M/s. Comverse Network Systems India Pvt. Ltd., Gurgaon V. ACIT, Gurgaon

ITA 3463/DEL/2013

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 2072 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-06-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: I2
• Next Hearing Date: 11-07-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 31-05-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SAWETA NAKRA
• Keywords: Transfer pricing; International transaction; Non passing of speaking order
• Section: 92C; 143(3); 92F; 234B

Judgement Text

IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH FRIDAY I-2 NEW DELHI BEFORE SHRI N.S. SAINI, ACCOUNTANT MEM BER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBE R IT (TP)A NO. 3463/DEL/2013 AY: 2005-06 COMVERSE NETWORK SYSTEMS INDIA PVT. LTD., VS ACIT, DLF INFINITY TOWER-A, 2 ND FLOOR, GURGAON CIRCL E, DLF CYBER CITY PHASE-II, GURGAON. GURGAON-122002 (PAN: AABCC3225B) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI G.C. SRIVASTAVA, ADV. SHRI PARICHAY SOLANKI, ADV. RESPONDENT BY : MS SAWETA NAKRA, SR. DR DATE OF HEARING : 14.06.2019 DATE OF PRONOUNCEMENT : 19.06.2019 O R D E R PER SUDHANSHU SRIVASTAVA, JM THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST T HE ORDER PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEA LS), ROHTAK {CIT (A)} VIDE ORDER DATED 28.03.2013 FOR ASSESSME NT YEAR 2005- 06. 2.0 BRIEF FACTS OF THE CASE ARE THAT COMVERSE TECH NOLOGY INC. WHICH IS THE ULTIMATE HOLDING COMPANY OF THE G ROUP WAS INCORPORATED IN THE YEAR 1984 AND IS ENGAGED IN DES IGNING, DEVELOPING, MANUFACTURING, MARKETING AND SUPPORTING IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 2 TELECOMMUNICATION SYSTEMS AND SOFTWARE FOR MULTIMED IA, COMMUNICATIONS AND INFORMATION PROCESSING APPLICATI ONS. THE HOLDING COMPANY, THROUGH ITS VARIOUS SUBSIDIARIES, PRIMARILY MAKES COMMUNICATION SYSTEMS AND SOFTWARE THAT TELEC OM COMPANIES USE TO OFFER CALL ANSWERING, VOICE/FAX MA IL, COMMUNICATIONS SURVEILLANCE AND RECORDING ETC. THE ASSESSEE IS A SUBSIDIARY OF COMVERSE TECHNOLOGY INC USA WHICH H OLDS 99.90% OF THE CAPITAL. THE ASSESSEE WAS INCORPORAT ED IN THE YEAR 1999 TO PROVIDE PRE-SALES SUPPORT AND POST SALES SU PPORT SERVICES PRIMARILY TO THE CUSTOMERS OF COMVERSE NETWORK SYST EMS LTD. 2.1 THE RETURN OF INCOME FOR THE CAPTIONED YEAR WA S FILED DECLARING AN INCOME OF RS. 90,00,050/-. SINCE THE ASSESSEES CASE WAS COVERED UNDER THE SCRUTINY CATEGORY, AS PE R THE GUIDELINES OF THE CBDT, SCRUTINY PROCEEDINGS WERE I NITIATED. SINCE THE ASSESSEE HAD UNDERTAKEN INTERNATIONAL TRA NSACTIONS DURING THE YEAR, A REFERENCE WAS MADE TO THE TRANSF ER PRICING OFFICER(TPO) U/S 92CA(3) OF THE INCOME TAX ACT, 196 1 (HEREINAFTER CALLED 'THE ACT') IN RESPECT OF THE FOLLOWING INTER NATIONAL TRANSACTIONS:- I) SALES AND POST SALES SUPPORT - RS. 100,213,2 64/- II) PURCHASE OF FIXED ASSETS - RS. 1,021,316 /- IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 3 III) COST REIMBURSEMENT RECHARGES OF EXPENSES PAID - RS. 2,68,177/- 2.2 THE ASSESSEE HAD CHOSEN TRANSACTIONAL NET MARG IN METHOD (TNMM) AS THE MOST APPROPRIATE METHOD WITH O P/TC AS THE PROFIT LEVEL INDICATOR (PLI) AND HAD ARRIVED AT A SET OF SIX COMPARABLES WHOSE OVERALL PLI WAS 1.75% WHEREAS IT HAD CALCULATED ITS OWN PLI AT 5.96%, THEREBY HOLDING TH AT THE TRANSACTIONS RELATING TO PROVISION OF SALES AND POS T SALES SUPPORT SERVICES WERE AT ARMS LENGTH PRICE (ALP). WITH RE SPECT TO THE PURCHASE OF FIXED ASSETS FROM COMVERSE LTD., ISRAEL , THE ASSESSEE HAD USED COMPARABLE UNCONTROLLED PRICE (CUP) METHOD TO JUSTIFY THE ALP AND HAD CONTENDED THAT THE SAME KIND OF FIX ED ASSETS HAD BEEN SOLD BY THE ASSOCIATED ENTERPRISE (AE) TO THE THIRD PARTY AT THE SAME PRICE AND HENCE THE TRANSACTION WAS AT ARMS LENGTH. THE ASSESSEES COMPARABLES WITH RESPECT TO PROVISIO NS OF SALES AND POST SALES SUPPORT SERVICES WERE AS UNDER:- I) CMC LIMITED II) FL SMIDTH LIMITED III) HARTRON COMMUNICATION IV) HIMACHAL FUTURISTICS COMMUNICATION LIMITED IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 4 V) POWERPLANT PERFORMANCE IMPROVEMENT LIMITED VI) TCE CONSULTING ENGINEERS LIMITED 2.3 HOWEVER, THE TPO ACCEPTED SOME OF THE ASSESSEE S COMPARABLES AND INCLUDED SOME MORE COMPARABLES ON H IS OWN. THE FINAL SET OF COMPARABLES, AS DETERMINED BY THE TPO, WAS AS UNDER:- I) ICRA LIMITED II) TERA SOFTWARE III) TOYO ENGINEERING LIMITED IV) GRINTEX INDIA LIMITED V) VITAL COMMUNICATIONS LIMITED VI) OTIS ELEVATORS LIMITED VII) TCE CONSULTING ENGINEERS LIMITED 2.4 THE TPO, THEREAFTER, PROCEEDED TO COMPARE THE MEAN MARGIN COMPARABLES AT 21.63% AND PROPOSED A TRANSFE R PRICING ADJUSTMENT OF RS. 1,56,10,332/-. THE ASSESSMENT WA S COMPLETED AT AN INCOME OF RS. 2,46,10,382/- AFTER MAKING A TR ANSFER PRICING ADJUSTMENT AS PROPOSED BY THE TPO. 2.5 AGGRIEVED, THE ASSESSEE APPROACHED THE LD. FIR ST APPELLATE AUTHORITY AND THE LD. COMMISSIONER OF INC OME TAX (APPEALS) ALLOWED PARTIAL RELIEF TO THE ASSESSEE BY DIRECTING IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 5 EXCLUSION OF ICRA LIMITED AND OTIS ELEVATORS LIMITE D. STILL AGGRIEVED, THE ASSESSEE IS NOW BEFORE THIS TRIBUNAL (ITAT) AND HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE APPELLANT RESPECTFULLY CRAVES LEAVE TO PREFER A N APPEAL AGAINST THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (THE AC T) BY THE LEARNED ASSESSING OFFICER (AO) (AFTER CONSIDE RING THE ADJUSTMENTS PROPOSED BY THE LEARNED TRANSFER PRICING OFFICER (TPO) IN HIS ORDER PASSED UNDER S ECTION 92CA(3) OF THE ACT) AND IN PURSUANCE OF THE ORDER PASSED BY THE HONBLE COMMISSIONER OF INCOME-TAX (APPEALS) (CIT(A)) UNDER SECTION 250(6) OF THE AC T ON THE FOLLOWING GROUNDS: EACH OF THE GROUND IS REFERRED TO SEPARATELY, WHICH MAY KINDLY BE CONSIDERED INDEPENDENT OF EACH OTHER. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, 1. THE HONBLE CIT(A) HAS ERRED IN UPHOLDING THE ADDIT ION OF INR 15,610,332 MADE BY THE LEARNED AO / TPO TO THE TOTAL INCOME OF THE APPELLANT BY CONFIRMING THE LEARNED AOS REJECTION OF ECONOMIC ANALYSIS UNDERTAKEN BY THE APPELLANT IN ACCORDANCE WITH THE PROVISIONS OF THE ACT READ WITH THE INCOME-TAX RULE S, 1962 (THE RULES), AND MODIFYING THE SAME FOR THE DETERMINATION OF THE ARMS LENGTH PRICE (ALP) OF THE APPELLANTS INTERNATIONAL TRANSACTION TO HOLD THAT THE SAME IS NOT AT ARMS LENGTH. 2. THE HONBLE CIT (A) HAS ERRED IN UPHOLDING THE LEAR NED AOS ACTION OF NOT PROVIDING AN OPPORTUNITY TO THE APPELLANT OF BEING HEARD BEFORE REFERRING THE TRANS FER PRICING ISSUES TO THE LEARNED TPO. 3. THE HONBLE CIT (A) / AO HAS ERRED IN: IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 6 (A) USING DATA FOR A SINGLE YEAR INSTEAD OF MULTIPLE YEAR DATA; AND (B) DETERMINING THE ARMS LENGTH MARGINS / PRICES USING DATA PERTAINING ONLY TO FINANCIAL YEAR (FY) 2004-05 WHICH WAS NOT AVAILABLE TO THE APPELLANT AT THE TIME OF COMPLYING WITH THE INDIAN TP DOCUMENTAT ION REQUIREMENTS. 4. THE HONBLE CIT (A) / AO HAS ERRED, IN WRONGLY REJECTING CERTAIN COMPANIES SELECTED BY THE APPELLA NT AND ADDING CERTAIN COMPANIES TO THE FINAL SET OF COMPARABLES FOR THE TRANSACTION PERTAINING TO PROVI SION OF SALES AND POST SALES SUPPORT SERVICES ON AN AD- HOC BASIS, THEREBY RESORTING TO CHERRY PICKING OF COMPA RABLE FOR BENCHMARKING THE SAID TRANSACTION. 5. THE HONBLE CIT (A) HAS ERRED IN UPHOLDING THE ORDER OF THE LEARNED AO / TPO IN SO FAR AS REJECTION OF H ARTRON COMMUNICATION LIMITED IS CONCERNED WITHOUT ASCRIBIN G ANY REASONS THERETO, THEREBY PASSING A NON SPEAKING ORDER AND VITIATING THE PRINCIPLES OF NATURAL JUSTI CE. 6. THE HONBLE CIT (A) HAS ERRED, IN UPHOLDING T HE ENTIRE ADJUSTMENT MADE BY THE LEARNED AO/ TPO, EV EN AFTER EXCLUDING TWO COMPANIES FROM THE FINAL SET OF COMPARABLE TO BENCHMARK THE SAID TRANSACTION. 7. THE HONBLE CIT (A) HAS ERRED IN INCLUDING COMP ANIES WHICH WERE REJECTED ON ACCOUNT OF FUNCTIONAL DISSIMILARITY IN IMMEDIATELY PRECEDING ASSESSMENT Y EAR FOR BENCHMARKING THE SAID TRANSACTION, THEREBY ADOP TING AN INCONSISTENT APPROACH AND RENDERING THE SAID ANALYSIS DEFECTIVE. 8. THE HONBLE CIT (A) / AO HAS ERRED, IN ASSUMIN G THAT THE APPELLANT SHOULD HAVE EARNED AN OPERATING MARGI N OF 21.63 PERCENT (OP/OC) FROM UNCONTROLLED TRANSACT IONS, THEREBY EXCEEDING HIS JURISDICTION AND ACTING IN CONTRAVENTION OF LAW. IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 7 9. THE HONBLE CIT(A) / AO HAS ERRED IN NOT MAKING APPROPRIATE ADJUSTMENTS TO ACCOUNT FOR DIFFERENCES IN WORKING CAPITAL EMPLOYED BY THE APPELLANT VIS-A-VIS THE COMPARABLES. 10. THE HONBLE CIT(A) / AO HAS ERRED IN NOT MAKIN G SUITABLE ADJUSTMENTS TO ACCOUNT FOR DIFFERENCES IN THE RISK PROFILE OF THE APPELLANT VIS-A-VIS THE COMPARABLES. 11. THE HONBLE CIT(A) / AO HAS ERRED IN NOT PROVI DING THE BENEFIT OF THE ARMS LENGTH RANGE AS PROVIDED U NDER PROVISO TO SECTION 92C OF ACT FOR PURPOSES OF COMPU TING THE ARMS LENGTH PRICE UNDER SECTION 92F OF THE ACT . 12. THE LEARNED AO HAS ERRED IN INITIATING PENALTY PROCEEDINGS UNDER SECTION 271 (1 )(C) OF ACT IN REL ATION TO TRANSFER PRICING ADJUSTMENT. 13. THE HONBLE CIT(A) / AO HAS ERRED IN LEVYING I NTEREST UNDER SECTION 234B OF THE ACT. 3.0 THE LD. AUTHORISED REPRESENTATIVE (AR) SUBMIT TED THAT THE ASSESSEE WANTED INCLUSION OF FIVE COMPARAB LES VIZ.:- I) CMC LIMITED II) FL SMIDTH LIMITED III) HARTON COMMUNICATION LIMITED IV) HIMACHAL FUTURISTICS COMMUNICATION LIMITED V) POWERPLANT PERFORMANCE IMPROVEMENT LIMITED 3.1 IT WAS FURTHER SUBMITTED BY THE LD. AR THAT TH E ASSESSEE WAS PRAYING FOR EXCLUSION OF THREE COMPARA BLES VIZ. TCE CONSULTING ENGINEERS LIMITED, TERA SOFTWARE LIMITED AND VITAL COMMUNICATIONS LIMITED. IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 8 3.2 THE ARGUMENTS OF THE LD. AR VIS-A-VIS THE INCLUSION OF THE COMPARABLES WERE AS UNDER:- I) CMC LIMITED THE LD. AR SUBMITTED THAT THE ASSESSEE HAD SELECTED THIS COMPARABLE IN THE TRANSFER PRICING STUDY BUT THE SA ME HAD BEEN EXCLUDED BY THE TPO AND THE LD. COMMISSIONER O F INCOME TAX (APPEALS) HAD UPHELD THE EXCLUSION WITHO UT GIVING ANY REASONING. HE DREW OUR ATTENTION TO THE IMPUGNED ORDER AND SUBMITTED THAT NO FINDING HAD BE EN GIVEN BY THE LD. COMMISSIONER OF INCOME TAX (APPEAL S) IN THIS REGARD. II) FL SMIDTH LIMITED IT WAS SUBMITTED BY THE LD. AR THAT THE ASSESSEE HA D TAKEN THIS COMPANY ALSO AS A COMPARABLE BUT THE SAME HAD BEEN EXCLUDED BY THE TPO AND THE LD. COMMISSIONER OF INC OME TAX (APPEALS) HAD ALSO UPHELD THE FINDINGS OF THE T PO BY HOLDING THAT THIS COMPANY WAS A COMPANY RELATED TO CEMENT INDUSTRY. IT WAS SUBMITTED THAT THIS EXCLUSION WAS INCORRECT INASMUCH AS THE ASSESSEE HAD ONLY CONSIDERED THE SE RVICE SEGMENT INSTEAD OF THE ENTIRE COMPANY AT THE ENTITY LEVEL IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 9 AND, THEREFORE, THE CONTENTION OF THE TPO THAT IT W AS NOT A SERVICE COMPANY WAS INCORRECT. III) HARTRON COMMUNICATION LIMITED IT WAS SUBMITTED THAT THIS ALSO WAS A COMPARABLE SE LECTED BY THE ASSESSEE BUT HAD BEEN EXCLUDED BY THE TPO WI THOUT ASSIGNING ANY SPECIFIC REASON FOR REJECTION. IT WA S ALSO SUBMITTED THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAD ALSO EXCLUDED THE COMPANY BUT HAD NOT GIVEN ANY SPECIFIC FINDING WHILE REJECTING THIS COMPARABL E. IV) HIMACHAL FUTURISTICS COMMUNICATION LIMITED IT WAS SUBMITTED BY THE LD. AR THAT THIS COMPANY WA S ALSO SELECTED BY THE ASSESSEE BUT HAD BEEN EXCLUDED BY T HE TPO AND THE FINDINGS OF THE TPO HAD BEEN UPHELD BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS) BY HOLDING THA T THIS COMPANY WAS ENGAGED IN THE MANUFACTURING OF TELECOM EQUIPMENT AND HENCE NOT COMPARABLE. IT WAS SUBMITT ED BY THE LD. AR THAT THIS COMPANY HAD BEEN HELD TO BE A COMPARABLE IN ASSESSEES CASE BY THE LD. DISPUTES RESOLUTION PANEL (DRP) IN ASSESSMENT YEAR 2007-08. IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 10 V) POWERPLANT PERFORMANCE IMPROVEMENT LIMITED IT WAS SUBMITTED BY THE LD. AR THAT THIS WAS ALSO A COMPARABLE SELECTED BY THE ASSESSEE BUT HAD BEEN EX CLUDED BY THE TPO ON THE GROUND THAT THE COMPANY WAS ENGAG ED IN MODERNIZATION OF POWER PLANTS. IT WAS FURTHER SUBM ITTED THAT THE FINDING OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) IN UPHOLDING THE ORDER OF THE TPO WAS GIV EN WITHOUT ANY REASONING. 3.3 WITH RESPECT TO THE COMPARABLES WHICH THE ASSE SSEE WANTS TO BE EXCLUDED, THE SUBMISSIONS OF THE LD. AR WERE AS UNDER:- 1) TCE CONSULTING ENGINEERS LIMITED THE LD. AR SUBMITTED THAT ORIGINALLY IT WAS THE ASS ESSEES OWN COMPARABLE AND IT HAD BEEN ACCEPTED BY THE TPO ALSO. HOWEVER, NOW THE ASSESSEE WAS PRAYING FOR ITS EXCLU SION BECAUSE THIS COMPANY WAS FUNCTIONALLY DISSIMILAR AS IT WAS ENGAGED IN RENDERING ENGINEERING RELATED SERVICES I N VARIOUS SECTORS INCLUDING INFRASTRUCTURE, TRANSPORTATION, E NERGY, PROCESSED STEEL AND METAL, MINING AND CHEMICALS AND ENGINEERING CONSULTANCY SERVICES WHICH WERE DISSIMI LAR TO IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 11 THE SERVICES PROVIDED BY THE ASSESSEE COMPANY. IT WAS ALSO SUBMITTED THAT THIS COMPANY HAD BEEN HELD TO BE FUNCTIONALLY DISSIMILAR BY THE ITAT IN ASSESSEES O WN CASE FOR ASSESSMENT YEAR 2010-11. 2) TERA SOFTWARE LIMITED THE LD. AR SUBMITTED THAT THIS COMPARABLE WAS INCLU DED BY THE TPO ON THE GROUND THAT IT WAS FUNCTIONALLY SIMI LAR TO THE ASSESSEE COMPANY BUT THIS COMPANY PROVIDED SOFTWARE SOLUTIONS AND SERVICES AND WAS FOCUSSED ON PROVIDIN G E- GOVERNANCE SOLUTIONS AND FURTHER THIS COMPANY WAS ENGAGED IN EXECUTING VARIOUS COMPUTER LITERACY PROJ ECTS IN SCHOOLS FOR STATE GOVERNMENTS. THE COMPANY WAS ALS O INTO TRADING OF VARIOUS KINDS OF COMPUTER ITEMS WHEREAS THE ASSESSEE WAS A PRE AND POST SALES SERVICE PROVIDER. IT WAS SUBMITTED THAT THIS COMPANY SHOULD BE EXCLUDED FROM THE FINAL SET OF COMPARABLES. 3. VITAL COMMUNICATIONS LIMITED IT WAS SUBMITTED THAT THIS COMPANY WAS INCLUDED BY THE TPO ON THE GROUND THAT THIS WAS FUNCTIONALLY SIMILA R TO THE ASSESSEE COMPANY WHEREAS THIS COMPANY PROVIDED SOFT WARE IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 12 SOLUTIONS AND SERVICES AND ALSO PROVIDED E-COMMERCE SOLUTIONS AND SOFTWARE DEVELOPMENT SERVICE WHICH IS FUNCTIONALLY DISSIMILAR TO PROVISION OF SALES AND P OST SALES SERVICES PROVIDED BY THE ASSESSEE. 4.0 IN RESPONSE, THE LD. SENIOR DEPARTMENTAL REPRESENTATIVE (SR. DR) SUBMITTED THAT IT IS NOT TH E CASE OF THE ASSESSEE THAT THE TPO HAD REJECTED THE SEARCH PROCE SS CARRIED OUT BY THE ASSESSEE AND THE TPO HAD ONLY FINE TUNED THE SEARCH PROCESS. IT WAS ALSO SUBMITTED THAT THE ASSESSEE H AD NOT DISPUTED THE SEARCH CRITERIA ADOPTED BY THE DEPARTM ENT AS WAS VERY MUCH EVIDENT FROM THE COMBINED READING OF THE ORDER OF THE TPO AS WELL AS THE ASSESSING OFFICER. IT WAS FURTH ER SUBMITTED THAT THE ASSESSEE HAD USED MULTIPLE YEAR DATA WHICH WAS NOW NOT PERMISSIBLE AS PER THE SETTLED JUDICIAL PRECEDENT. THE LD. SR. DR VEHEMENTLY ARGUED THAT THE ASSESSEE SHOULD NOT BE A LLOWED TO CHERRY PICK THE COMPARABLES WHICH WOULD SUIT ITS PU RPOSE TO JUSTIFY THE ASSESSEES STAND THAT THE TRANSACTIONS WERE AT ARMS LENGTH PRICE. 5.0 ON A QUERY FROM THE BENCH, BOTH THE PARTIES FA IRLY AGREED THAT TO GIVE A FAIR CHANCE TO THE ASSESSEE A LL THE COMPARABLES COULD BE RESTORED TO THE FILE OF THE LD . COMMISSIONER IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 13 OF INCOME TAX (APPEALS) TO RE-CONSIDER THE ISSUES A S THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAD NOT CONSID ERED THE OBJECTIONS/SUBMISSIONS OF THE ASSESSEE ON A NUMBER OF COMPARABLES AND HAD ALSO PASSED A NON-SPEAKING ORDE R IN RESPECT OF SOME OF THE COMPARABLES. 5.1 BOTH THE PARTIES ALSO AGREED THAT THE ISSUE OF WORKING CAPITAL ADJUSTMENT AS CONTESTED BY THE ASSESSEE IN GROUND NO. 9 AND 10 SHOULD ALSO BE RE-CONSIDERED BY THE LD. COMM ISSIONER OF INCOME TAX (APPEALS). 6.0 WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE A LSO PERUSED THE MATERIAL ON RECORD. BEFORE US, THE ASSE SSEE HAS PRAYED FOR EXCLUSION OF FIVE COMPARABLES AND INCLUS ION OF THREE COMPARABLES. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT THE LD. CIT (A) HAS NOT PROPERLY CONSIDERED THE OBJECTIONS/ SUBMISSIONS OF THE ASSESSEE ON A NUMBER OF COMPARABLES AND HAS ALSO PASSED A NON-SPEAKING ORDER IN RESPECT OF SOME OF THE COMP ARABLES. THE LD. SR. DR HAS BEEN FAIR TO ACCEPT THAT THE ISSUES NEED A RE- EXAMINATION BY THE LD. FIRST APPELLATE AUTHORITY. T HEREFORE, IN VIEW OF THE FACTS, WE DEEM IT APPROPRIATE TO RESTOR E THE ADJUDICATION ON THE EXCLUSION AND INCLUSION OF THE ABOVE MENTIONED EIGHT COMPARABLES TO THE FILE OF THE LD. CIT (A). IT IS IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 14 RESTORED ACCORDINGLY WITH A DIRECTION TO THE LD. CI T (A) TO ADJUDICATE THE ISSUE AFTER PROVIDING REASONABLE OPP ORTUNITY TO THE ASSESSEE IN THIS REGARD. 6.1 IN VIEW OF THE ACCEPTANCE OF BOTH THE PARTIES BEFORE US, THE ISSUE OF WORKING CAPITAL ADJUSTMENT AND RISK AD JUSTMENT IS ALSO RESTORED TO THE FILE OF THE LD. CIT (A). IT IS RESTORED ACCORDINGLY WITH A DIRECTION TO THE LD. CIT (A) TO ADJUDICATE THE ISSUES AFTER PROVIDING REASONABLE OPPORTUNITY TO TH E ASSESSEE IN THIS REGARD. 7.0 IN THE FINAL RESULT, THE APPEAL OF THE ASSESSE E STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 19.06.2 019. SD/- SD/- (N.S. SAINI) (SUDHA NSHU SRIVASTAVA) ACCOUNTANT MEMBER JUDICIAL MEMBE R DATED: 19 TH JUNE, 2019 GS IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 15 COPY FORWARDED TO: - 1) APPELLANT 2) RESPONDENT 3) CIT(A) 4) CIT 5) DR BY ORDER ASSTT. REGISTRAR DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS /PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P S/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER IT(TP)A NO. 3463/DEL/2013 ASSESSMENT YEAR 2005-06 16