ACIT CIR 6(2), MUMBAI V. DIAMOND DYE CHEM LTD, MUMBAI

ITA 2493/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 48651 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-04-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2004-2005
• Appeal Filed On: 30-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUM EET KUMAR
• Keywords: Transfer pricing

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH D, MUMBAI BEFORE SHRI P.M. JAGTAP AND SHRI R.S. PADVEKAR, JM I.T.A.NO.2493/MUM/2010 ASSESSMENT YEAR: 2004-05 THE ASST. COMMISSIONER OF INCOME- TAX, CIRCLE 6(2), R.NO. 563, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI 400 020. VS. M/S. DIAMOND DYE CHEM. LTD., BUILDING NO.3, CIBA RESEARCH CENTRE, OFF. AAREY ROAD, GOREGAON, MUMBAI 400 063. PAN : AAACD 3478 N (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUMEET KUMAR RESPONDENT BY : S/SHRI KANCHAN KAUSHAL & DHANESH BA FNA O R D E R PER P.M. JAGTAP, AM: THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST TH E ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX(APPEALS)-15, MUMBAI, DAT ED 29.01.2010 FOR THE ASSESSMENT YEAR 2004-05, WHEREBY HE DIRECTED THE AS SESSING OFFICER TO GIVE A FURTHER DEDUCTION OF 5% OF ARMS LENGTH PRICE IN VI EW OF PROVISO TO SECTION 92C(2). 2. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS OBSERVED THAT A SIMILAR ISSUE HAD COME UP FOR CONSIDERATION BEFORE THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2002-03 AND VIDE PARA NO.8 OF ITS ORDER DATED 27 TH JANUARY, 2010 PASSED IN ITA NO.3342/MUM/2006, THE T RIBUNAL DECIDED THE SAME IN FAVOR OF THE ASSESSEE BY OBSERVING AS UNDER: COMING TO GROUND NO 3 WHICH IS ON THE ISSUE OF ADJ USTMENT MADE TO ARMS LENGTH PRICE UNDER TRANSFER PRICING REGULATIONS, TH E GRIEVANCE OF THE REVENUE IS THAT THE CIT(A) DIRECTED THE AO TO GRANT A REDUCTION OF 5% FROM THE ARMS LENGTH PRICE IN VIEW OF THE PROVISO TO SECTION 92C(2). THE LEARNED DR, THOUGH NOT LEAVING HIS GROUND, ULTIMATE LY SUBMITTED THAT IN VIEW OF THE CBDT CIRCULAR ON THE ISSUE, IF THE VARI ATION IS LESS THAN 5% BEING ARMS LENGTH PRICE DETERMINED BY THE ITO AND THE ARMS LENGTH PRICE DETERMINED BY THE ASSESSEE, NO ADJUSTMENT IS CALLED FOR IN VIEW OF THE ABOVE SUBMISSION, WE DISMISS GROUND NO.3 OF THE REV ENUE. 3. AS THE ISSUE INVOLVED IN THE YEAR UNDER CONSIDER ATION IS SIMILAR TO THAT OF ASSESSMENT YEAR 2002-03, WE RESPECTFULLY FOLLOW THE DECISION OF THE TRIBUNAL ITA NO.2493/M/2010 M/S. DIAMOND DYE CHEM. LTD. 2 RENDERED IN THE ASSESSMENT YEAR 2002-03 AND UPHOLD THE IMPUGNED ORDER OF THE LEARNED CIT(A) GIVING RELIEF TO THE ASSESSEE ON THI S ISSUE. 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS _27 TH DAY OF APRIL, 2011. SD/ SD/ (R.S. PADVEKAR) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED THE 27 TH APRIL, 2011. KN COPY TO: 1. THE ASSESSEE 2. THE REVENUE 3. THE CIT-6, MUMBAI. 4. THE CIT(A)-15, MUMBAI 5. THE DR D BENCH, MUMBAI BY ORDER /TRUE COPY/ ASST. REGISTRAR, ITAT, MUMBAI