MILLWARD BROWN MARKET RESEARCH SERVICES INDIA P.LTD, MUMBAI V. DCIT 10(2)(2), MUMBAI

ITA 2239/MUM/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 4412 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 30-03-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Transfer pricing; International transaction; TDS; Set aside; FORM 26AS
• Section: 271(1)(c); 92C; 143(3); 244A; 37(1); 10B; 13; 92CA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH J, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER ITA NO.2239/MUM/2017(A.Y.2012-13) MILLWARD BROWN MARKET RESEARCH SERVICES INDIA PRIVATE LIMITED, 702,7 TH FLOOR, ACKRUTI STAR, MIDC CENTRAL ROAD, NEXT TO MAROLE TELEPHONE EXCHANGE, ANDHERI (E) MUMBAI 400 093 ... .. APPELLANT VS. DY. COMMISSIONER OF INCOME TAX -10(2)(2), ROOM NO.209, 2 ND FLOOR, AAYKAR BHAVAN, M.K.ROAD, MUMBAI 400 020. PAN: AAFCM 3114M ...... RESPONDENT APPELLANT BY : SHRI M.P.LOHIA RESPONDENT BY : SHRI UODAL RAJ SI NGH DATE OF HEARING : 13/02/2020 DATE OF PRONOUNCEMENT : 18/02/2020 ORDER PER VIKAS AWASTHY, JM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ASSESSMENT ORDER DATED 31/01/2017 PASSED UNDER SECTION 143(3) R.W.S. 144C(13) OF THE INCOME TAX ACT, 1961( IN SHORT THE ACT). 2. SHRI M.P.LOHIA, APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THA T THE ASSESSEE IS ENGAGED IN PROVIDING RESEARCH BASED CON SULTANCY SERVICES IN BRAND BUILDING. THE ASSESSEE IS A SUBSIDIARY OF RUSSELL SQUARE HOLDING BV, NETHERLANDS. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED THAT 2 ITA NO.2239/MUM/2017(A.Y.2012-13) DURING THE PERIOD RELEVANT TO THE ASSESSMENT YEAR UNDER APPEAL THE ASSESSEE ENTERED INTO INTERNATIONAL TRANSACTIONS, WHICH WAS IDENTICAL TO THE TRANSACTION CARRIED OUT IN ASSESSMENT YEAR 2011-12. THE MANNE R OF BENCHMARKING OF THE INTERNATIONAL TRANSACTIONS IN THE IMPUGNED ASSESSME NT YEAR IS SIMILAR TO THE ONE MADE IN ASSESSMENT YEAR 2011-12. THE ASSESSEE HAD MADE PAYMENTS TO ITS ASSOCIATED ENTERPRISES (AES) TOWARDS INTRA GRO UP SERVICES TO THE TUNE OF RS.7.54 CRORES. THE TRANSFER PRICING OFFICER(TPO) H ELD THAT THE ASSESSEE HAS NOT BEEN ABLE TO SHOW SERVICES RENDERED AND THE BENEFIT DERIVED BY THE ASSESSEE FROM THE ALLEGED SERVICES. HENCE, THE TPO DETERMI NED THE ARMS LENGTH PRICE (ALP) OF THE SERVICES AT NIL. THE ASSESSEE FILED OBJECTIONS BEFORE DISPUTE RESOLUTION PANEL (DRP).THE DRP VIDE DIRECTIONS DAT ED 22/12/2016 REJECTED THE OBJECTION OF THE ASSESSEE AND UPHELD THE FINDI NGS OF TPO. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED THAT TPO IN PARA A3.3 AND 5 OF HIS ORDER DATED 25/01/2016 HAS CATEGORICALLY M ENTIONED THAT ADDITION ON SIMILAR GROUNDS FOR THE SAME TRANSACTIONS WERE MADE IN ASSESSMENT YEAR 2011-12 AND THE DRP HAD REJECTED THE OBJECTIONS OF THE ASSESSEE. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FURTHER POINTED THAT THE DRP IN PARA 4.2.18 OF THE DIRECTIONS HAS REITERATED THAT THE ISSUE HAD COME UP BEFORE THE PANEL IN THE PRECEDING YEAR ALSO, WHEREIN THE A CTION OF THE TPO IN DETERMINING ALP OF THE INTERNATIONAL TRANSACTION O F PROVISION OF CO-ORDINATION AND SUPPORT SERVICES AT NIL WAS UPHELD. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT THUS, THE ISSUE RAISED IN GROUND NO.4 TO 9 OF THE PRESENT APPEAL IS THE SAME WHICH WAS SUBJECT MATTER OF APPEAL BEFORE THE TRIBUNAL IN ITA NO.932/MUM/2016 IN ASSESSEES OWN C ASE IN ASSESSMENT YEAR 2011-12. THE TRIBUNAL VIDE ORDER DATED 08/01/2020 DELETED THE ADDITION BY PLACING RELIANCE ON THE DECISION OF HONBLE JURISD ICTIONAL HIGH COURT IN THE CASE 3 ITA NO.2239/MUM/2017(A.Y.2012-13) OF CIT VS. JOHNSON & JOHNSON LTD. IN INCOME TAX AP PEAL NO. 1030 OF 2014 DECIDED ON 07/03/2017. 3. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESS EE SUBMITTED THAT IN GROUND NO.10 TO 13 OF THE APPEAL, THE ASSESSEE HAS ASSAILED THE FINDINGS OF THE ASSESSING OFFICER IN NOT ALLOWING TDS CREDIT IN FU LL TO THE ASSESSEE. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE CONTENDE D THAT AS PER PROVISIONS OF SECTION 199 OF THE ACT, THE TDS CREDITED IS TO BE ALLOWED TO THE ASSESSEE IN THE YEAR IN WHICH INCOME IS OFFERED TO TAX. WHEREA S, THE ASSESSING OFFICER IN THE PRESENT CASE HAS ALLOWED TDS IN THE YEAR IN WH ICH IT HAS BEEN DEDUCTED. THIS HAS RESULTED IN MISMATCH OF TDS CLAIMED BY T HE ASSESSEE AND TDS CLAIM TDS REFLECTED IN FORM 26AS. THE LD. AUTHORIZED REP RESENTATIVE FOR THE ASSESSEE SUBMITTED THAT TDS DEDUCTED AND REFLECTED IN FORM 26AS ALSO INCLUDES RECEIPTS WHICH ARE OFFERED TO TAX BY THE A SSESSEE IN THE SUBSEQUENT ASSESSMENT YEARS. THE ASSESSEE HAS OFFERED SOME OF THE RECEIPTS IN SUBSEQUENT ASSESSMENT YEAR AS THEY HAVE BEEN ACTUALLY RECEIVE D IN LATER FINANCIAL YEAR. 4. IN RESPECT OF GROUND NO.15 & 16 RELATING TO SH ORT GRANT OF TDS CREDIT AND INTEREST UNDER SECTION 244A OF THE ACT, RESPECT IVELY, THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT ASSE SSEE HAS FILED RECTIFICATION PETITION BEFORE THE ASSESSING OFFICER. THE SAME IS STILL PENDING FOR THE FINAL DISPOSAL. THE LD. AUTHORIZED REPRESENTATIVE FOR TH E ASSESSEE PRAYED THAT DIRECTION MAY BE GIVEN TO ASSESSING OFFICER TO DISP OSE OF THE APPLICATION IN TIME BOUND MANNER. 5. SHRI UODAL RAJ SINGH, REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE ASSESSMENT ORDER AND THE DIRECTIONS OF THE DRP. HOWEVER, THE LD. DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT T HE ISSUE RAISED IN GROUND 4 ITA NO.2239/MUM/2017(A.Y.2012-13) NO.4 TO 9 OF THE APPEAL BY THE ASSESSEE IS SIMILAR TO THE ONE ADJUDICATED BY THE TRIBUNAL IN ASSESSSEES OWN CASE IN ASSESSMENT YEAR 2011-12. 6. WE HAVE HEARD THE SUBMISSIONS MADE BY RIVAL SIDE S AND HAVE PERUSED ORDERS OF AUTHORITIES BELOW. THE ASSESSEE IN APPEA L HAS RAISED AS MANY AS 17 GROUNDS. THE GROUND NO.1 TO 3 ARE GENERAL IN NATUR E, HENCE, REQUIRES NO ADJUDICATION. 7. THE GROUND NO.4 TO 9 OF THE APPEAL ARE IN RESPE CT OF A SINGLE ISSUE ASSAILING THE METHOD OF BENCHMARKING INTERNATIONA L TRANSACTIONS ENTERED INTO BY THE ASSESSEE WITH IT ASSOCIATED ENTERPRISE (AE) IN THE PERIOD RELEVANT TO THE ASSESSMENT YEAR UNDER APPEAL. THE ASSESSEE HAD MAD E PAYMENT TOWARDS ALLOCATION OF OPERATIONAL EXPENSES. THE ASSESSEE P AID RS.3.95 CRORES TO ITS AE MILLWARD BROWN INC(GLOBAL HUB) AND RS.3.59 CRORES TO MILLWARD BROWN SINGAPORE (REGIONAL HUB) IN LIEU OF CERTAIN INTRA GROUP SERVICES. THE ASSESSEE SELECTED AE AS TESTED PARTY AND SELECTED 16 COMPANI ES AS COMPARABLE TO BENCHMARK THE TRANSACTION. THE AE CHARGED 10% MARK -UP ON DIRECT AND INDIRECT COST FOR RENDERING GLOBAL SERVICES. THE ASSESSEE APPLIED TRANSACTIONAL NET MARGIN METHOD (TNMM) AS MOST APPROPRIATE METHOD TO BENCHMARK ITS INTERNATIONAL TRANSACTION. THE TPO REJECTED THE BE NCHMARKING OF THE ASSESSEE. THE TPO HELD THAT THE ASSESSEE HAS FAILED TO PRO VIDE EXACT COST INCURRED FOR EACH SERVICES. THE TPO FURTHER POINTED THAT THE A SSESSEE HAS NOT BEEN ABLE TO SUBSTANTIATE THE BENEFIT DERIVED FROM THE SERVICES RENDERED AND HENCE, DETERMINED ALP OF THE GLOBAL SERVICES AND THE RE GIONAL SERVICES AT NIL. THE DRP UPHELD THE FINDINGS OF TPO. 8. WE FIND THAT IN THE IMMEDIATELY PRECEDING ASSES SMENT YEAR I.E. ASSESSMENT YEAR 2011-12 THE ASSESSEE HAD MADE PAYM ENTS TO THE SAME AES 5 ITA NO.2239/MUM/2017(A.Y.2012-13) FOR PROVIDING SIMILAR INTRA-GROUP SERVICES. THE FAC T THAT NATURE OF THE TRANSACTION AND SERVICES PROVIDED WERE SIMILAR IN A SSESSMENT YEAR 2011-12 AND 2012-13 IS EVIDENT FROM THE OBSERVATIONS OF T HE TPO IN PARA A 3.3 AND PARA 5 OF THE ORDER DATED 25/01/2016. THE DRP HAS ALSO RECONFIRMED IN ITS DIRECTIONS THAT THE NATURE OF INTERNATIONAL TRANSAC TION IN THE PRECEDING ASSESSMENT YEAR IS SIMILAR. THE ASSESSEE IN ASS ESSMENT YEAR 2011-12 CARRIED THE ISSUE IN APPEAL TO THE TRIBUNAL IN ITA NO.932 /MUM/2016(SUPRA). THE TRIBUNAL DELETED THE ADDITION BY HOLDING AS UNDER:- 8. AGAINST THE ABOVE ASSESSEE IS IN APPEAL BEFORE US. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. LEARNED COUNSEL OF THE ASSESSEE SUBMITTED THAT THE TRANSFER PRICING OFFICER HAS DETERMINED THE ARMS LE NGTH PRICE OF THE INTERNATIONAL TRANSACTION IN THIS CASE TO BE NIL, WITHOUT APPLYIN G ANY METHOD WHATSOEVER. HE SUBMITTED THAT ASSESSEE HAS SUBMITTED VOLUMINOUS DO CUMENT SHOWING THE SERVICES HOWEVER THEY HAVE BEEN SUMMARILY DISMISSED ON THE G ROUND THAT THE BENEFIT ACCRUING TO THE ASSESSEE HAS NOT BEEN ESTABLISHED. THE LEARNED COUNSEL OF THE ASSESSEE SUBMITTED THAT THIS APPROACH IS NOT AT ALL SUSTAINABLE. HE REFERRED TO THE DECISION OF HONOURABLE JURISDICTIONAL HIGH COURT IN THIS REGARD FOR THE PROPOSITION THAT IT IS NOT FOR THE TRANSFER PRICING OFFICER TO APPLY THE BENEFIT TEST UNDER SECTION 37(1) OF THE I.T. ACT, BUT THE SAME IS FOR THE ASSESSING OFF ICER. WE FIND THAT THE RATIO FROM THE ABOVE HONOURABLE DURING HIGH COURT DECISION IS QUIT E CLEAR. HENCE ADMITTEDLY THE TRANSFER PRICING OFFICER HAS EXCEEDED HIS JURISDICT ION. HENCE THE TRANSFER PRICING OFFICER'S PROPOSITION THAT THE DOCUMENTS SUBMITTED BY THE ASSESSEE DO NOT PROVIDE THE BENEFIT OBTAINED BY THE ASSESSEE AND HENCE THEY HAVE TO BE REJECTED AND ARM'S- LENGTH PRICE IS TO BE DETERMINED AS NIL IS NOT AT A LL SUSTAINABLE. THE LEARNED DEPARTMENTAL REPRESENTATIVE IN THIS REGARD COULD NO T SUBMIT ANYTHING AGAINST THE PROPOSITION THAT TRANSFER PRICING OFFICER HAS ERRED IN APPLYING THE BENEFIT TEST. IN THIS VIEW OF THE MATTER IN OUR CONSIDERED OPINION AUTHOR ITIES BELOW HAVE TOTALLY ERRED IN REJECTING THE ASSESSEE'S DOCUMENTS AND SUBMISSIONS ON THE GROUND THAT THEY DO NOT PROVE THE BENEFIT OBTAINED BY THE ASSESSEE. THAT TH E SERVICES HAVE BEEN RENDERED IS VERY MUCH EVIDENT FROM THE DOCUMENTS SUBMITTED TO T HE AUTHORITIES BELOW. THE ASSIGNMENT TO THE TPO WAS TO BENCHMARK THE INTERNAT IONAL TRANSACTION AND COMPUTE THE ARMS LENGTH PRICE. INSTEAD OF PERFORMING HIS S TATUTORY DUTIES THE TPO SAT INTO THE SHOES OF THE ASSESSING OFFICER AND REJECTED THE DOC UMENTS ON THE GROUND THAT THEY DO NOT PROVE THE BENEFIT TEST. THIS ACTION HAS BEEN UP HELD BY THE DRP. THIS APPROACH IS NOT SUSTAINABLE. 9. FURTHERMORE, WE ALSO NOTE THAT SUBMISSION OF LEA RNED COUNSEL OF THE ASSESSEE IS ALSO CORRECT THAT THE AUTHORITIES BELOW HAVE SUM MARILY REJECTED THE ASSESSEES CLAIM WITHOUT APPLYING ANY METHOD OF BENCHMARKING I NTERNATIONAL TRANSACTION AS 6 ITA NO.2239/MUM/2017(A.Y.2012-13) SPECIFIED IN SECTION 92C OF THE ACT. IN THIS REGARD WE NOTE THAT SECTION 92C PROVIDES THAT FOLLOWING METHOD OF BENCHMARKING OF INTERNATIO NAL TRANSACTION. 92C. (1) THE ARMS LENGTH PRICE IN RELATION TO AN I NTERNATIONAL TRANSACTION OR SPECIFIED DOMESTIC TRANSACTION SHALL BE DETERMINED BY ANY OF THE FOLLOWING METHODS, BEING THE MOST APPROPRIATE METHOD, HAVING REGARD TO THE NATURE OF TRANSACTION OR CLASS OF TRANSACTION OR CLASS OF ASS OCIATED PERSONS OR FUNCTIONS PERFORMED BY SUCH PERSONS OR SUCH OTHER RELEVANT FA CTORS AS THE BOARD MAY PRESCRIBE, NAMELY : (A) COMPARABLE UNCONTROLLED PRICE METHOD; (B) RESALE PRICE METHOD; (C) COST PLUS METHOD; (D) PROFIT SPLIT METHOD; (E) TRANSACTIONAL NET MARGIN METHOD; (F) SUCH OTHER METHOD AS MAY BE PRESCRIBED BY THE B OARD. 10. IT IS TO BE FURTHER NOTED THAT RULE 10B OF INCO ME TAX RULES, 1962 (FOR SHORT 'THE RULES'), PROVIDES THE MECHANISM FOR DETERMINAT ION OF ARM'S LENGTH PRICE UNDER THE AFORESAID METHODS PRESCRIBED UNDER SECTION 92C OF THE ACT. IF THE ASSESSING OFFICER IN COURSE OF ASSESSMENT PROCEEDINGS FINDS T HAT THE ASSESSEE HAS ENTERED INTO INTERNATIONAL TRANSACTIONS WITH ITS AE, HE MAY WITH THE PREVIOUS APPROVAL OF THE AUTHORITY CONCERNED MAKE A REFERENCE TO THE TRANSFE R PRICING OFFICER UNDER SECTION 92CA(1) OF THE ACT TO COMPUTE THE ARM'S LENGTH PRIC E OF THE INTERNATIONAL TRANSACTION BY APPLYING ANY OF THE METHODS PRESCRIBED UNDER S ECTION 92C OF THE ACT. AFTER RECEIVING SUCH A REFERENCE FROM THE ASSESSING OFFIC ER, THE TRANSFER PRICING OFFICER IS REQUIRED TO DETERMINE THE ARM'S LENGTH PRICE OF THE INTERNATIONAL TRANSACTION AS PER THE PROVISIONS CONTAINED UNDER SECTION 92C AND 92CA OF THE ACT READ WITH RELEVANT RULES. THUS, AS COULD BE SEEN FROM THE READING OF T HE AFORESAID PROVISIONS, THE DUTY OF THE TRANSFER PRICING OFFICER IS RESTRICTED ONLY TO THE DETERMINATION OF ARM'S LENGTH PRICE OF AN INTERNATIONAL TRANSACTION BETWEEN TWO R ELATED PARTIES BY APPLYING ANY OF THE METHODS PRESCRIBED UNDER SECTION 92C OF THE ACT R/W RULE 10B OF THE RULES. THUS, THERE IS NO PROVISION UNDER THE ACT EMPOWERING THE TRANSFER PRICING OFFICER TO DETERMINE THE ARM'S LENGTH PRICE ON ESTIMATION BASI S (WHICH IN THIS CASE IS NIL), THAT TOO, BY ENTERTAINING DOUBTS WITH REGARD TO THE BUSI NESS EXPEDIENCY OF THE PAYMENT AND IN THE PROCESS STEPPING INTO THE SHOES OF THE A SSESSING OFFICER FOR MAKING DISALLOWANCE UNDER SECTION 37(1) OF THE ACT. THIS, IN OUR CONSIDERED OPINION, IS NOT IN CONFORMITY WITH THE STATUTORY PROVISION, HENCE, UNA CCEPTABLE. THE TRANSFER PRICING OFFICER IS DUTY BOUND TO DETERMINE THE ARM'S LENGTH PRICE OF THE INTERNATIONAL TRANSACTION BY ADOPTING ONE OF THE METHOD PRESCRIBE D UNDER THE STATUTE AND CANNOT DEVIATE FROM THE RESTRICTIONS/CONDITIONS IMPOSED UN DER THE STATUTE. THE HON'BLE JURISDICTIONAL HIGH COURT IN CIT VS. JOHNSON & JOHN SON LTD., ITA NO. 1030/2014, DATED 7TH MARCH 2017, WHILE DEALING WITH IDENTICAL ISSUE OF DETERMINATION OF ARM'S LENGTH PRICE OF ROYALTY BY RESORTING TO ESTIMATION BY THE TRANSFER PRICING OFFICER HAS HELD AS UNDER:- 7 ITA NO.2239/MUM/2017(A.Y.2012-13) '(D) WE FIND THAT THE IMPUGNED ORDER OF THE TRIBUNA L UPHOLDING THE ORDER OF THE CIT(A) IN THE PRESENT FACTS CANNOT BE FOUND FAU LT WITH. THE TPO IS MANDATED BY LAW TO DETERMINE THE ALP BY FOLLOWING O NE OF THE METHODS PRESCRIBED IN SECTION 92C OF THE ACT READ WITH RULE 10B OF THE INCOME TAX RULES. HOWEVER, THE AFORESAID EXERCISE OF DETERMINI NG THE ALP IN RESPECT OF THE ROYALTY PAYABLE FOR TECHNICAL KNOWHOW HAS NOT B EEN CARRIED OUT AS REQUIRED UNDER THE ACT. FURTHER, AS HELD BY THE CIT (A) AND UPHELD BY THE IMPUGNED ORDER OF THE TRIBUNAL, THE TPO HAS GIVEN N O REASONS JUSTIFYING THE TECHNICAL KNOW-HOW ROYALTY PAID BY THE ASSESSING OF FICER TO ITS ASSOCIATED ENTERPRISE BEING RESTRICTED TO 1% INSTEAD OF 2%, AS CLAIMED BY THE RESPONDENT ASSESSEE. THIS DETERMINATION OF ALP OF T ECHNICAL KNOWHOW ROYALTY BY THE TPO WAS AD-HOC AND ARBITRARY AS HELD BY THE CIT(A) AND THE TRIBUNAL. 11. WE FIND THAT RATIO FROM THE ABOVE HON'BLE JURIS DICTIONAL HIGH COURT DECISION IS SQUARELY APPLICABLE HERE. HENCE TRANSFER PRICING AD JUSTMENT AT NIL FAILS ON BOTH COUNTS. FIRSTLY ON THE ACCOUNT OF BENEFIT TEST WHIC H IS NOT TO BE APPLIED BY THE TPO AND SECONDLY NONE OF THE METHOD OF BENCHMARKING THE INTERNATIONAL TRANSACTION AS SPECIFIED IN SECTION 92C HAS BEEN APPLIED. 12. ACCORDINGLY, WE SET ASIDE THE ORDERS OF THE AUT HORITIES BELOW DETERMINING ARMS LENGTH PRICE AT NIL AND DECIDE THE ISSUE IN FA VOUR OF THE ASSE SSEE SINCE THE FACTS IN THE ASSESSMENT YEAR UNDER APP EAL ARE SIMILAR TO THE ONE ADJUDICATED BY CO-ORDINATE BENCH OF THE TRIBUNA L IN ASSESSEES OWN CASE IN ASSESSMENT YEAR 2011-12, WE SEE NO REASON TO TA KE A DIFFERENT VIEW. RESPECTFULLY FOLLOWING THE DECISION OF CO-ORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE, WE ALLOW GROUND NO.4 TO 9 OF THE APPEAL IN SIMILAR TERMS. 9. IN GROUND NO.10 TO 13 OF THE APPEAL, ASSESSEE HA S ASSAILED DISALLOWANCE OF TDS CREDIT. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER ASKED THE ASSESSEE TO RECONCILE THE PAYMENTS RECEIVED AND THE TDS REFLECTED IN FORM 26AS. THE ASSESSEE FURNISHED DETAILS OF THE TRANSA CTIONS AND EXPLAINED THAT DIFFERENCE IN REVENUE RECOGNIZED IN THE BOOKS OF AC COUNT AND THE TDS REFLECTED IN FORM 26AS IS ON ACCOUNT OF DIFFERENCE BETWEEN TH E PERIOD OF RECOGNITION OF PROFIT AND THE AMOUNT RECEIVED. THE LD.AUTHORIZED REPRESENTATIVE OF THE 8 ITA NO.2239/MUM/2017(A.Y.2012-13) ASSESSEE PLACED RELIANCE ON THE PROVISIONS OF SECTI ON 199 TO CONTEND THAT THE TDS CREDIT BE GIVEN TO THE ASSESSEE IN THE YEAR IN WHICH THE INCOME IS OFFERED TO TAX. THE LD.AUTHORIZED REPRESENTATIVE OF THE AS SESSEE POINTED THAT TDS REFLECTED IN FORM 26AS IN RESPECT OF CERTAIN PAYME NTS HAS BEEN OFFERED TO TAX BY THE ASSESSEE IN SUBSEQUENT ASSESSMENT YEARS AS T HE PAYMENT WAS ACTUALLY RECEIVED BY THE ASSESSEE DURING THE LATER ASSESSMEN T YEAR. AFTER CONSIDERING THE SUBMISSIONS OF LD.AUTHORIZED REPRESENTATIVE O F THE ASSESSEE WE DEEM IT APPROPRIATE TO RESTORE THIS ISSUE BACK TO THE FILE OF ASSESSING OFFICER. THE ASSESSING OFFICER IS DIRECTED TO GRANT TDS CREDIT T O THE ASSESSEE IN THE YEAR IN WHICH THE ASSESSEE HAS RECEIVED THE INCOME AND HAS OFFERED THE SAME TO TAX. THUS, GROUND NO.10 TO 13 OF THE APPEAL ARE ALLOWED FOR STATISTICAL PURPOSE IN THE TERMS AFORESAID. 10. THE GROUNDS NO. 15 AND 16 ARE RELATING TO GRAN T OF TDS CREDIT RS.98,92,295/- AND GRANT OF INTEREST UNDER SECTION 244A, RESPECTIVELY. THE LD.AUTHORIZED REPRESENTATIVE OF THE ASSESSEE POINTE D THAT RECTIFICATION PETITION HAS ALREADY BEEN FILED BEFORE THE ASSESSING OFFICER AND THE SAME IS STILL PENDING FOR THE DISPOSAL. THE ASSESSING OFFICER I S DIRECTED TO DISPOSE OF THE RECTIFICATION PETITION FILED BY THE ASSESSEE EXPEDI TIOUSLY, PREFERABLY WITHIN A PERIOD OF THREE MONTHS FROM THE DATE OF RECEIPT OF THIS ORDER. THE GROUNDS NO.15 & 16 OF THE APPEAL IS THUS ALLOWED FOR STATIS TICAL PURPOSE IN THE TERMS AFORESAID. 11. IN GROUND NO.17 OF THE APPEAL, THE ASSESSEE HAS ASSAILED INITIATION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. THE GR OUND RAISED BY THE ASSESSEE IS PREMATURE AT THIS STATE, THE SAME IS DISMISSED, ACCORDINGLY. 9 ITA NO.2239/MUM/2017(A.Y.2012-13) 12. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED IN THE TERMS AFORESAID. ORDER PRONOUNCED IN THE OPEN COURT ON TUESDAY THE 18 TH DAY OF FEBRUARY, 2020. SD/- SD/- (MANOJ KUMAR AGGARWAL) (VI KAS AWASTHY) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 18/02/2020 VM , SR. PS(O/S) COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI