure does not arise. 61. There is merit in the contention of the Assessee that a distinction is required to be drawn between a 'function' and a 'transaction' and that every expenditure forming part of the function, cannot be construed as a 'transaction'. Further, theRevenue's attempt at re-characterising the AMP expenditure incurred as a transaction by itself when it has neither been identified as such by the Assessee or legislatively recognised in the Explanation to Section 92 B runs counter to legal position explained in CIT vs. EKL Appliances Ltd. (supra) which required a TPO to examine the 'international transaction' as he actually finds the same. 62. In the present case, the mere fact that B L, USA through B L, South Asia, Inc holds 99.9% of the share of the Assessee will not ipso facto lead to the conclusion that the mere increasing of AMP exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to shift from one jurisdiction to another.An 'assumed' price cannot form the reason for making an ALP adjustment. 71- Since a quantitative adjustment is not permissible for the purposes of a TP adjust - ment under Chapter X,equally it cannot be permitted in respect of AMP expenses either. As already noticed hereinbetore,what the Revenue has sought to do in the present. case is to resort to a quantitative adjustment by first determining whether the AMP spend of the Assessee onapplication of the BLT,is excessive,thereby evidenc - ing the existence of an international transaction involving the AE. The quantitative determination forms the very basis for the entire TP exercise in the present case. 74. The problem with the Revenue's approach is that it wants every instance of an AMP spend by an Indian entity which happens to use the brand of a foreign AE to be presumed to involve an international transaction. And this, notwithstanding that this is not one of the deemed international transactions listed under the Explanation to Section 928 of the Act.The problem does not stop here.Even if a transaction involving an AMP spend for a foreign AE is able to be located ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s position explicit. Therefore, where the existence of an international transaction involving AMP expense with an ascertainable price is- unable to be shown to exist, even if such price is nil, Chapter X provisions cannot be invoked to undertake a TP adjustment exercise. 65. As already mentioned, merely because there is an incidental benefit to the foreign AE, it cannot be said that the AMP expenses incurred by the Indian entity was for promoting the brand of the foreign AE. As mentioned-in- Sassoon -J David-(supra)- the--fact. that- somebody other than the Assessee is also benefitted by the expenditure should not come in the way of an expenditure being 'allowed by way of a deduction under Section 10 (2) (xv) of the Act (Indian Income Tax Act, 1922) if it satisfies otherwise the tests laid down by the law . Considering the facts-like absence of an agreement between the assessee and the AE.s.for sharing AMP expenses,payment made by the assessee under the head AMP to the domestic parties,failure of the TPO prove that expenses were not for the business carried out by the assessee in India-and following the judgments of the Hon‟ble Delhi High Court delivered in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led in favour of the assessee. Therefore, we are inclined to accept the submission of Ld. AR. Accordingly, these grounds raised by the assessee are allowed. Ground No. 25 Disallowance of depreciation on marketing know how. 25. Before us, Ld. AR brought to our notice para 5.1 to 5.4 of AO order and para 10 of DRP order and submitted that the similar issue has already been decided by the Coordinate Bench of ITAT in assessee s own case for Assessment Year : 2008-09 (ITA No. 7539/Mum/2012) on merits in favour of the assessee. 26. On the other hand, Ld. DR relied on the orders passed by revenue authorities, however he conceded that this ground is covered by the order of ITAT. 27. Considered the rival submission and material placed on record. We notice from the records that the identical ground has already been decided by the Coordinate Bench of ITAT in ITA No. 7539/Mum/2012 for AY 2008-09 in assessee s own case on merits. For the sake of clarity, which is reproduced below:- 4. The facts are that during previous year relevant to AY 2002-03, the assessee acquired on-going chocolate confectionary business of Warner Lambert (I) Pvt. Ltd. pursuant to the world-wide stoc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment proceedings, it transpired that the assessee earned exempt income of Rs.16.18 Crores which mainly comprised-off of dividend on mutual funds. The assessee, inter-alia, submitted that Rule 8D was not applicable to year under consideration. It was also submitted that assessee‟s surplus funds were invested in Liquid Mutual Fund and the same were withdrawn as per business requirements. The attention was also drawn to the fact there were two persons in the Treasury department to manage mutual funds investment on regular basis and the total salary paid to them was Rs.9.20 Lacs therefore, a part of the same could be disallowed. The arguments were also raised to submit that investments were made out of reserves and surplus. However, not satisfied, Ld. AO, applying Rule 8D, worked out aggregate disallowance of Rs.233.04 Lacs which comprised-off of direct disallowance u/r 8D(2)(i) for Rs.9.20 Lacs, interest disallowance u/r 8D(2)(ii) for Rs.80.56 Lacs and indirect expense disallowance u/r 8D(2)(iii) for Rs.143.28 Lacs. The direct expense disallowance u/r 8D(2)(i) for Rs.9.20 Lacs is the same disallowance which has been offered by the assessee against Treasury department expenses. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ancial parameters. Ground No. 14 stand partly allowed. 32. Therefore, respectfully following the above decision of Coordinate Bench in assessee s own case in turn relying on the decision of Assessment Year 2008-09. These issues are settled in favour of the assessee. Therefore, we are inclined to accept the submission of Ld. AR. Accordingly, these grounds raised by the assessee are allowed. Ground No. 27 Disallowance of foreign exchange loss . 33. Before us, Ld. AR brought to our notice para 7.1 to 7.11 of AO order and para 12 of DRP order and submitted that the similar issue has already been decided by the Coordinate Bench of ITAT in the case of London Star Diamond Co. (I) Pvt. Ltd. vrs. DCIT (2013) 38 taxmann.com 338 (Mum-Trib) on merits in favour of the assessee . 34. On the other hand, Ld. DR relied on the orders passed by revenue authorities, however he conceded that this ground is covered by the order of ITAT. 35. Considered the rival submission and material placed on record. We notice from the records that the identical ground has already been decided by the Coordinate Bench of ITAT in the case of London Star Diamond Co. (I) Pvt. Ltd. vrs. DCIT (2013) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h of ITAT in ITA No. 4225/Mum/2014 for AY 2007-08 in assessee s own case on merits. For the sake of clarity, which is reproduced below:- 30. Learned Counsel of the assessee submitted that the Assessing Officer has allocated following items to Baddi unit on the basis of sales ratio as under :- (i) Interest (ii) Operation and Establishment expenses (iii)Voluntary retirement expenses (iv) Decrease in stock 131. As regards decrease in stock, learned Counsel of the assessee submitted that this is actually change in inventory at Baddi unit and it is submitted that there is no question of any allocation of sales ratio. As regards voluntary retirement scheme expenses, learned counsel contended that Baddi unit was a new unit and none of the employee at Baddi unit has opted for VRS, hence he submitted that there cannot be any allocation. However, learned counsel agreed that for actually verifying this aspect this matter can be remitted to the file of the Assessing Officer. As regards interest expenditure learned counsel submitted that there are no financial charges attributable to Baddi Unit. He submitted that financial charges comprise majority of bill discount, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the net profit at Baddi unit is greater by approximately 10-12% than other units (after considering the CENVAT credit which is available only to other units). The cost of packing materials of chocolates is higher than packing materials for Bournvita since different types of wrappers are required for chocolates. The operation and establishment expenses are lesser at Baddi as compared to Warna due to the following reasons :- i) The Baddi factories are situated in backward areas and operation and establishment cost are comparatively lower as compared to Warna. ii) The factories located at other units are old. Hence, the operation and establishment expenses increase on year on year basis. iii) Further, Baddi unit enjoys a scale benefit since the production of Bournvita at Baddi unit is much higher than production of Bournvita in Warna. Therefore the unit fixed cost at Baddi is mower resulting in higher profit percentage. iii) Thus the ratio of establishment expenses has decreased due to increase in sales at Baddi factory leading to higher margin at Baddi unit. 32. Upon hearing both the counsel and perusing the record, we agree with the submissions of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cision, the issue may be remitted back to AO for verification of the facts. 41. In rejoinder, Ld. AR submitted that in the case of Fidelity Business Service (India) Pvt. Ltd, the ITAT has found that the purchase of buy back of shares are not genuine, whereas in the given case, the transaction is genuine, and accordingly the case of Fidelity is not applicable. 42. Considered the rival submission and material placed on record. We notice from the records that the identical ground has already been decided by the Coordinate Bench of ITAT in the case of Golden Sachs (India) Securities Pvt. Ltd. vrs. ITO (2016) 70 taxmann.com 46 (Mum Trib) and Hon ble High Court of Bombay in the case of Capgemini India Pvt. Ltd. (2016) 67 taxmann.com 1 (Bom) on merits. For the sake of clarity, ITAT order is reproduced below:- 5.3. We would also like to discuss the issue of the alleged colourability of the transaction. We find that in the matter of Capgemini India Private Limited(supra),the Hon‟ble Bombay High Court has deliberated upon the almost identical facts and circumstances and has held as under: 6. According to the Regional Director if the Scheme is sanctioned it will amount t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntitled to follow to buy back its shares. Following the above order,we hold that transaction in question would not fall under the category of colourable device.If an assessee enters into a deal which does not violate any provision of the Act of applicable to a particular AY.the deal cannot be termed a colourable device,if it result in non-payment or lesser payment of taxes in that year.The whole exercise should not lead to tax evasion.Non-payment of taxes by an assessee in given circumstances could be a moral or ethical issue.But,for that the assessee cannot be penalised.In light of the above discussion,we are reversing the decision of the FAA and deciding the effective ground of appeal in favour of the assessee. 43. Therefore, respectfully following the above decision of Coordinate Bench that the identical issue is settled in favour of the assessee. As submitted by Ld. AR, the case referred by Ld. DR to the case of M/s Fidelity Business is distinguishable to the facts of the present case. Therefore, we are inclined to accept the submission of Ld. AR. Accordingly, this ground raised by the assessee is allowed. Ground No. 30 Disallowance on account of Annual Informa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is no evidence to the contrary. Apparently, entire confusion has started from the fact that, perhaps as a measure of abundant caution, Vodafone deducted tax at source in respect of the vouchers etc and, for whatever reasons, stated, the name of distributor as collective recipient of entire sum. On these facts, in our considered view, learned CIT(A) was quite justified in deleting the impugned addition of Rs.58,78,256. We approve his conclusions, and decline to interfere in the matter. 47. Therefore, respectfully following the above decision of Coordinate Bench that the identical issue is settled in favour of the assessee and as submitted by Ld. AR, the assessee has declared the same in the subsequent assessment year, there is no loss as such to the revenue. Therefore, we are inclined to accept the submission of Ld. AR. Accordingly, this ground raised by the assessee is allowed. Ground No. 31 in respect of Short grant of TDS credit. 48. Considered the rival submission and material placed on record. We notice from the records that the Ld. AO has granted credit for TDS only to the extent of Rs. 1,69,04,517/- as Rs. 2,99,18,916/- against claimed in the return of income f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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