9911796707
TMI Blog2025 (3) TMI 1263X X X X Extracts X X X X X X X X Extracts X X X X ..... cts of the case as follows:- The assessee is a private limited company. It is engaged in the dealing of specialty chemicals meant for paper & pulp, leather, direct water treatment and other customer specific applications. The assessee is a subsidiary of Bulab Holdings Inc. USA. For the assessment year 2018-19, return of income was filed on 30.11.2018 declaring total taxable income of Rs. 8,35,75,210/-. While arriving at taxable income, the assessee had claimed as deduction u/s.37(1) of the Income Tax Act, 1961, the following payments made to its Associate Enterprise (AE) Buckman Laboratories International Inc.USA (Buckman US): a) For shared services availed during the year a shared service fee of Rs. : 87,15,270 b) For the u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th financial implications have to be interpreted very strictly. ii) The Appellant is deriving major portion of income from sale of traded goods. iii) Buckman India has not utilized the know-how in the business and thus the royalty is disallowed u/s 37 of the Act." 4. Aggrieved by the assessment completed by making aforesaid disallowances, the assessee filed an appeal before First Appellate Authority. The CIT(A) confirmed the view taken by the AO by stating that the assessee had not established the services have been actually received by the assessee for making aforesaid payments. It was also stated by the CIT(A) that assessee has not furnished supporting evidences in respect of claim of deduction made. 5. Aggrieved by the order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adjudication of the issues raised in this appeal. 6. The Ld.DR apart from supporting orders of the AO and CIT(A), did not have serious objection in restoring the matter to the files of the AO. 7. We have heard rival submissions and perused the records. The assessee in its submissions made before the First Appellate Authority (submissions dated 23.05.2024) had specifically requested that it may be granted an opportunity to represent its case through video conferencing or physical hearing before the order is passed. In spite of specific request made by the assessee, the assessee was not given an opportunity to represent its case through video conferencing or physical hearing. Many of the documents / evidences filed in support of claim of d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le basis) i. Technical Reports 147-150 ii. Guide notes for marketing activities 151-152 (b) Email exchanges towards IT services received by the Appellant from AE i. Affidavit in relation to email exchanges 153-155 ii. Copies of sample e-mail exchanges towards IT services received by the appellant from AE 156-185 4 Analysis of margin earned by companies engaged in similar business 186 Further, to the above, the Assessee wishes to submit as under: i. Regarding SOPs of chemicals for sales made by the Appellant during the year: By virtue of the Non-Exclusive Patent and Technology License Agreement entered by Buckman India with Buckman US, Buckman US provides technical know-how ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... actual Paper book) Also, these documents were not submitted as these were not expressly requested during the / assessments by the Ld. CIT(A) / Learned Assessing Officer (Ld. AO). As the Appellant has only recently obtained access to provide these documents before the [Hon'ble Tribunal for the sole requirement of this appeal, we wish to submit the aforementioned documents as supporting additional evidence in the aforementioned application. Regarding other documents provided as additional evidence (other than SOPs as mentioned above): Documents submitted are only supporting in nature and are submitted only to facilitate in objective consideration of Appellant's claims. The aforementioned additional evidences being reque ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial in nature. Therefore, approval from the executive management was required and obtained at the time of appellate proceedings before the Tribunal. Moreover, these documents were not expressly requested during the course of assessment proceedings or before first appellate proceedings. The documents that are now submitted before the Tribunal goes to the root of the dispute. For substantial justice and for a proper adjudication of issues raised in this appeal, we take the same on record. Since the additional evidences / documents are taken on record, we deem it appropriate to restore the matter to the files of AO for him to examine these aspects and come to a conclusion whether the payments claimed as deduction u/s.37 were for the purpose of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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