Nava Bharat Ventures Limited, Hyderabad V. Dy.Commissioner of Income Tax, Circle-16(1), Hyderabad

ITA 1501/Hyd/2017

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 4582 (ITAT-HYDERABAD)
• Duration Of Justice: 4 year(s) 1 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-09-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-A
• Next Hearing Date: 07-09-2021
• Assessment Year: 2011-2012
• Appeal Filed On: 23-08-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Transfer pricing; International transaction; Question of law
• Section: 92C; 43B; 143(3); 10AA; 10B; 144C; 139(1); 13; 119; 6; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD. BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI L . P . SAHU, ACCOUNTANT MEMBER (THROUGH VIRTUAL HEARING) ITA NO. 1603 /HYD/20 17 (ASSESSMENT YEAR : 20 11 - 12 ) ASST. COMMISSIONER OF INCOME TAX, CIRCLE 16(1), HYDERABAD. ..APPELLANT. VS. NAVA BHARAT VENTURES LIMITED , HYDERABAD. ..RESPONDENT . PAN AAACN 7327C ITA NO.1501/HYD/2017 (ASSESSMENT YEAR : 2011 - 12) DY . COMMISSIONER OF INCOME TAX, CIRCLE 16(1), HYDERABAD. ..APPELLANT. VS. NAVA BHARAT VENTURES LIMITED, HYDERABAD. ..RESPONDENT. APPELLANT BY : SHRI SUNKU SRINIVAS. (D.R.) RESPONDENT BY : SHRI PVSS PRASAD. DATE OF HEARING : 7.9 . 2021. DATE OF PRONOUNCEMENT : 29 .0 9 .2021. O R D E R PER SHRI S.S. GODARA, J.M. : TH E S E ASSESSEE'S AND REVENUES CROSS APPEALS ITA NOS.1501 AND 1603/HYD/2017 FO R ASSESSMENT YEAR 2011 - 12 ARISE FROM THE COMMISSIONER OF INCOME TAX (APPEALS) - 4 , 2 ITA NO S . 1501 & 1603/HYD/2017 HYDERABAD S ORDER DT. 27.06.2017 PASSED IN CASE NO. IN PROCEEDINGS UNDER SECTION 143(3) R.W.S. 92CA(3) & 144C OF INCOME TAX ACT, 1961 (THE ACT). HEARD BOTH THE PARTIES . C ASE FILE PERUSED. 2. THE ASSESSEE S APPEAL ITA 1501/HYD/2017 RAISES THE FOLLOWING SOLE SUBSTANTI VE GROUND : 2. A) THE CIT(A) IS NOT JUSTIFIED IN CONFIRMING ADDITION OF RS.5,18,12,581/ - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF TRANSFER PRICING IN THE SELLING PRICES OF FERRO ALLOYS SIMPLY STATING THAT APPELLANTS SUBMISSIONS ON THE ISSUE ARE NOT ACCEPTED WITHOUT STATING AS TO HOW SUCH SUBMISSIONS CANNOT BE ACCEPTED. B) THE CIT(A) OUGHT TO HAVE SEEN THAT DUTY ENTITLEMENT PASS BOOK (DEPB) / FOCUS PRODUCTS SCHEME (FPS) BENEFITS ARE GIVEN TO EXPORTERS TO COMPENSATE THEM IN VIEW OF THE FACT THAT SELLIN G PRICES IN INTERNATIONAL MARKET ARE LOWER THAN DOMESTIC PRICES AND THEREFORE SUCH BENEFITS ARE TO BE CONSIDERED FOR COMPARING THE SELLING PRICES OF FERRO ALLOYS TO ITS AE WITH THE PRICES QUOTED IN ASIAN METAL EXCHANGE SINCE PRICES QUOTED IN ASIAN METAL E XCHANGE ARE FOR DOMESTIC SALES ONLY. HENCE IGNORING DEPB / FPS BENEFITS WHILE 3 ITA NO S . 1501 & 1603/HYD/2017 COMPARING THE PRICES OF FERRO ALLOYS IS NOT JUSTIFIED. 3. FOR ALL OF THE ABOVE AND SUCH OTHER GORUNDS AS MAY BE URGED AT THE TIME OF HEARING IT IS MOST RESPECTFULLY PRAYED THAT THIS HONBLE TRIBUNAL MAY BE PLEASED TO ALLOW THE APPEAL AND DIRECT THE RESPONDENT HEREIN TO DELETE THE ADJUSTMENT OF RS.5,18,12,581/ - MADE ON ACCOUNT OF TRANSFER PRICING IN THE AS SESSMENT ORDER. 3. WE NEXT NOTE THAT THE INSTANT ISSUE REGARDING INCLUSION OF ASSESSEE'S DUTY ENTITLEMENT P ASS BOOK (D E P B ) AND FOCUS PRODUCTS SCHEME (FPS) ON EXPORT OF FERRO ALLOYS ; AS AN ADJUSTMENT IN COMPUTING ARMS LENGTH PRICE (ALP) ADJUSTMENT AS PER RULE 10B(1)(A)(2) AND (3) IS FOUND TO BE NO MORE RES INTEGRA AS REVENUES APPEAL ITA NO.634/HYD/2018 DT.22.07.2021 QUA THE SAME STANDS ACCEPTED AS FOLLOWS : 7. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO RI VAL PLEADINGS QUA THE ASSESSEES CASE THAT ITS DPEB BENEFITS DERIVED FROM SALE OF SILICO MANGANESE FERRO CHROME DESERVE TO BE CONSIDERED AS AN ADJUSTMENT UNDER RULE 10B(1)(A)(II) OF THE INCOME TAX RULES. LEARNED COUNSEL HAS ALSO FILED A WRITTEN NOTE WITH C ATENA OF CASE LAW HONBLE BOMBAY HIGH COURT (SUPRA), (2020) 119 TAXMANN.COM 401 (BANGALORE - TRIB) REITZEL INDIA (P.) LTD., VS. DCIT, (2019) 101 4 ITA NO S . 1501 & 1603/HYD/2017 TAXMANN.COM 325 (PUNETRIB), CUMMINS INDIA LTD., VS. DCIT, (2018) 97 TAXMANN.COM 494 (KOLKATA - TRIB) DCIT VS. JJ EXPORTERS LTD. HOLDING THAT SINCE DPEB BENEFITS ARE EXPORT INCENTIVES FORMING PART OF OPERATING REVENUES, THE SAME ALSO DESERVE TO BE CONSIDERED AS AN ADJUSTMENT UNDER RULE 10B OF THE RULES. 8. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO FOREGOIN G RIVAL PLEADINGS AND FIND NO REASON TO AGREE WITH THE ASSESSEES STAND SUPPORTING THE CIT(A)S FOREGOING CONCLUSION. THIS IS FOR THE PRECISE REASON THAT WE ARE DEALING WITH CHAPTER - X OF THE ACT IN THE NATURE OF (A) SPECIAL PROVISION RELATING TO AVOIDANC E OF ACT INTRODUCED AS AN ANTI - AVOIDANCE MEASURE BY THE LEGISLATURE. SECTION 92(1) THEREUNDER STIPULATES THAT ANY INCOME ARISING FROM AN INTERNATIONAL TRANSACTION SHALL BE COMPUTED HAVING REGARD TO THE ARMS LENGTH PRICE. SECTION 92C PRESCRIBES THE DETAIL ED MECHANISM FOR ALP COMPUTATION. SUB - SECTION (4) 1ST PROVISO THEREOF ENVISAGES THAT NO DEDUCTION U/S.10A [OR SECTION 10AA] OR SECTION 10B ARE UNDER CHAPTER - VI SHALL BE ALLOWED IN RESPECT OF THE AMOUNT OF INCOME BY WHICH THE TOTAL INCOME OF THE ASSESSEE I S ENHANCED AFTER COMPUTATION OF INCOME UNDER THIS SUB - SECTION. 8.1. THE FOREGOING STATUTORY PROVISO IN SECTION 92C(4) ALSO FORMED SUBJECT MATTER OF ADJUDICATION IN THIS TRIBUNALS SPECIAL BENCHS DECISION DOSHI SERVICES P. LTD. VS. DCIT (TS) 1086 - ITAT - 2019 (AHD) WHEREIN THE ASSESSEES ENDEAVOUR SEEKING TO APPLY PURPOSIVE CONSTRUCTION STANDS DECLINED ON 24 - 10 - 2019. 8.2. COUPLED WITH THIS, THE LEGISLATURE HAS ALSO INVESTED A DEFINITION CLAUSE IN SECTION 92F(II) THAT ARMS LENGTH PRICE MEANS A PRICE W HICH IS APPLIED OR PROPOSED TO BE APPLIED IN A TRANSACTION BETWEEN PERSONS OTHER THAN ASSOCIATED ENTERPRISES IN UN - CONTROLLED CONDITIONS. LEARNED COUNSEL IS FAIR ENOUGH IN HIGHLIGHTING THE ISSUE BEFORE US AS TO WHETHER THE DPEB BENEFITS DERIVED FROM THE C ORRESPONDING SCHEME 5 ITA NO S . 1501 & 1603/HYD/2017 OUGHT TO BE CONSIDERED FOR ADJUSTMENT OR NOT UNDER RULE 10B(1)(A)(III) BEING IN THE NATURE OF A DIFFERENCE MATERIALLY AFFECTING THE PRICE IN OPEN MARKET. HONBLE APEX COURTS LATEST FULL BENCH DECISION IN COMMISSIONER OF CUSTOMS VS. DILIP KUMAR (2018) 9 SCC 1 (FB)(SC) HOLDS THAT TAXING AND AN EXEMPTION PROVISIONS HAVE TO BE STRICTLY CONSTRUED AND BENEFIT OF DOUBT IN SUCH AN INSTANCE GOES TO THE ASSESSEE AND REVENUE; RESPECTIVELY. WE ARE UNABLE TO LOOSE SIGHT OF THE FACT THAT CHAPTER - X IS SPECIAL AS AGAINST ALL OTHER GENERAL PROVISIONS INCLUDING SECTION(S) 10, 10A, 10AA AND 10B ETC; AS THE CASE MAY BE. WE CITE LEGAL MAXIM GENERALIA SPEIALIBUS NON - DEROGANT MEANING THAT A GENERAL PROVISION DOES NOT APPLY AT THE COST OF THE SPECIAL O NE OR THE FORMER OF THEM MUST MAKE WAY FOR THE LATTER; RESPECTIVELY; AND, ARE OF THE OPINION THAT THE ASSESSEES ARGUMENTS GO AGAINST ARMS LENGTH PRICE DEFINED AS A PRICE WHICH IS APPLIED OR PROPOSED TO BE APPLIED IN A TRANSACTION BETWEEN PERSONS OTHER T HAN ASSOCIATE ENTERPRISES, IN UNCONTROLLED CONDITIONS ONLY. SO FAR AS THE ASSESSEES CASE THAT VARIOUS JUDICIAL PRECEDENTS (SUPRA) HAVE ALREADY DECIDED THE ISSUE IN ITS FAVOUR, WE QUOTE THE FOREGOING HONBLE APEX COURTS DECISION BINDING ON ALL THE COURT S WITHIN THE TERRITORY OF INDIA AS PER ARTICLE 141 OF THE CONSTITUTION AND HOLD THAT NONE OF THEM CONSIDER THE LEGISLATURE SCHEME IN CHAPTER - X (SUPRA). AND THAT DEVIATES THEREFROM WOULD NOT ONLY VIOLATES THE SAME BUT ALSO WOULD AMOUNTS TO NON - COMPLIANCE O F BETWEEN PERSONS IN SECTION 92F. 9. HON'BLE JURISDICTIONAL HIGH COURTS FULL BENCH DECISION IN (1993) 202 ITR 333 (AP) CIT VS. B.R.CONSTRUCTIONS ALSO HOLDS THAT A JUDICIAL PRECEDENT CEASES TO BE BINDING IN THE FOLLOWING CONDITIONS: 37. THE EFFECT O F BINDING PRECEDENTS IN INDIA IS THAT THE DECISIONS OF THE SUPREME COURT ARE BINDING ON ALL THE COURTS. INDEED, ARTICLE 141 OF THE CONSTITUTION EMBODIES THE RULE OF PRECEDENT. ALL THE SUBORDINATE COURTS ARE BOUND BY 6 ITA NO S . 1501 & 1603/HYD/2017 THE JUDGMENTS OF THE HIGH COURT. A SINGL E JUDGE OF A HIGH COURT IS BOUND BY THE JUDGMENT OF ANOTHER SINGLE JUDGE AND A FORTIORI JUDGMENTS OF BENCHES CONSISTING OF MORE JUDGES THAN ONE. SO ALSO, A DIVISION BENCH OF A HIGH COURT IS BOUND BY JUDGMENTS OF ANOTHER DIVISION BENCH AND FULL . A SINGLE J UDGE OR BENCHES OF HIGH COURTS CANNOT DIFFER FROM THE EARLIER JUDGMENTS OF CO - ORDINATE JURISDICTION MERELY BECAUSE THEY HOLD A DIFFERENT VIEW ON THE QUESTION OF LAW FOR THE REASON THAT CERTAINTY AND UNIFORMITY IN THE ADMINISTRATION OF JUSTICE ARE OF PARAMO UNT IMPORTANCE. BUT, IF THE EARLIER JUDGMENT IS ERRONEOUS OR ADHERENCE TO THE RULE OF PRECEDENTS RESULTS IN MANIFEST INJUSTICE, DIFFERING FROM THE EARLIER JUDGMENT WILL BE PERMISSIBLE. WHEN A DIVISION BENCH DIFFERS FROM THE JUDGMENT OF ANOTHER DIVISION B ENCH, IT HAS TO REFER THE CASE TO A FULL BENCH. A SINGLE JUDGE CANNOT DIFFER FROM A DECISION OF A DIVISION BENCH EXCEPT WHEN THAT DECISION OR A JUDGMENT RELIED UPON IN THAT DECISION IS OVERRULED BY A FULL BENCH OR THE SUPREME COURT, OR WHEN THE LAW LAID DO WN BY A FULL BENCH OR THE SUPREME COURT IS INCONSISTENT WITH THE DECISION. 38. IT MAY BE NOTICED THAT PRECEDENT CEASES TO BE A BINDING PRECEDENT (I) IF IT IS REVERSED OR OVERRULED BY A HIGHER COURT, (II) WHEN IT IS AFFIRMED OR REVERSED ON A DIFFEREN T GROUND, (III) WHEN IT IS INCONSISTENT WITH THE EARLIER DECISIONS OF THE SAME RANK, (IV) WHEN IT IS SUB SILENTIO, AND (V) WHEN IT IS RENDERED PER INCURIAM. 39. IN PARAGRAPH 578 AT PAGE 297 OF HALSBURY'S LAWS OF ENGLAND, FOURTH EDITION, THE RULE OF PER INCURIAM IS STATED AS FOLLOWS : 'A DECISION IS GIVEN PER INCURIAM WHEN THE COURT HAS ACTED IN IGNORANCE OF A PREVIOUS DECISION OF ITS OWN OR OF A COURT OF CO - ORDINATE JURISDICTION WHICH COVERED THE CASE BEFORE IT, IN WHICH CASE IT MUST DECIDED WHICH CASE TO FOLLOW; OR WHEN 7 ITA NO S . 1501 & 1603/HYD/2017 IT HAS ACTED I N IGNORANCE OF A HOUSE OF LORDS DECISION, IN WHICH CASE IT MUST FOLLOW THAT DECISION; OR WHEN THE DECISION IS GIVEN IN IGNORANCE OF THE TERMS OF A STATUTE OR RULE HAVING STATUTORY FORCE.' 40. IN PUNJAB LAND DEVELOPMENT AND RECLAMATION CORPORATION LTD. V. PRESIDING OFFICER, LABOUR COURT , THE SUPREME COURT EXPLAINED THE EXPRESSION 'PER INCURIAM' THUS (AT PAGE 36 OF 77 FJR) : 'THE LATIN EXPRESSION PER INCURIAM MEANS THROUGH INADVERTENCE. A DECISION CAN BE SAID GENERALLY TO BE GIVEN PER INCURIAM WHEN THE S UPREME COURT HAS ACTED IN IGNORANCE OF A PERVIOUS DECISION OF ITS OWN OR WHEN A HIGH COURT HAS ACTED IN IGNORANCE OF A DECISION OF THE SUPREME COURT.' 42. AS HAS BEEN NOTICED ABOVE, A JUDGMENT CAN BE SAID TO BE PER INCURIAM IF IT IS RENDERED IN IGNORANCE OR FORGETFULNESS OF THE PROVISIONS OF A STATUTE OR A RULE HAVING STATUTORY FORCE OR A BINDING AUTHORITY. BUT, IF THE PROVISION OF THE ACT WAS NOTICED AND CONSIDERED BEFORE THE CONCLUSION ARRIVED AT, ON THE GROUND THAT IT HAS ERRONEOUSLY REACHED THE CONCLU SION THE JUDGMENT CANNOT BE IGNORED AS BEING PER INCURIAM. IN SALMOND ON JURISPRUDENCE, TWELFTH EDITION, AT PAGE 151, THE RULE IS SATED AS FOLLOWS : 'THE MERE FACT THAT (AS IS CONTENDED) THE EARLIER COURT MISCONSTRUED A STATUTE, OR IGNORED A RULE OF CONS TRUCTION, IS NO GROUND FOR IMPUGNING THE AUTHORITY OF THE PRECEDENT. A PRECEDENT ON THE CONSTRUCTION OF A STATUTE IS AS MUCH BINDING AS ANY OTHER, AND THE FACT THAT IT WAS MISTAKEN IN ITS REASONING DOES NOT DESTROY ITS BINDING FORCE.' 43. IN CHOUDHRY BRO THERS' CASE , AS NOTICED ABOVE, THE DIVISION BENCH TREATED THE JUDGMENT IN CH. ATCHAIAH'S CASE , AS PER INCURIAM ON THE GROUND THAT THE EARLIER DIVISION BENCH DID NOT NOTICE THE SIGNIFICANT CHANGES THE CHARGING SECTION 3 HAS UNDERGONE BY THE OMISSION OF TH E WORDS 'OR 8 ITA NO S . 1501 & 1603/HYD/2017 THE PARTNERS OF THE FIRM OR THE MEMBERS OF THE ASSOCIATION INDIVIDUALLY' - . IN OUR VIEW, THIS CANNOT BE A GROUND TO TREAT AN EARLIER JUDGMENT AS PER INCURIAM. THE CHANGE IN THE PROVISIONS OF THE ACT WAS PRESENT IN THE MIND OF THE COURT WHICH DEC IDED CH. ATCHAIAH'S CASE . MERELY BECAUSE THE CONCLUSION ARRIVED AT ON CONSTRUING THE PROVISIONS OF THE CHARGING SECTION UNDER THE OLD ACT AS WELL AS UNDER THE NEW ACT DID NOT HAVE THE CONCURRENCE OF THE LATTER BENCH, THE EARLIER JUDGMENT CANNOT BE CALLED PER INCURIAM. 44. THOUGH A JUDGMENT RENDERED PER INCURIAM CAN BE IGNORED EVEN BY A LOWER COURT, YET IT APPEARS THAT SUCH A COURSE OF ACTION WAS NOT APPROVED BY THE HOUSE OF LORDS IN CASSELL AND CO. LTD. V. BROOME [1972] 1 ALL ER 801, WHEREIN THE HOUSE O F LORDS DISAPPROVED THE JUDGMENT OF THE COURT OF APPEAL TREATING AN EARLIER JUDGMENT OF THE HOUSE OF LORDS AS PER INCURIAM. LORD HAILSHAM OBSERVED (AT PAGE 809) : 'IT IS NOT OPEN TO THE COURT OF APPEAL TO GIVE GRATUITOUS ADVICE TO JUDGES OF FIRST INSTANC E TO IGNORE DECISIONS OF THE HOUSE OF LORDS IN THIS WAY.' 45. IT IS RECOGNISED THAT THE RULE OF PER INCURIAM IS OF LIMITED APPLICATION AND WILL BE APPLICABLE ONLY IN THE RAREST OF RARE CASES. THEREFORE, WHEN A LEARNED SINGLE JUDGE OR A DIVISION BENCH DOU BTS THE CORRECTNESS OF AN OTHERWISE BINDING PRECEDENT, THE APPROPRIATE COURSE WOULD BE TO REFER THE CASE TO A DIVISION BENCH OR FULL BENCH, AS THE CASE MAY BE, FOR AN AUTHORITATIVE PRONOUNCEMENT ON THE QUESTION INVOLVED AS INDICATED ABOVE. THE ABOVE - SAID T WO QUESTIONS ARE ANSWERED AS INDICATED ABOVE. 46. IN THE RESULT, THE QUESTIONS REFERRED TO US ARE ANSWERED ACCORDINGLY. WE CONCLUDE IN THIS FACTUAL AND LEGAL BACKDROP THAT THE ASSESSEES ARGUMENT SEEKING TO INCLUDE DEPB AS AN ADJUSTMENT FOR ALP COMPUT ATION BECAUSE IT IS IN THE NATURE OF AN OPERATING INCOME, OUGHT NOT BE ACCEPTED AS IT TENDS TO HAVE AN OVERRIDING EFFECT ON APPLICATION OF CHAPTER - X OF THE ACT AS PER STRICTER INTERPRETATION RULE. WE 9 ITA NO S . 1501 & 1603/HYD/2017 THEREFORE ACCEPT THE REVENUES INSTANT FORMER SUBSTANTIV E GRIEVANCE. 9.1. NEXT COMES LATTER ISSUE OF CORPORATE GUARANTEE ADJUSTMENT OF RS.3,51,06,335/ - DELETED IN THE CIT(A)S DETAILED DISCUSSION AS UNDER: 5.1 WITH REGARD TO ADJUSTMENT ON AMOUNT OF SHORTFALL IN CORPORATE GUARANTEE COMMISSION OF RS.3,51,06,33 5/ - , AFTER CONSIDERING THE SUBMISSIONS OF THE APPELLANT COMPANY AND ALSO BY FOLLOWING EARLIER ORDER IN THE APPELLANTS OWN CASE FOR THE AY.2011 - 12, WHEREIN I DECIDED THE ISSUE IN FAVOUR OF THE APPELLANT COMPANY BY OBSERVING THAT, THE TRANSFER PRICING OFFI CER HAD CHARGED CORPORATE GUARANTEE COMMISSION @ 2% WHICH IS HIGHER THAN THE APPELLANT CHARGED. SINCE THE APPELLANT HAS CHARGED A REASONABLE CORPORATE GUARANTEE COMMISSION I.E. @ 0.875% ARE MORE THAN THE TRIBUNALS ALLOWED. THEREFORE, THE ADDITION MADE BY T HE ASSESSING OFFICER IS HEREBY DELETED. THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFICER IS DELETED. 9.2. IT HAS COME ON RECORD THAT THE ASSESSEE HAD ITSELF RECORDED COMPARABLE GUARANTEE COMMISSION @8.75% I.E. MUCH MORE THAN THAT THAT DECIDED BY THE TRIBUNAL (SUPRA). WE THEREFORE ADOPT JUDICIAL CONSISTENCY AND DECLINE REVENUES INSTANT LATTER SUBSTANTIVE GROUND FOR THIS PRECISE REASON ALONE. NO OTHER ARGUMENT HAS BEEN RAISED BEFORE US. WE THUS ADOPT JUDICIAL CONSISTENCY TO ADOPT THE ABOVE EXTRACTED REASONING MUTATIS MUTANDIS TO AFFIRM THE CIT(A)S ACTION AFFIRMING THE IMPUGNED ALP ADJUSTMENT IN ASSESSEE'S APPEAL ITA 1501/HYD/2017 . 10 ITA NO S . 1501 & 1603/HYD/2017 4. NEXT COMES REVENUES CROSS APPEAL ITA 1603/HYD/2017. ITS FORMER SUBSTANTIVE GRIEVANCE IS THAT THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ASSESSEE'S EMPLOYEES CONTRIBUTION TO ESI / PF OF RS.12,281 MADE BY THE ASSESSING OFFICER IN H IS ASSESSMENT ORDER DT.24.04.2015 FOR THE SOLE REASON THAT THE SAME HAD BEEN DEPOSITED BEYOND THE DUE DATE PRESCRIBED UNDER CORRESPONDING STATUTE BUT BEFORE THAT OF FILING RETURN U/S. 139(1) OF THE ACT. SUFFICE TO SAY , THE ASSESSEES AND R EVENUES STAND S ARE THAT THE SAME HA D BEEN PAID BEFORE THE DUE DATE OF FILING SEC. 139(1) RETURN AND AFTER THE DUE DATE PRESCRIBED IN THE CORRESPONDING STATUTES; RESPECTIVELY. WE NOTICE IN THIS FACTUAL BACKDROP THAT THE LEGISLATURE HAS NOT ONLY INCORPORATED NECESSARY AMEN DMENTS IN SECTIONS 36(VA) AS WELL AS 43B VIDE FINANCE ACT, 2021 TO THIS EFFECT BUT ALSO THE CBDT HAS ISSUED MEMORANDUM OF EXPLANATION THAT THE SAME APPLIES W.E.F. 1.4.2021 ONLY. IT IS FURTHER NOT AN ISSUE THAT THE FORERGOING LEGISLATIVE AMENDMENTS HAVE PRO POSED EMPLOYERS CONTRIBUTIONS; DISALLOWANCES U/S 43B AS AGAINST EMPLOYEE U/S 36 (VA) OF THE ACT; RESPECTIVELY. 11 ITA NO S . 1501 & 1603/HYD/2017 HOWEVER, KEEPING IN MIND THE FACT THAT THE SAME HAS BEEN CLARIFIED TO BE APPLICABLE ONLY WITH PROSPECTIVE EFFECT FROM 1.4.2021, WE HOLD THAT THE IMPUGNED DISALLOWANCE IS NOT SUSTAINABLE IN VIEW OF ALL THESE LATEST DEVELOPMENTS EVEN IF THE REVENUES CASE IS SUPPORTED BY THE FOLLOWING CASE LAW. (I) CIT VS. MERCHEM LTD, [2015] 378 ITR 443(KER) (II) CIT VS. GUJARAT STATE ROAD TRANSPORT CORPORATION (2 014) 366 ITR 170 (GUJ.) (III) CIT VS. SOUTH INDIA CORPORATION LTD. (2000) 242 ITR 114 (KER) (IV.) CIT VS. GTN TEXTILES LTD. (2004) 269 ITR 282 (KER) (V) CIT VS. JAIRAM & SONS [2004] 269 ITR 285 (KER) THE IMPUGNED ESI/PF DISALLOWANCE IS DIRECTED TO BE D ELETED THEREFORE. WE THUS REJECT THE REVENUE S INSTANT FORMER SUBSTANTIVE GROUND. 5. THE REVENUES LATTER SUBSTANTIVE GRIEVANCE SEEKS TO REVIVE ITS TRANSFER PRICING OFFICER (TPO)S ACTION IN MAKING CORPORATE GUARANTEE ADJUSTMENT @ 2% COMMISSION AMOUNTING TO RS.2,60,85,150 AS AGAINST RS .7,78,97,731 AT THE ASSESSEE'S BEHEST @ 0.8 7 5%. WE FIND HEREIN AS WELL THAT THE TRIBUNALS ORDER (SUPRA) HAS ALREADY UPHELD THE CIT(A)S 12 ITA NO S . 1501 & 1603/HYD/2017 ACTION DELETING SIMILAR ALP ADJUSTMENT ON ASSESSEE'S CORPORATE GUARANTEE DECLARED @ 0.875% IN A.Y. 2013 - 14. NO DISTINCTION O N LAW AND FACTS H AS EMERGED DURING THE COURSE OF HEARING. W E THUS AFFIRM THE CIT(A)S LOWER APPELLATE ACTION UNDER CHALLENGE DELETING THE IMPUGNED CORPORATE GUARANTEE ADJUSTMENT. REVENUES APPEAL ITA 1063/HYD/201 7 IS ALSO REJECTED. NO OTHER GROUND HAS BEEN PRESSED BEFORE US. 6. TH IS ASSESSEE'S APPEAL ITA 1501/HYD/201 7 AND REVENUES CROSS APPEAL ITA 1603/HYD/201 7 CROSS APPEALS ARE DISMISSED IN ABOVE TERMS. A COPY OF THIS COMMON ORDER BE PLACED IN RESPECTIVE CASE FILES. ORDER PRONOUNCED IN THE OPEN COURT ON 29TH SEPT . , 2021. SD/ - SD/ - (L .P. SAHU) (S.S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DT. 29 .0 9 .2021. * REDDY GP 13 ITA NO S . 1501 & 1603/HYD/2017 COPY TO : 1. M/S. NAVA BHARAT VENTURES LIMITED, 6 - 3 - 1109/1, NAVABHARAT CHAMBERS, RAJ BHAVAN ROAD, SOMAJIGUDA, HYDERABAD - 500 082 2. ACIT, CIRCLE 16(1), HYDERABAD. /DCIT, CIRCLE 16(1), HYDERABAD. 3. PR. C I T - 4 , HYDERABAD. 4. CIT(APPEALS) - 4, HYDERABAD. 5. DR, ITAT, HYDERABAD. 6. GUARD FILE. BY ORDER SR. PVT. SECRETARY, ITAT, HYDERABAD.