DST Worldwide Services India Private Limited, Hyderabad, Hyderabad V. Asst. Commissioner of Income Tax, Circle-17(1), Hyderabad, Hyderabad

ITA 1979/Hyd/2017

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 8455 (ITAT-HYDERABAD)
• Duration Of Justice: 3 year(s) 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-11-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2013-2014
• Appeal Filed On: 30-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y.V.S.T. SAI
• Assessee Lawyers: KIRESH SHIVKAR
• Section: 92B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B” : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER I.T.A. No.1979/HYD/2017 Assessment Year: 2013-14 DST Worldwide Services India Private Limited, HYDERABAD [PAN: AAACI7097L] Vs Assistant Commissioner of Income Tax, Circle-17(1), HYDERABAD (Appellant) (Respondent) For Assessee : Shri Kiresh Shivkar, AR For Revenue : Shri Y.V.S.T.Sai, CIT-DR Date of Hearing : 28-09-2021 Date of Pronouncement : 16-11-2021 O R D E R PER S.S.GODARA, J.M. : This assessee’s appeal for AY.2013-14 arises against the ACIT, Circle-17(1), Hyderabad’s assessment, dated 28-09-2017 framed in furtherance to the Dispute Resolution Panel (‘DRP’)- 1, Bengaluru’s directions dt.22-08-2017 in F.No.291/DRP-1/ BNG/2016-17, involving proceedings u/s.143(3) r.w.s.92CA(3) and 144C(13) of the Income Tax Act, 1961 [in short, ‘the Act’]. Heard both the parties. Case file perused. 2. It transpires at the outset that the assessee’s instant appeal suffers from four days’ delay stated to be attributable to the reason(s) beyond his control as per condonation petition/affidavit. No rebuttal has come from the departmental side. The impugned delay is condoned therefore. ITA No.1979/Hyd/2017 :- 2 -: 3. We notice at the outset that there is hardly any need for us to delve much deeper so far as the assessee’s sole substantive grievance challenging Arm’s Length Price (ALP) adjustment pertaining to interest on receivables of Rs.16,82,292/-; is concerned. We make it clear first of all that such interest on receivables indeed forms an international transaction as per Section 92B explanation (c) of the Act inserted by the Finance Act, 2012 with retrospective effect from 01-04-2002. The fact however remains that the Transfer Pricing Officer’s (TPO’s) order herein dt.30-09-2016 in para 7.5 page 4 has proposed impugned adjustment as per the assessee’s service agreements with its Associated Enterprise (AE) only stipulating thirty days credit period from the date of invoice. It is therefore clear that the learned lower authorities have adopted the assessee’s AE’s only as a benchmarking comparable(s) which is not sustainable in law as per Tehnimont ICB Pvt. Ltd. Vs. Addl.CIT (2012) 138 ITD 33 (Mum) (TM) and Sabic Innovative Plastics India Pvt. Ltd. Vs. DCIT (2013) 59 SOT 138 (Ahd) holding that such an arrangement lacks uncontrolled transaction. We therefore direct the Assessing Officer to delete the impugned ALP adjustment of Rs.16,82,292/- for this precise reason alone. All other arguments on merits are rendered infructuous. 4. This assessee’s appeal is allowed in above terms. Order pronounced in the open court on 16 th November, 2021 Sd/- Sd/- (LAXMI PRASAD SAHU) (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Hyderabad, Dated: 16-11-2021 TNMM ITA No.1979/Hyd/2017 :- 3 -: Copy to : 1.DST Worldwide Service India Private Limited, 5 th Floor, Block-B, Q City, Nanakramguda, Serilingampally (M), Gachibowli, Hyderabad. 2.The Assistant Commissioner of Income Tax, Circle-17(1), Hyderabad. 3.Dispute Resolution Panel (DRP)-1, Bengaluru. 4.Director of Income Tax (IT & TP), Hyderabad. 5.Addl. Commissioner of Income Tax (Transfer Pricing), Hyderabad. 6.D.R. ITAT, Hyderabad. 7. Guard File.