VISTAAR SYSTEMS PVT LTD., MUMBAI V. ADDL CIT RG 10(1) MUMBAI, MUMBAI

CO 95/MUM/2009

• Counselvise Citation: [2012] 122 COUNSELVISE.COM (IT) 7244 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s) 28 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 25-05-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: L
• Next Hearing Date: 24-01-2012
• Assessment Year: 2003-2004
• Appeal Filed On: 28-05-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: V CHANDRASEKHAR
• Keywords: Transfer pricing; International transaction; Reasonable cause; Fair market value; Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL L BENCH, MUMBAI BEFORE SHRI B.R. MITTAL, JUDICIAL MEMBER AND SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER ITA NO. 3065/MUM./2008 (ASSESSMENT YEAR : 2003-04 ) ASSTT. COMMISSIONER OF INCOME TAX RANGE10(1), AAYAKAR BHAVAN 101, M.K. ROAD, MUMBAI 400 020 .. APPELLANT V/S M/S. VISTAAR SYSTEMS PVT. LTD. RAHEJA POINT, A WING, J.N. ROAD VAKOLA, SANTACRUZ (E) MUMBAI 400 055 PAN AABCV0613J .... RESPONDENT CROSS OBJECTION NO.95/MUM./2009 ARISING OUT OF ITA NO. 3065/MUM./2008 (ASSESSMENT YEAR : 2003-04 ) M/S. VISTAAR SYSTEMS PVT. LTD. RAHEJA POINT, A WING, J.N. ROAD VAKOLA, SANTACRUZ (E) MUMBAI 400 055 PAN AABCV0613J . CROSS OBJECTOR V/S ASSTT. COMMISSIONER OF INCOME TAX RANGE10(1), AAYAKAR BHAVAN 101, M.K. ROAD, MUMBAI 400 020 .... RESPONDENT ITA NO. 955/MUM./2010 (ASSESSMENT YEAR : 2004-05 ) DY. COMMISSIONER OF INCOME TAX RANGE10(1), AAYAKAR BHAVAN 101, M.K. ROAD, MUMBAI 400 020 .. APPELLANT V/S M/S. VISTAAR SYSTEMS P. LTD. 2 M/S. VISTAAR SYSTEMS PVT. LTD. RAHEJA POINT, A WING, J.N. ROAD VAKOLA, SANTACRUZ (E) MUMBAI 400 055 PAN AABCV0613J .... RESPONDENT ITA NO. 1264, 1265/MUM./2010 (ASSESSMENT YEARS : 2005-06, 2006-07 ) INCOME TAX OFFICER RANGE10(1), AAYAKAR BHAVAN 101, M.K. ROAD, MUMBAI 400 020 .. APPELLANT V/S M/S. VISTAAR SYSTEMS PVT. LTD. RAHEJA POINT, A WING, J.N. ROAD VAKOLA, SANTACRUZ (E) MUMBAI 400 055 PAN AABCV0613J .... RESPONDENT ITA NO. 3559/MUM./2010 (ASSESSMENT YEAR : 2007-08 ) DY. COMMISSIONER OF INCOME TAX RANGE10(1), AAYAKAR BHAVAN 101, M.K. ROAD, MUMBAI 400 020 .. APPELLANT V/S M/S. VISTAAR SYSTEMS PVT. LTD. RAHEJA POINT, A WING, J.N. ROAD VAKOLA, SANTACRUZ (E) MUMBAI 400 055 PAN AABCV0613J .... RESPONDENT REVENUE BY : MR. AJIT KU MAR JAIN ASSESSEE BY : MR. V. CHANDRASEKHAR DATE OF HEARING 12.04.2012 DATE OF ORDER 25.05.2012 O R D E R PER BENCH M/S. VISTAAR SYSTEMS P. LTD. 3 THE APPEALS PREFERRED BY THE REVENUE, ARE DIRECTED AGAINST THE IMPUGNED SEPARATE ORDERS DATED 25 TH FEBRUARY 2010, FOR ASSESSMENT YEAR 2007-08, ORDER 25 TH JANUARY 2008, FOR ASSESSMENT YEAR 2003-04, ORDER DATED 3 RD DECEMBER 2009, FOR ASSESSMENT YEAR 2005-06, ORDER DATED 4 TH DECEMBER 2009, FOR ASSESSMENT YEAR 2006-07, AND ORD ER DATED 30 TH NOVEMBER 2009, FOR ASSESSMENT YEAR 2004-05, PASSED BY THE COMMISSIONER (APPEALS), MUMBAI, RESPECTIVELY. THE ASSESSEE ALSO PREFERRED CROSS OBJECTION, WHICH AROSE OUT OF ITA NO.3065/MUM./2008 , FOR ASSESSMENT YEAR 2003-04. AS THE ISSUE BEING COMMON IN ALL THESE APP EALS, FOR THE SAKE OF CONVENIENCE, THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY WAY OF THIS CONSOLIDATED ORDER. 2. BEFORE US, THE LEARNED DEPARTMENTAL REPRESENTATIVE, MR. AJIT KUMAR JIAN, REPRESENTING THE REVENUE, SUBMITTED THAT THER E IS ONLY ONE ISSUE THAT ARISES IN ALL THESE APPEALS PREFERRED BY THE REVENU E. 3. THE CROSS OBJECTION PREFERRED BY THE ASSESSEE IS BA RRED BY LIMITATION, AS THE SAME IS FILED WITH A DELAY OF 243 DAYS. WE F IRST PROCEED TO ADJUDICATE THE ISSUE OF LIMITATION. 4. BEFORE US, THE LEARNED COUNSEL, MR. V. CHANDRASEKHA R, REPRESENTING THE ASSESSEE, FILED AN APPLICATION FOR CONDONATION OF DELAY AS WELL AS AN AFFIDAVIT IN SUPPORT OF THE REASONS GIVEN FOR CONDO NATION. THE REASONS STATED FOR THE DELAY IN FILING THE CROSS OBJECTIONS ARE TH AT, ON PROFESSIONAL ADVICE FROM THE PRESENT COUNSEL, THESE CROSS OBJECTIONS WE RE FILED. IT WAS PLEADED BY THE LEARNED COUNSEL THAT A LENIENT VIEW BE TAKEN , AS IT WILL LEAD THE ASSESSEE TO A GREAT HARDSHIP AND IRREPARABLE INJURY . RELIANCE WAS PLACED ON CERTAIN CASE LAWS. 5. LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER H AND, OPPOSED THE CONTENTIONS OF THE LEARNED COUNSEL. 6. ON CAREFUL CONSIDERATION OF THE RIVAL CONTENTIONS A ND THE REASONS GIVEN FOR CONDONATION OF DELAY, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEE M/S. VISTAAR SYSTEMS P. LTD. 4 HAS NOT DEMONSTRATED THAT IT HAD A REASONABLE CAUSE FOR FILING THE CROSS OBJECTIONS WITH A DELAY OF 243 DAYS. ADVICE, CONSEQ UENT TO CHANGE OF COUNSEL, CANNOT BE ACCEPTED AS A PROPER REASON WITH OUT ADDUCING ANY EVIDENCE ON RECORD. THUS, THE CROSS OBJECTIONS PREF ERRED BY THE ASSESSEE ARE DISMISSED. 7. IN THE RESULT, ASSESSEES CROSS OBJECTION IS DISMIS SED. WE NOW PROCEED TO DISPOSE OFF THE REVENUES APPEAL S. FACTS IN BRIEF :- 8. THE LEAD ORDER IS THE ORDER FOR ASSESSMENT YEAR 200 3-04. THE ASSESSING OFFICER HAD, VIDE PARAS-2 AND 3 OF HIS OR DER, BROUGHT OUT THE FACTS WHICH ARE EXTRACTED FOR READY REFERENCE. 2. THE ASSESSEE COMPANY WAS SET UP IN MARCH 2000 WI TH THE OBJECTIVE OF BEING A GLOBAL B2B INFRASTRUCTURE PROV IDER, INVESTING AND INCUBATING SEVERAL NEUTRAL E-MARKET PLACES, TECHNOL OGY COMPANIES AND SERVICE PROVIDERS IN THE B2B SPACE (INTERNET E-COMM ERCE AND SOFTWARE DEVELOPMENT). VISTAAR PROVIDED TECHNOLOGY AND OPERA TIONAL SUPPORT TO VISTAAR TECHNOLOGIES INC. ON VARIOUS PROJECTS FOR T HE SHIPPING, CHEMICAL INDUSTRY AND SOFTWARE DEVELOPMENT SERVICES FOR BUIL DING ENTERPRISE PRODUCTS. 3. THE CASE WAS REFERRED TO THE ADDL. COMMISSIONER OF INCOME TAX (TRANSFER PRICING), MUMBAI ON 05.11.2004 U IS 92 CA (1) OF THE INCOME TAX ACT, 1961 FOR COMPUTATION OF ARMS LENGTH PRICE IN RELATION TO INTERNATIONAL TRANSACTIONS FOR THE YEAR UNDER REFER ENCE. THE ADDL. CIT TRANSFER PRICING III), MUMBAI VIDE ORDER U/S 92 C A(3) OF THE INCOME TAX ACT, 1961 DATED 23.03.2006 DETERMINED THE ARMS LENGTH PRICE BY MAKING ADJUSTMENT OF RS.2,47,09,042/- TO THE INTERN ATIONAL TRANSACTIONS. THE RELEVANT PORTION OF THE ORDER IS REPRODUCED AS UNDER: 1. THE CUP ANALYSIS UNDERTAKEN BY THE ASSESSEE FAIL S IN THE PRESENT SCENARIO DUE TO LACK OF STRICT COMPARABILITY BETWEE N THE UNCONTROLLED TRANSACTION AND THE ASSESSEES INTERNATIONAL TRANSA CTIONS. 2. IN VIEW OF THIS, THIS OFFICE HAS UNDERTAKEN A SE ARCH TO IDENTIFY COMPANIES ENGAGED IN SOFTWARE DEVELOPMENT, WHICH IS AKIN TO THE ASSESSEES BUSINESS ACTIVITY. 3. IN A NET MARGIN ANALYSIS A STRICT FUNCTIONAL COM PARABILITY IS NOT REQUIRED AND THE THIRD PARTY TRANSACTIONS CAN BE CO MPARED IF THE OVERALL FUNCTIONS ARE SIMILAR. AS THE ASSESSEE IS E NGAGED IN THE SOFTWARE DEVELOPMENT, I.E, DEVELOPMENT OF BUSINESS INTELLIGENCE / ERP PRODUCTS WHICH IS NOTHING BUT SOFTWARE DEVELOPMENT COMPANIES M/S. VISTAAR SYSTEMS P. LTD. 5 ENGAGED IN THE SOFTWARE DEVELOPMENT WOULD BE COMPAR ABLE TO THE ASSESSEE. 4. THE ASSESSEE HAS MENTIONED THAT IN PRODUCT DEVEL OPMENT COMPANY LIKE THE ASSESSEE A GESTATION PERIOD IS BETWEEN 5 T O 10 YEARS. HOWEVER, THE ASSESSEE IS MERELY A SERVICE PROVIDER AND NOT THE PRIME RISK BEARER IN THE ENTIRE SOFTWARE DEVELOPMENT ACTI VITY. THE ASSESSEES PARENT COMPANY IS THE RISK BEARER AND HENCE SHOULD BEAR THE ALL THE LOSSES DURING THE GESTATION PERIOD. THE ASSESSEE SH OULD GET COMPENSATED ON THE BASIS OF THE THIRD PARTY RATES A ND HENCE EARN A NET MARGIN WHICH IS COMPARABLE TO THE THIRD PARTY N ET MARGINS. IN VIEW OF THE ABOVE, TNM METHOD IS BEING APPLIED T O THE ASSESSEES TRANSACTIONS AND THE ARMS LENGTH MARGIN OF 9.05% TH EREFORE, TAKEN FOR CALCULATING THE ARMS LENGTH PRICE. THE ASSESSEE HAS INCURRED A COST OF RS.8,20,62,240/ - FOR PROVISION OF SERVICES TO ITS ASSOCIATED ENTERPRISES. ACCORDINGLY , THE ASSESSEE SHOULD HAVE EARNED A REVENUE OF RS.8,94,88,872/- (82062240 + 9.05%). AS AGAINST THIS, THE ASSESSEE EARNED A REVENUE OF RS.6 ,47,79,830/-. IN VIEW OF THIS, AN ADJUSTMENT OF RS.2,47,09,042/- IS BEING MADE TO THIS INTERNATIONAL TRANSACTION. IT IS HEREBY CLARIFIED THAT THE FINDINGS AND DISCUS SIONS MADE IN THIS ORDER ARE APPLICABLE ONLY IN RESPECT OF REFERENCE R ECEIVED FOR A. Y 2003-04 AND NOT FOR SUBSEQUENT ASSESSMENT YEARS. IN VIEW OF THE ABOVE, AS HAS BEEN DETERMINED BY THE ADDL. CIT (TRANSFER PRICING III), MUMBAI AN AMOUNT OF RS.2,4 7,09,042/- IS ADDED TO THE TOTAL INCOME OF THE ASSESSEE UNDER SEC TION 92CA(1) OF THE INCOME TAX ACT, 1961. PENALTY PROCEEDINGS U/S 2 71(1)(C) OF THE INCOME TAX ACT, 1961 ARE INITIATED SEPARATELY. 9. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER BEFORE T HE FIRST APPELLATE AUTHORITY, WHEREIN THE COMMISSIONER (APPEALS) DELET ED THE ADDITION. FURTHER AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE TRIB UNAL ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) ERRED IN DELETING THE ADDITION O F ` 2,47,09,042, BEING MADE UNDER SECTION 92CA BY THE TRANSFER PRICI NG AUTHORITY CALCULATING ARMS LENGTH PRICE OF THE ASSESSEES TRA NSACTION BY TNM METHOD REJECTING CUP METHOD IGNORING THE FACT THAT IN A NET MARGIN ANALYSIS A STRICT FUNCTIONAL COMPARABILITY IS NOT R EQUIRED AND THIRD PARTY TRANSACTION CAN BE COMPARED IF THE OVERALL FUNCTION S ARE SIMILAR . 10. THE LEARNED DEPARTMENTAL REPRESENTATIVE TOOK THIS B ENCH TO THE ORDER OF THE TPO AND SUBMITTED THAT THE ASSESSEE CLAIMS T O HAVE APPLIED CUP M/S. VISTAAR SYSTEMS P. LTD. 6 METHOD AND HAS TAKEN THE AVERAGE RATE PER MAN HOUR FOR COMPARISON. HE ARGUED THAT CUP METHOD REQUIRES STRICT COMPARABILITY BETWEEN UNCON TROLLED TRANSACTIONS AND ASSESSEES INTERNATIONAL TRANSACTI ONS WITH AE. HE SUBMITTED THAT THE TPO HAD RIGHTLY REJECTED THE METHODOLOGY A DOPTED BY THE ASSESSEE ON THE GROUND THAT THERE IS NO COMPARABILITY AS THE SET OF SKILLS THAT AN EMPLOYEE REQUIRES VARY FROM FUNCTION TO FUNCTION. H E SUPPORTED THE METHOD ADOPTED BY THE TPO I.E., TNM METHOD. REFERRING TO T HE ORDER OF THE FIRST APPELLATE AUTHORITY, HE DISPUTED THE FINDINGS THAT TNM IS NOT THE MOST APPROPRIATE METHOD. HE REFERRED TO THE ASSESSEES P APER BOOK PAGE-10 AND ARGUED THAT THIS IS NOT A CASE WHERE THE ASSESSEE H AS PROVIDED ONLY MANPOWER BUT A CASE WHERE THE ASSESSEE HAD DEVELOPE D THE SOFTWARE. HE REFERRED TO FORM-26, IN 3CEB REPORT AND FACTS MENTI ONED THEREIN. HE RELIED ON THE ORDER OF THE TPO. 11. LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND , SUBMITTED THAT THE ASSESSEE IS DEVELOPING SPECIFIED SOFTWARE WHICH ONLY THE AE CAN USE AND NONE ELSE. HE REFERRED TO THE CONTRACT BETWEEN THE PARTIES AND SUBMITTED THAT IT IS CLEARLY PROVIDED THEREIN THAT WHAT WILL BE CHARGED IS THE PREVAILING MARKET RATE. HE FURTHER POINTED OUT THAT FOR EXECUT ING THE JOB WHICH THE ASSESSEE GOT FROM THE AE, IT HAD TO OUTSOURCE A PAR T OF THIS JOB AS THE ASSESSEE DID NOT POSSESS THE REQUISITE SKILLS. HE S UBMITTED THAT THE OUTSOURCEING WAS DONE TO REPUTED COMPANIES SUCH AS L&T SOFTWARE, TCS, ETC. HE SUBMITTED THAT THESE ARE UNCONNECTED THIRD PARTIES AND THE ASSESSEE PAID THESE UNCONNECTED PARTIES A RATE OF ` 1,250, PER HOUR IN THE CASE OF L&T SOFTWARE AND ` 625, PER HOUR FOR TCS, WHICH WAS FOR THE SAME JOB AND THESE PAYMENTS ARE TAKEN AS COMPARABLES. THUS, HE SUBMITT ED THAT THE ASSESSEE APPLIED THE CUP METHOD AS A MOST APPROPRIATE METHOD . HE FURTHER RELIED ON THE DECISION OF MUMBAI BENCH OF THE TRIBUNAL IN SER DIA PHARMACEUTICALS INDIA P. LTD. V/S ACIT, [2011] 136 TTJ 129 (MUM.), AND TH E DECISION OF PUNE BENCH OF THE TRIBUNAL IN ACIT V/S MSS INDIA P. LTD. , 123 TTJ 657, FOR THE PROPOSITION THAT (I) TRADITIONAL TRANSACTION METH OD AND PARTICULARLY CUP METHOD ARE PREFERRED METHODS OVER TRANSACTIONAL PRO FIT METHODS SUCH AS TNMM; (II) IF THE REVENUE AUTHORITIES SEEKS TO DIST URB THE METHOD ADOPTED M/S. VISTAAR SYSTEMS P. LTD. 7 BY THE ASSESSEE IN DETERMINING THE ALP, IT IS NECES SARY FOR THE REVENUE TO DEMONSTRATE THAT A PARTICULAR METHOD WOULD BE MORE APPROPRIATE METHOD VIS--VIS THE METHOD ADOPTED BY THE ASSESSEE. HE AR GUED THAT THE VERACITY OF THE INPUTS TAKEN BY THE COMPANY FOR APPLYING CUP METHOD ARE NOT DISPUTED AND THE REVENUE HAS NOT DEMONSTRATED FALLA CIES IN THE APPLICATION OF CUP METHOD. 12. COMING TO THE ASSESSMENT YEAR 2004-05, IT WAS SUBMI TTED THAT THERE IS ONE ADDITIONAL GROUND I.E., THE RATE OF DEPRECIA TION. IN OTHER WORDS I.E., THE YEAR 2005-06, 2006-07 AND 2007-08, THE ISSUE OF DET ERMINATION OF ALP IS THE SOLE GROUND. 13. RIVAL CONTENTIONS HEARD. ON A CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND ON A PERUSAL OF THE P APERS ON RECORD, AS WELL AS THE CASE LAWS CITED BEFORE US, WE HOLD AS FOLLOW S:- 14. THE ASSESSEE IS A SUBSIDIARY OF A U.S. COMPANY AND HAS PROVIDED SOFTWARE DEVELOPMENT SERVICES. AS PER CLAUSE-4 OF T HE AGREEMENT, WHICH IS PLACED AT PAPER BOOK ANNEXURE-A, IT IS STATED THAT THE BILLING SHALL BE LINKED TO COMPARABLE MARKET RATES IN INDIA FOR SIMILAR SER VICES. THE ASSESSEE HAS, DUE TO NON-AVAILABILITY OF PERSONNEL, WITH A CERTAI N SET OF SKILLS THAT WERE REQUIRED FOR DEVELOPING CERTAIN SOFTWARE, HAD OUTSO URCED THIS JOB TO L&T SOFTWARE, TCS, ETC. THESE COMPANIES HAVE CHARGED TH E ASSESSEE @ ` 1,250, PER HOUR AND ` 625 PER HOUR FOR THE TOTAL NUMBER OF MAN HOURS SPE NT BY THEIR PERSONNEL IN PERFORMING THE TASK OUTSOURCED T O THEM. 15. THE RATES CHARGED BY THEM TO AE, ARE COMPARABLE TO THE RATE CHARGED BY THE L&T SOFTWARE AND TCS TO THE ASSESSEE FOR THE VERY SAME JOB WORK. THE UNDISPUTED FACTS ARE THAT L&T SOFTWARE AND TCS ARE GIANTS IN THE SOFTWARE INDUSTRIES AND ARE COMPANIES WITH HIGH REP UTATION. THE AMOUNTS PAID TO THEM, REPRESENT FAIR MARKET VALUE. WHEN THE ASSESSEE ADOPTS THESE RATES AS COMPARABLE UNDER CUP METHOD NO FAULT CAN B E FOUND. IN VIEW OF THE ABOVE DISCUSSION, WE UPHOLD THE FOLLOWING FINDINGS OF THE FIRST APPELLATE AUTHORITY. M/S. VISTAAR SYSTEMS P. LTD. 8 I) THE RATES CHARGED BY THE ASSESSEE COMPANY ARE IDENT ICAL TO THE RATES CHARGED BY THE THIRD PARTIES IN THE SA ME LINE OF BUSINESS FOR THE SAME JOB AND THE ASSESSEE HAS PROV ED THE SAME WITH EVIDENCE. II) THE TPO HAS NOT BROUGHT OUT ANY MATERIAL ON RECORD TO PROVE THAT THE PER HOUR RATE CHARGED BY THE ASSESSE E COMPANY IS LOWER THAN THAT CHARGED BY THE THIRD PARTIES IN THE SAME LINE OF BUSINESS; III) NO REASON IS GIVEN FOR REJECTING THE CUP METHOD; IV) OECD GUIDELINES STATE THAT CUP METHOD IS MOST DIREC T AND RELIABLE METHOD WHEN COMPARABLE UNCONTROLLED TRANSA CTIONS ARE AVAILABLE; V) THE ASSESSING OFFICER HAS NOT GIVEN ANY REASON THAT TNM IS THE BEST METHOD AND THE CUP METHOD IS NOT APPROPRIA TE; VI) THE TPO HAS NOT DEALT WITH THE ARGUMENTS OF THE ASS ESSEE THAT THE ASSESSEE IS NOT A NORMAL SOFTWARE SERVICE COMPANY AND IS IN FACT ENGAGED IN B.I/ERP PROJECT DEVELOPMENT W HICH IS A KIND OF R&D ACTIVITY FOR WHICH THE REVENUE WOULD AR ISE ONLY AFTER DEVELOPMENT OF THE PROJECT FULLY; VII) THE TPO IGNORED THE AGREEMENT OF THE ASSESSEE WITH THE AE THAT IT HAS BEEN GIVEN ABSOLUTE RIGHT FOR EXPLOI TATION OF THE PROJECT IN THE INDIAN REGION AND NEARBY TERRITORY A FTER ITS DEVELOPMENT; 16. THUS, WE UPHOLD THE AFORESAID FINDINGS OF THE COMMI SSIONER (APPEALS) AND DISMISS THE GROUND OF THE REVENUE. M/S. VISTAAR SYSTEMS P. LTD. 9 17. FOR ASSESSMENT YEAR YEARS 2006-07 AND 2007-08, THE SAME ADJUSTMENT HAS BEEN MADE BY THE ASSESSING OFFICER H IMSELF. NO REFERENCE WAS MADE TO THE TPO. 18. THE ASSESSEE CONTENDS THAT THE ASSESSING OFFICER HA S NO SUCH POWER. AS ON MERIT, WE HAVE UPHELD THE CONTENTION OF THE A SSESSEE AND DISMISS THE ADJUSTMENT MADE BY THE TPO / ASSESSING OFFICER, WE DO NOT DEAL WITH THIS ISSUE AS IT WOULD BE OF ACADEMIC EXERCISE. 19. IN THE RESULT, ALL THE APPEALS PREFERRED BY THE REV ENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH MAY 2012 SD/- B.R. MITTAL JUDICIAL MEMBER SD/- J. SUDHAKAR REDDY ACCOUNTANT MEMBER MUMBAI, DATED: 25 TH MAY 2012 COPY TO : (1) THE ASSESSEE; (2) THE RESPONDENT; (3) THE CIT(A), MUMBAI, CONCERNED; (4) THE CIT, MUMBAI CITY CONCERNED; (5) THE DR, L BENCH, ITAT, MUMBAI. TRUE COPY BY ORDER PRADEEP J. CHOWDHURY ASSISTANT REGISTRAR SR. PRIVATE SECRETARY ITAT, MUMBAI BENCHES, MUMBAI