CHIRON BEHRING VACCINES P.LTD, MUMBAI V. ADDL CIT RG 8(1), MUMBAI

ITA 2637/MUM/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8992 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-11-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: K
• Assessment Year: 2008-2009
• Appeal Filed On: 07-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V JENARDHANAN
• Assessee Lawyers: ABHISHEK TILAK
• Keywords: Transfer pricing; Opportunity of being heard; International transaction; Additional evidence; Revised return
• Section: 143(3)

Judgement Text

, INCOME-TAX APPELLATE TRIBUNAL -KBENCH MUMBAI , , , BEFORE S/SHRI RAJENDRA,ACCOUNTANT MEMBER AND RAM LAL NEGI,JUDICIAL MEMBER ./I.T.A./2637/MUM/2015, /ASSESSMENT YEAR: 2008-09 M/S.CHIRON BEHRING VACCINES PRIVATE LIMITED,1 ST FLOOR, GSK HOUSE 252, DR. ANNIE BESANT ROAD, WORLI MUMBAI-400 030. PAN:AAACC 6494 P VS. ACIT-RANGE-8(1) AAYAKAR BHAVAN MUMBAI-400 020. ( /APPELLANT ) ( / RESPONDENT ) ./I.T.A./3956/MUM/2015, /ASSESSMENT YEAR: 2008-09 ACIT-RANGE-8(1) MUMBAI-400 020. VS. M/S.CHIRON BEHRING VACCINES PRIVATE LIMITED,MUMBAI-400 030. ( /APPELLANT ) ( / RESPONDENT ) REVENUE BY: SHRI V. JENARDHANAN-CIT-DR ASSESSEE BY: S/SHRI KAMAL SAWHNEY & ABHISHEK TILAK / DATE OF HEARING: 08.09.2017 / DATE OF PRONOUNCEMENT: 03.11.2017 ,1961 254(1) ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA, AM - CHALLENGING THE ORDER DATED 11/02/15 OF CIT(A)-55, MUMBAI THE ASSESSEE AND THE ASSESSING OFFICER(AO)HAVE FILED CROSS APPEALS FOR THE YEAR UN DER CONSIDERATION. ASSESSEE IS A JOINT VENTURE BETWEEN NOVARTIS VACCINES AND DIAGNOSTIC IN C. AND AVENTIS PHARMA LTD. HAVING 51 AND 49% SHARES RESPECTIVELY.IT IS ENGAGED IN THE BU SINESS OF MANUFACTURING OF RABIES VACCINE AND FILED ITS ORIGINAL RETURN OF INCOME ON 30/09/20 08,DECLARING TOTAL INCOME OF RS.30.15 CRORES.LATER ON, A REVISED RETURN WAS FILED ON 18/0 3/2010 DECLARING TOTAL INCOME OF RS.29.99 CRORES. 2. DURING THE ASSESSMENT PROCEEDINGS,THE AO FOUND THAT THE ASSESSEE HAD ENTERED INTO INTER - NATIONAL TRANSACTIONS(ITS)WITH ITS ASSOCIATED ENTER PRISE(AE).HE MADE A REFERENCE TO TPO TO DETERMINE THE ARMS LENGTH PRICE(ALP) OF THE TRANSA CTIONS.AFTER RECEIVING TPOS ORDER,HE PASSED AN ORDER U/S. 143(3) R.W.S. 144C(3) OF THE A CT,ON 19/01/2012 ,DETERMINING THE INCOME OF ASSESSEE AT RS.49.43 CRORES. ITA/2637/MUM/2015 2. EFFECTIVE GROUND OF APPEAL,RAISED BY THE ASSESSEE,I S ABOUT ADDITION OF RS.5.55 CRORES. DURING THE TO PROCEEDINGS THE TPO FOUND THAT THE AS SESSEE HAD FOLLOWING INTERNATIONAL TRANSACTIONS (IT.S)DURING THE YEAR UNDER APPEAL:- 2637/M/15 AND 3956/M/15- M/S. CHIRON BEHRING VACCINES PVT.LTD. 2 SN. TRANSACTION AMOUNT FOE AY.2008-09 METHOD ADOPTED AMOUNT FOR A.Y. 2007-08 METHOD ADOPTED 1. IMPORT OF SEED VIRUS 105,833,650/- TNMM 49,383,3 84/- TNMM 2. SALE OF VACCINES 149,565,869/- TNMM 153,800,006/ - TNMM 3. PAYMENT OF ROYALTY 33,018,641/- TNMM 39,759,446/ - TNMM 4. REIMBURSEMENT OF EXPENSES 3,231,218/- TNMM 1,900 ,539/- AT COST 5. RECOVERY OF EXPENSES 377,751/- AT COST - AT COST TOTAL 292,027,129/- 244,843,375/- HE FOUND THAT THE ASSESSEE HAD USED TNMM AS THE MO ST APPROPRIATE METHOD TO DETERMINE THE ALP OF EXPORT OF VACCINES, THAT IT HAD EARNED A NET COST PLUS MARGIN OF 50.33% ON AN OVERALL BASIS FROM ITS BUSINESS,THAT ON STAND LONE BASIS T HE NET COST PLUS MARGIN WAS 15.78% FROM THE EXPORT OF SALES TO AE , THAT THE ARITHMETIC MEAN OF WEIGHTED AVERAGE NET COST PLUS MARGIN WAS 13.44%, THAT IT HAD CLAIMED THAT TRANSACTION WAS AT ARMS LENGTH.THE TPO COMPARED MARGINS EARNED BY THE ASSESSEE FROM SALE OF VACCINE IN DOM ESTIC MARKET TO ITS OWN RELATED PARTY WITH THE MARGINS EARNED BY THE ASSESSEE FROM EXPORT OF V ACCINES TO ITS AE.HE ARRIVED AT THE MARGIN OF 60.54% AND ACCORDINGLY MADE ADJUSTMENT IN RESPE CT OF EXPORT SALES.HE HELD THAT THE ASSESSEE HAD NOT GIVEN DETAILS OF RESALE PRICE BY AE IN EUROPEAN MARKET TO DETERMINE THE GP MARGIN BY THE AE TO APPLY RESALE PRICE METHOD TO DE TERMINE THE ALP OF EXPORT OF VACCINES. FINALLY,HE RECOMMENDED AN UPWARD ADJUSTMENT OF RS.5 ,55,31,317/-. 3. AGGRIEVED BY THE ORDER OF THE AO,THE ASSESSEE PREFE RRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY(FAA)AND MADE DETAILED SUBMISSIO N IN THAT REGARD. IT ALSO FILED ADDITIONAL EVIDENCES DURING THE APPELLATE PROCEEDINGS,VIDE IT S LETTER DTD.18.6.13,TO SUBSTANTIATE ITS CLAIM FOR ARMS LENGTH PRICE OF EXPORT OF VACCINES BY WAY OF EXTERNAL BENCH MARKING ANAYLSIS FOR VACCINES.IT WAS MENTIONED THAT THE ANALYSIS WAS IN ACCORDANCE WITH DIRECTIONS OF THE TRIBUNAL THAT WERE PASSED BY IT WHILE ADJUDICATING THE APPEA L FOR AY 2002-03.THE FAA REFERRED TO THE EARLIER ORDER OF THE TRIBUNAL AND THE ORDER OF HIS PREDECESSOR DT.11/05/12 AND HELD THAT THERE WAS NO MERIT IN THE CASE OF THE ASSESSEE.THUS,CONFI RMING THE ORDER OF THE AO/TPO HE DISMISSED THE APPEAL OF THE ASSESSEE . 4. BEFORE US,THE AUTHORISED REPRESENTATIVE(AR)STATED T HAT THE ASSESSEE HAD FILED ADDITIONAL EVIDENCE,THAT THE AO HAD DECIDED THE ISSUE WITHOUT CONSIDERING THE SAME, THAT IN THE EARLIER YEARS IDENTICAL ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE,THAT IT HAD RESTORED BACK THE ISSUE TO THE FILE OF TPO/DEPARTMENTAL AUTHORITY.THE DEPAR TMENTAL REPRESENTATIVE (DR) SUPPORTED THE ORDER OF FAA AND STATED THAT THE TRIBUNAL HAD D ECIDED THE ISSUE AGAINST THE ASSESSEE . 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL BEFORE US.WE FIND THAT THE ISSUE OF DETERMINING ALP OF EXPORT OF VACCINE HAS BEEN DISCUSSED BY THE TRIBUNAL FROM AY. 2637/M/15 AND 3956/M/15- M/S. CHIRON BEHRING VACCINES PVT.LTD. 3 2002-03 ONWARDS.WE WOULD LIKE TO REPRODUCE THE RELE VANT PORTION OF THE TRIBUNAL WHICH READS AS FOLLOWS:- 5.1.(ITA/3557/MUM/2006, DTD.25/2/2011-PARA 4.11- A. Y 2002-03) 4.11 IN VIEW OF THE ABOVE DISCUSSIONS, AS WELL AS, THE DECISIONS OF THIS TRIBUNAL AS RELIED UPON BY TH E LEARNED DR, WE HOLD THAT THE TRANSFER PRICING ADJUS TMENT SUGGESTED BY THE TPO ARE NOT AS PER THE PROVISIONS OF LAW. AT THE SAME TIME, THE ASSESSEE H AS ALSO NOT ADOPTED THE CORRECT METHOD OF DETERMINATION OF TNMM. THEREFORE, THE ISSUE IS SET ASIDE TO THE FILE OF THE AO FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW. 5.2.(ITA/2852/MUM/2007 & ITA NO.2667/MUM/2007AY.200 3-2004; ITA/5303/MUM/ 2009,AY.2004-2005; ITA/1999/MUM/2010,AY.2005-2006 D ATED 23 APRIL 2013) AY. 2003-2004 -PARA 2. FIRST ISSUE IN ASSESSEES APPEAL AS WELL AS REVENU ES APPEAL IS AGAINST CONFIRMATION OR DELETION OF ADDITION ON ACCOUNT OF TRANSFER PRICING ADJUSTMENT IN RELATION TO ROYALTY PAID TO CHIRON BEHRING GMBH & CO. AND EXPORTS OF VACCINES TO CHIRON BEHRING GMB H & CO. AT THE VERY OUTSET, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT SIMILAR TRANSFER PR ICING ADJUSTMENTS WERE MADE IN THE PRECEDING YEAR AGAINST WHICH CROSS APPEALS WERE FILED AND THE TRIB UNAL VIDE ITS ORDER DATED 25.02.2011 IN ITA NO.3557 & 3647/MUM/2006 HAS RESTORED THE MATTER OF DETERMINATION OF ARMS LENGTH PRICE IN RESPECT OF THESE TRANSACTIONS TO THE AO / TPO. IT WAS, THER EFORE, PRAYED THAT THE ISSUE RAISED IN THE CURRENT YEAR RELATING TO THE SIMILAR TRANSFER PRICING ADJUSTMENT S BE ALSO SENT BACK. THE LEARNED DEPARTMENTAL REPRESENTATIVE WAS FAIR ENOUGH TO CONCEDE THE FACTU AL POSITION STATED ON BEHALF OF THE ASSESSEE. IN VI EW OF THE RIVAL BUT COMMON SUBMISSIONS, WE SET ASIDE T HE IMPUGNED ORDER AND REMIT THE MATTER OF COMPUTATION OF ALP IN RESPECT OF THESE INTERNATIONA L TRANSACTIONS TO THE FILE OF AO / TPO FOR FRESH DETERMINATION IN ACCORDANCE WITH THE DIRECTIONS GIV EN BY THE TRIBUNAL IN ITS ORDER FOR ASSESSMENT YEAR 2002-2003 . AY.2004-2005: 8. SECOND GROUND OF THE APPEAL IS AGAINST THE DELET ION OF ADDITION MADE BY THE TPO U/S 92CA BY COMPUTING ALP OF ROYALTY AND EXPORT OF VACCINES. HE RE AGAIN BOTH THE SIDES ARE IN AGREEMENT THAT THIS MATTER WOULD ALSO GO BACK TO THE AO / TPO FOR A FRE SH DECISION IN CONFORMITY WITH THE DIRECTIONS GIVEN BY THE TRIBUNAL IN ITS ORDER FOR ASSESSMENT YEAR 20 02-2003. WE ORDER ACCORDINGLY. AY.2005-2006: 10. BOTH THE GROUNDS IN THE REVENUES APPEAL FOR T HIS YEAR ARE AGAINST THE TRANSFER PRICING ADJUSTMEN T IN RESPECT OF ROYALTY PAID TO ITS AE AND EXPORT OF VACCINES. IN VIEW OF THE UNANIMOUS SUBMISSION ADVANCED BY BOTH THE SIDES ACCEPTING THE FACTS AND CIRCUMSTANCES OF THIS YEAR AS ALSO SIMILAR TO THOSE OF THE PRECEDING YEARS, WE SET ASIDE THE IMPUGNED O RDER AND REMIT THE MATTER TO THE FILE OF AO / TPO FOR A FRESH DECISION AS DISCUSSED ABOVE. 5.3. ITA/8247/MUM2010 DT.28/8/2013-AY.2006-07: WE HAVE CONSIDERED THE SUBMISSIONS CAREFULLY, PERUS ED THE ORDERS OF THE LOWER AUTHORITIES AND THE ORDER OF THE TRIBUNAL, REFERRED BY THE COUNSEL, WHI CH IS EXHIBITED AT PAGE-1 OF THE PAPER BOOK. WE FIN D THAT IDENTICAL ISSUE HAS BEEN CONSIDERED BY THE TRI BUNAL AT PARA-4.10 OF ITS ORDER AND THE FINDINGS AR E GIVEN AT PARA 4.11, WHEREIN THE TRIBUNAL HAS HELD T HAT THE TRANSFER PRICING ADJUSTMENT SUGGESTED BY TH E TRIBUNAL TPO ARE NOT AS PER THE PROVISIONS OF LAW. AT THE SAME TIME THE ASSESSEE HAS ALSO NOT ADOPTED THE CORRECT METHOD OF DETERMINATION OF TNMM, THEREF ORE, THE ISSUE IS SET ASIDE TO THE FILE OF THE AO F OR FRESH ADJUSIDACTION IN ACCORDANCE WITH LAW. WE, AC CORDINGLY, RESTORE THIS ISSUE BACK TO THE FILES OF THE ASSESSING OFFICER TO BE DECIDED AFRESH IN LINE WITH THE FINDINGS FOR ASSESSMENT YEAR 2002-03 AFTER GIVING A REASONABLE OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE . 5.4.ITA/4956/MUM/2012 & ITA/4894/M/2012-AY.2007-08( PARA-5): FOLLOWING THE AFORESAID PRECEDENT, AS THE FACTS AN D CIRCUMSTANCES OF THE CASE IN THE INSTANT ASSESSMENT YEAR ARE SIMILAR TO THOSE IN THE ASSESSM ENT YEAR 2002-03, WE SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE MATTER BACK TO THE FILE OF T HE ASSESSING OFFICER TO ADJUDICATE AFRESH IN THE LI GHT OF THE DIRECTIONS OF THE TRIBUNAL DATED 25.02.2011 (SUPRA). THUS, INSOFAR AS THE GROUND OF APPEAL NO. 2 OF THE ASSESSEE IS CONCERNED, THE SAME IS ALLOWED F OR STATISTICAL PURPOSES. CONSIDERING THE ABOVE,WE ARE OF THE OPINION THAT IS SUE OF DETERMINING THE ALP OF EXPORT OF VACCINES SHOULD BE RESTORED BACK TO THE FILE OF TP O/AO. HE IS DIRECTED TO CONSIDER ADDITIONAL EVIDENCES FILED BY THE ASSESSEE BEFORE THE FAA,VIDE ITS LETTER DATED 18.06.2013.IN SHORT,HE 2637/M/15 AND 3956/M/15- M/S. CHIRON BEHRING VACCINES PVT.LTD. 4 WOULD DECIDE THE ISSUE AFTER AFFORDING A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE . EFFECTIVE GROUND OF APPEAL RAISED BY THE ASSESSEE IS DECIDED IN ITS FAVOUR IN PART. ITA/3956/MUM/2015: 6. EFFECTIVE GROUND OF APPEAL,RAISED BY AO,IS ABOUT DE LETING THE ADDITION OF RS.3.30 CRORES MADE UNDER THE HEAD PAYMENT OF ROYALTY.THE TPO,WHIL E PASSING ORDER U/S.92CA (3) OF THE ACT FOUND THAT THE ASSESSEE HAD PAID ROYALTY OF RS. 3.30 CRORES TO ITS AE FOR AN EXCLUSIVE LICENCE TO MANUFACTURE RABIPUR VACCINE IN INDIA,FO R USE OF TECHNICAL INFORMATION FOR MANUFAC -TURING THE VACCINES AS WELL AS TO HAVE AN EXCLUSIV E LICENSE TO SELL VACCINE IN INDIA. HE FURTHER FOUND THAT THE ASSESSEE HAD USED TNMM FOR COMPARIN G THE PROFITABILITY.HE REFERRED TO ARTICLE -8 OF THE JT.VENTURE AGREEMENT AND DETERMIN ED THE ALP OF ROYALTY PAYABLE BY THE ASSESSEE AT RS. NIL. 7. DURING THE APPELLATE PROCEEDINGS BEFORE THE FAA,THE ASSESSEE MADE DETAILED SUBMISSION AND REFERRED TO THE ORDER OF THE TRIBUNAL.CONSIDER ING THE ORDER OF THE TRIBUNAL,HE ALLOWED PAYMENT OF ROYALTY. 8. BEFORE US,DR ARGUED THAT THE TRIBUNAL HAD NOT DECI DED THE ISSUE IN ANY OF THE EARLIER YEARS, THAT MATTER WAS SET ASIDE TO THE FILE OF THE AO.THE AR SUPPORTED THE ORDER OF THE FAA.HERE,WE WOULD LIKE TO REPRODUCE THE ORDERS OF T HE TRIBUNAL FOR EARLIER AY.S 8.1.(ITA/3557/MUM/2006, DTD.25/2/2011-PARA 4.11- A. Y 2002-03)PARA 6.9: 6.9. WE HAVE HEARD THE LEARNED DR AS WELL AS THE LEARNE D AR AND PERUSED THE RELEVANT RECORD. SO FAR AS THE QUESTION OF NECESSITY OF PAYMENT OF THE ROYA LTY IS CONCERNED, THE TPO WAS OF THE VIEW THAT THE PRICE OF SEED VIRUS INCLUDES COMPENSATION TOWARDS U SE OF TECHNOLOGY. WHEN THE ASSESSEE PAID THE CONSIDERATION FOR ACQUISITION OF THE MANUFACTURING FACILITIES, THEN THE SEPARATE PAYMENT FOR ROYALTY I S UNWARRANTED. AFTER CONSIDERING THE RELEVANT RECORD, FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS RIV AL CONTENTIONS, WE NOTE THAT THE VACCINE BUSINESS OF H OECHST AG WAS PURCHASED BY CHIRON CORPORATION, USA AND THE ASSESSEE IS A JOINT VENTURE BETWEEN THE CHIRON CORPORATION, USA AND AVENTIS PHARMA LIMITED, AND WAS FORMED AS A RESULT OF PURCHASE OF THE SAID VACCINE BUSINESS OF HOECHST AG BY THE CHIRON CORPORATION, USA. IN THE YEAR, 1996, THE JOI NT VENTURE COMPANY WAS FORMED BETWEEN CHIRON CORPORATION, U.S.A. AND CHIRON BEHRING GMBH AND CO, KG FOR ACQUIRING THE VACCINE BUSINESS OF BEHRING GMBH KG. AS A RESULT OF THIS CHIRON BEHRING GMBH AND CO BECAME THE OWNER OF ALL TRADE MARK, PATENT AND TECHNICAL KNOW FOR MANUFACTURING O F THE VACCINE AVENTIS INDIA HAD TO PAY ROYALTY AT 5% OF THE LOCAL SALE FOR THE USE OF IMPORTED TECHNI CAL KNOW HOW. FOR THIS PURPOSE THE RBI GRANTED APPROVAL VIDE LETTER DATED 19.4.1997 FOR PAYMENT OF ROYALTY BY AVENTIS PHARMA LIMITED TO CHIRON BEHRING GMBH AND CO AT THE RATE OF 5% OF THE LOCAL SALE. IN THE YEAR 1998, THE ASSESSEE JOINT VENTURE WAS FORMED BY THE AVENTIS PHARMA LIMITED AND CHIRON CORPORATION, USA. THE ASSESSEE JOINT VENTURE PURCHASED THE VACCINE BUSINESS OF THE AVENTIS PHARM A LIMITED. ACCORDING TO THE EXISTING CONTRACT/AGREEMENT BETWEEN THE AVENTIS PHARMA LIMIT ED AND CHIRON BEHRING GMBH ITS CELL CULTURE RABIES VACCINE BUSINESS STOOD TRANSFER IN THE NAME OF THE ASSESSEE JOINT VENTURE. CONSEQUENTLY, THE PAYMENT OF ROYALTY BY THE ASSESSEE TO CHIRON BEHRIN G GMBH CONTINUED AFTER TAKING THE NECESSARY APPROVAL FROM THE RBI. THUS, IT IS CLEAR THAT THE P URCHASING OF THE BUSINESS OF THE AVENTIS PHARMA LIMITED BY THE JOINT VENTURE AS PER THE TERMS AND C ONDITIONS BETWEEN THE PARTIES DOES NOT ACQUIRE THE TECHNOLOGY FOR MANUFACTURING OF THE VACCINE WHICH W AS IN THE POSSESSION OF CHIRON BEHRING GMBH. THEREFORE, AS PER THE AGREEMENT THE PAYMENT OF ROYA LTY IS REQUIRED FOR THE USE OF TECHNICAL KNOW-HOW BY THE ASSESSEE. ACCORDINGLY, WE DO NOT FIND ANY RE ASON TO INTERFERE IN THE ORDER OF THE LEARNED CIT(A ) TO THE EXTENT THAT THE ROYALTY FOR USE OF TECHNICAL KNOW-HOW IS REQUIRED TO BE PAID BY THE ASSESSEE. 2637/M/15 AND 3956/M/15- M/S. CHIRON BEHRING VACCINES PVT.LTD. 5 HOWEVER, ON THE ISSUE OF ALP, SINCE WE HAVE ALREADY REMITTED THE ISSUE OF ALP OF EXPORT TO THE AO, ACCORDINGLY, THE ALP OF ROYALTY IS ALSO REQUIRED TO BE DETERMINED AFTER DUE CONSIDERATION AND AS PER THE PROVISIONS OF LAW. HENCE, THE ISSUE OF ALP IN R ESPECT OF ROYALTY IS SET ASIDE TO THE FILE OF THE A O IN TERMS OF THE ABOVE ORDER IN RESPECT ETC TO THE AE. 8.2. SAME AS PARAGRAPH 5.2. OF OUR ORDER. 8.3.ITA/8247/MUM2010 DT.28/8/2013-AY.2006-07( PARA-12) WE HAVE CAREFULLY CONSIDERED THE ORDERS OF THE LOWE R AUTHORITIES. WE FIND THAT THE DIRECTIONS OF THE DRP DO NOT MENTION ANYTHING ABOUT PAST HISTORY OF T HE ASSESSEE . THE ORDER OF THE DRP IS NOT A SPEAKING ORDER. THEREFORE, IN THE INTEREST OF JUSTI CE AND FAIR PLAY, WE RESTORE THIS ISSUE BACK TO THE FILES OF THE DRP, DRP IS DIRECTED TO CONSIDER THE PAST H ISTORY OF THE ASSESSEE AND DECIDE THE ISSUE AFRESH BY A SPEAKING ORDER AFTER GIVIG A REASOBALE OPPORTUNIT Y OF HEING HEARD TO THE ASSESSEE . 8.4.ITA/4956/MUM/2012 & ITA/4894/M/2012-AY.2007-08: 7. IN VIEW OF THE AFORESAID PRECEDENT, IT IS EVIDE NT THAT THE CIT(A) ERRED IN STRAIGHTAWAY DELETING T HE ADDITION WITHOUT REQUIRING THE ASSESSING OFFICER TO ADJUDICATE THE MATTER AFRESH IN THE LIGHT OF THE DIRECTIONS OF THE TRIBUNAL DATED 25.02.2011 (SUPRA) . THEREFORE, HAVING REGARD TO THE PRECEDENT BY WAY OF THE ORDER OF THE TRIBUNAL DATED 25.02.2011 (SUPR A), ON THIS ASPECT ALSO THE MATTER IS LIABLE TO BE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER. , WHO SHALL ADJUDICATE THE MATTER AFRESH IN THE LIG HT OF THE DIRECTIONS OF THE TRIBUNAL DATED 25.02.2011 (SU PRA) AND AS PER LAW. THUS ON THIS ASPECT THE STAND OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. TH US, THE APPEAL OF THE REVENUE IS TREATED AS PARTLY ALLOWED. RESPECTFULLY FOLLOWING THE ORDER OF TRIBUNAL FOR A. Y. 2007-08,WE RESTORE THE ISSUE TO FILE OF THE AO/TPO.EFFECTIVE GROUND OF APPEAL, RAISED BY AO ,IS DECIDED IN HIS FAVOUR,IN PART. AS A RESULT,APPEALS FILED BY AO AND THE ASSESSEE ST AND PARTLY ALLOWED, ORDER PRONOUNCED IN THE OPEN COURT ON 03 RD NOVEMBER, 2017. 03 , 2017 SD/- SD/- ( / RAM LAL NEGI ) ( / RAJENDRA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; /DATED :03.11.2017. JV.SR.PS. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR A BENCH, ITAT, MUMBAI / , , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , /ITAT, MUMBAI.