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TMI Blog2024 (6) TMI 977X X X X Extracts X X X X X X X X Extracts X X X X ..... TP) A No.10/Chny/2023, are re-produced as under: I. GENERAL GROUND I.1. The lower authorities erred in passing orders which suffer from legal defects such as being passed in violation of principles of natural justice and the provisions of the Income Tax Act, 1961 ("the Act") and is devoid of merits and are contrary to facts on record and applicable law and has been completed without adequate inquiries and as such is liable to be quashed. II. JURISDICTIONAL GROUNDS 2. Validity of directions issued by the Ld. Dispute Resolution Panel 2.1. The directions issued by the Ld. Dispute Resolution Panel under section i44C(5) of the Act, is invalid and void-ab-initio on account of not containing the mandatory system-generated Document Identification Number ("DIN") on the body the said directions, in contravention to Circular No.19 of 2019 issued by the Central Board of Direct Taxes, and is therefore liable to be quashed and held as never to have been issued. 3. Validity of the final assessment order 3.1. The final assessment order dated January 02, 2023 ("Impugned Order"), passed pursuant to the invalid directions issued under section 144C(5) of the Act, is illegal, bad in law, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd in law, in not considering the detailed submissions on break-up of advertisement, marketing and sales promotion expenses and having adopted an arbitrary approach of treating an ad-hoc amount of INR 483.24 Crores towards promotion of the AE's brand. Further, the Ld. TPO erred in arbitrarily concluding that 50% of the advantage of the alleged brand building ensued to the Appellant's AE and that the same is to be recovered with a mark-up. IV. GROUNDS ON MERITS - CORPORATE TAX 5. Disallowance of payments in relation to expatriates 5.1. The lower authorities erred on the facts and circumstances of the case and in law, in disallowing the payments made by the Appellant, to Renault Nissan Global Management S.A. ("RNGM") ("impugned payment"), amounting to INR 7.50 Crores under section 4o(a)(i)of the Act. 5.2. The lower authorities failed to appreciate that disallowance under section 4o(a)(i) of the Act is not sustainable in relation to the portion of the impugned payment pertaining to management fee, on which taxes were duly withheld by the Appellant under section 195 of the Act, which was also accepted by the Ld. AO in the remand report. Therefore, the disallowance under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has filed its return of income for AY 2017-18 on 30.11.2017 admitting total income of Rs.NIL. The assessee had also filed return of income for AY 2018-19 on 28.11.2018 admitting total income of Rs.NIL. The assessments for both assessment years, have been taken up for scrutiny and during the course of assessment proceedings, the AO noticed that the assessee had entered into international transactions with its Associated Enterprises (in short "AEs") for both assessment years towards purchase of traded goods, sale of traded goods, purchase of capital goods, interest on ECB loan, etc. Therefore, a reference u/s.92CA(1) of the Act, was made to the Transfer Pricing Officer (in short "TPO") to determine 'Arms Length Price' of the international transactions with its AEs for both assessment years. The TPO vide their order dated 28.01.2021 for AY 2017-18 and vide their order dated 29.07.2021 for AY 2018-19 has made an upward adjustment to the Revenue of the assessee company for both assessment years. The TPO for the reasons stated in their orders dated 28.01.2021 & 29.07.2021, has made an adjustment of Rs.263.52 Crs. for AY 2017-18 and further sum of Rs.284.25 Crs. for AY 2018-19. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prescribed time limit and they are barred by limitation and liable to be quashed. 6. The ld. DR, Ms. Ann Mary Baby, CIT, on the other hand, supporting the order of the AO, submitted that there is no dispute with regard to dates and events referred to by the Ld. Counsel for the assessee in their submissions and further, it is also not in dispute that the final assessment orders passed by the AO is beyond the prescribed time limit provided u/s.144C(13) of the Act, and thus, the issue may be decided in accordance with law. 7. We have heard both the parties, perused the materials available on record and gone through orders of the authorities below. The provisions of Sec.144C(13) of the Act, deals with time limit for passing final assessment order by the AO upon receipt of the directions issued by the DRP u/s.144C(5) of the Act. As per said provisions, upon receipt of the directions issued as per Sub-Section (5), the AO shall inconformity with the directions, complete, notwithstanding anything to the contrary contained in Sec.153 (or Sec.153B assessment) without providing any further opportunity being heard to the assessee, within one month from the end of the month, in which, such di ..... X X X X Extracts X X X X X X X X Extracts X X X X
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