M/s. Linde India Limited (formerly BOC India Limited), Kolkata V. DCIT, Circle 12(1), Kolkata, Kolkata

ITA 381/KOL/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 0472 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 23-02-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: G HANGSHING
• Keywords: Capital asset; Transfer pricing; International transaction
• Section: 143(3)

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH C KOLKATA BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI, M. BALAGANESH, ACCOUNTANT MEMBER ITA NO. 543 / KOL / 20 15 ASSESSMENT YEAR :2010-11 M/S. LINDE INDIA LTD. (FORMERLY BOC INDIA LTD.) OXYGEN HOUSE, P-43, TARATALA ROAD, KOLKATA 700 088 [ PAN NO. AAACB 2528 H ] V/S . DCIT, CIRCLE 12(1), AAYAKAR BHAWAN, P- 7, CHOWRINGHEE SQUARE, KOLKATA- 700 069. /APPELLANT .. / RESPONDENT ITA NO. 105 / KOL / 20 16 ASSESSMENT YEAR :2011-12 DCIT, CIRCLE 12(1), AAYAKAR BHAWAN, P-7, CHOWRINGHEE SQUARE, KOLKATA- 700 069. V/S . M/S. LINDE INDIA LTD. (FORMERLY BOC INDIA LTD.) OXYGEN HOUSE, P-43, TARATALA ROAD, KOLKATA 700 088 [ PAN NO. AAACB 2528 H ] /APPELLANT .. / RESPONDENT ITA NO. 224 / KOL / 2016 ASSESSMENT YEAR :2011-12 M/S. LINDE INDIA LTD. (FORMERLY BOC INDIA LTD.) OXYGEN HOUSE, P-43, TARATALA ROAD, KOLKATA 700 088 [ PAN NO. AAACB 2528 H ] V/S . JCIT, RANGE - 12 AAYAKAR BHAWAN, P- 7, CHOWRINGHEE SQUARE, KOLKATA- 700 069. /APPELLANT .. / RESPONDENT ITA NO.543/KOL/2015, 105 & 224/K/2016 & 381/K/2017 M/S. LINDE INDIA LTD. . PAGE 2 ITA NO. 381 / KOL / 2017 ASSESSMENT YEAR :2010-11 M/S. LINDE INDIA LTD. (FORMERLY BOC INDIA LTD.) OXYGEN HOUSE, P-43, TARATALA ROAD, KOLKATA 700 088 [ PAN NO. AAACB 2528 H ] V/S . DCIT, CIRCLE 12(1), AAYAKAR BHAWAN, P- 7, CHOWRINGHEE SQUARE, KOLKATA- 700 069. /APPELLANT .. / RESPONDENT /BY ASSESSEE SHRI RAHUL GUPTA, AR /BY REVENUE SHRI G. HANGSHING, CIT-DR /DATE OF HEARING 06-09-2018 /DATE OF PRONOUNCEMENT 19 -09-2018 / O R D E R PER BENCH: THE INSTANT BATCH COMPRISES OF FOUR CASES. FIRST ASSESSMENT YEAR 2010- 11INVOLVES ASSESSEES APPEAL ITA NO. 543/K/2015 ARISING AGAINST THE DCIT CIRCLE 12, KOLKATA IN ASSESSMENT ORDER DATED 24.02.2015. NEXT ASSESSMENT YEAR 2011-12 COMPRISES OF REVENUES AND ASSESSEES CROSS APPEALS ITA NO. 105/K/2016 AND 224/K/2016 DIRECTED AGAINST ASSESSMENT ORDER DATED 27.11.2015 PASSED BY JCIT RANGE 12, KOLKATA. LAST ASSESSMENT YEAR 2012-13 INVOLVES ASSESSEES APPEAL BEING ITA NO. 381/K/2017 DIRECTED AGAINST THE DCIT, CIRCLE 12(1), KOLKATA ASSESSMENT ORDER DATED 19.12.2016. RELEVANT PROCEEDINGS IN ALL CASES ARE U/S 143(3) READ WITH SECTION 144C(13) OF THE ACT. HEARD BOTH THE PARTIES. CASE FILES PERUSED. 2. LEARNED COUNSEL REPRESENTING STATES AT THE OUTSET THAT ALL ASSESSEES APPEALS CHALLENGE CORRECTNESS OF VARIOUS ADDITIONS INCLUDING TRANSFER PRICING ADJUSTMENTS IN THE THREE ASSESSMENT YEARS. HE INFORM US THAT THE INSTANT TAX PAYER HAD FILED ITS APPLICATION FOR ADVANCE PRICING AGREEMENT APA DATED 30.03.2015 FOR A PERIOD OF 5 YEARS COMMENCING FROM 15 TH APRIL, 2015 ENDING ON 31.03.2020 FOR THE F.Y. 2015-16 ITA NO.543/KOL/2015, 105 & 224/K/2016 & 381/K/2017 M/S. LINDE INDIA LTD. . PAGE 3 TO F.Y. 2019-20. IT HAD ALSO APPLICATION FORM ROLL BACK OF APA OF THE SAME INTERNATIONAL TRANSACTIONS FOR A PERIOD OF 4 YEARS FROM 01.04.2011 TO 31.03.2015 FOR F.Y. 2011-12 TO F.Y. 2014-15. HE PLACES ON RECORD THE RELEVANT UNILATERAL APA CERTIFIED / ISSUED DATED 26.12.2018 ON RECORD. HIS CASE THEREFORE IS THAT THE ABOVE APA COVERS THE SOLE ISSUE IN A.Y. 2010-11 PERTAINING TO TP ADJUSTMENT OF RS. 1,70,78,213/- REGARDING PAYMENT OF INTRA-GROUP SERVICES (IS SUPPORT SERVICES) ALONG WITH CORRESPONDING ADJUSTMENTS OF RS. 2,69,61,898/- IN A.Y. 2011-12 AND THAT OF RS. 7,66,62,259/- IN LAST ASSESSMENT YEAR COUPLED WITH LATTER ISSUE(S) OF TP ADJUSTMENT RELATING TO PAYMENT OF TECHNICAL ASSISTANCE FEES (TAF) OF RS. 2,15,78,466/- AND THIRD SUBSTANTIVE GROUND RAISING THE SAME GRIEVANCE OF CONTAINING ADJUSTMENT ARREAR OF RS. 3,77,95,932/-. HE THEN INVITES OUT ATTENTION TO REVENUES APPEAL BEING ITA NO. 105/K/2016 SEEKING TO INCLUDE TWO COMPARABLES M/S. SRF AND NATIONAL PEROXIDES PERTAINING TO ISSUE OF TECHNICAL ASSISTANCE FEES (TAF) HEREINABOVE. LAST ASSESSMENT YEARS SECONDARY SUBSTANTIVE GROUND OF TRANSFER PRICING ADJUSTMENT OF RS. 1,27,38,549/- RELEVANT TO ACCOUNTING CENTRE FOR EXCELLENT SERVICES IS ALSO STATED TO BE COVERED IN THE ABOVE APA. 3. WE AFFORDED SUFFICIENT OPPORTUNITY TO LEARNED DEPARTMENTAL REPRESENTATIVE. HE STRONGLY SUPPORTS ALL THE IMPUGNED ADJUSTMENTS. COMING TO UNILATERAL ADVANCE PRESENT AGREEMENT DATE 26 TH APRIL, 2018, IT IS PLEADED THAT THE SAME REQUIRES FACTUAL VERIFICATION AT THE TRANSFER PRICING OFFICERS END. WE THEREFORE RESTORE ALL THE ABOVE STATED ISSUES BACK TO THE TRANSFER PRICING OFFICER FOR HIS FACTUAL VERIFICATION AFTER AFFORDING ADEQUATE OPPORTUNITY OF HEARING TO THE TAX-PAYER. THE ASSESSEES FIRST APPEAL BEING ITA NO. 543/K/2015 RAISING THE ABOVE SOLE ISSUE IS ACCEPTED FOR STATISTICAL PURPOSES THEREFORE. 4. WE NOW COME TO THE REMAINING ISSUES IN ASSESSEES APPEALS RELATING TO PURCHASE OF RAW MATERIAL OF RS.4,98,44,615/- SALE OF FINISHED GOODS OF RS. 15,10,218/-, PAYMENT OF CYLINDER RENTAL CHARGES OF RS. 9,62,891/- AND EXPORT OF CAPITAL ASSETS OF RS. 1,15,70,189/-, TOTALING TO RS. 6,38,87,913/- IN A.Y. 2011-12 IN APPEAL ITA 224/K/2016. NO ARGUMENT WAS RAISED BEFORE US DURING THE COURSE OF HEARING IN ORDER TO CHALLENGE CORRECTNESS OF THE LOWER AUTHORITIES ACTION ON ALL THESE ITA NO.543/KOL/2015, 105 & 224/K/2016 & 381/K/2017 M/S. LINDE INDIA LTD. . PAGE 4 COUNTS. ASSESSMENT YEAR 2012-13 ALSO INVOLVES OTHER ISSUES OF PAYMENT OF CYLINDER RENTAL CHARGES AND EXPORT CAPITAL ASSETS INVOLVING SUMS OF RS. 56,00,556/- AND RS. 6,86,42,156/- AGGREGATING TO RS. 7,42,42,712/-. NO ARGUMENT HAS COME FROM ASSESSEE SIDE IN THE IMPUGNED ASSESSMENT YEAR AS WELL. ALL THESE REMAINING ADJUSTMENTS AND ADDITIONS ARE CONFIRMED THEREFORE. WE MAKE IT CLEAR THAT OUR PROCEEDINGS ARE RECORDED AS PER HONBLE APEX COURTS ORDER DATED 14.08.2017 IN WRIT PETITION NO. 99/2015 IN PRADYUMAN BISHT VS UNION OF INDIA AND ORS. THE ASSESSEE MAY APPLY FOR NECESSARY RECTIFICATION IN CASE OUR INSTANT FINDINGS ARE NOT CORRECT AT THE EARLIEST. WE PARTLY ACCEPT ASSESSEES LATTER TWO APPEALS ITA NO. 224/K/2016 AND 381/K/2017 FOR STATISTICAL PURPOSES. 5. THIS LEAVES US WITH REVENUES SECOND GROUND IN ITS APPEAL ITA NO. 105/K/2016 IN AY. 2011-12. IT SEEKS TO REVIVE THE ASSESSING OFFICERS ACTION MAKING 36(1)(VA) R.W. 2(24)X_ DISALLOWANCE / ADDITION OF EMPLOYEES CONTRIBUTION TOWARDS ESI/PF ON ACCOUNT OF ITS BELATED PAYMENT BEYOND THE GRACE PERIOD BUT BEFORE THE DUE DATE OF FILING RETURN. SUFFICE TO SAY, HON'BLE JURISDICTIONAL HIGH COURTS DECISION IN M/S AKZO NOBEL INDIA LTD. VS. CIT ITA NO.110 OF 2011 DECIDED ON 14.06.2016 HAS ALREADY HELD SUCH CLAIM OF ESI/PF DUES PAID BEFORE THE DUE DATE OF FILING RETURN IN ASSESSEES FAVOUR AS PER CIT(A)S DETAILED DISCUSSION UNDER CHALLENGE. THE REVENUE FAILS TO INDICATE ANY DISTINCTION ON FACTS OR LAW. WE FIND NO MERIT IN THE INSTANT SUBSTANTIVE GROUND RAISED AT REVENUES BEHEST. THE SAME IS THEREFORE REJECTED. 6. THE REVENUES FORMER SUBSTANTIVE GROUND SEEKING TO INCLUDE TWO COMPARABLES (SUPRA) ADMITTEDLY PERTAINS TO TRANSFER PRICING ADJUSTMENT WITH RESPECT TO TECHNICAL ASSISTANCE FEES WHICH WE HAVE ALREADY RESTORED BACK TO THE TPO (SUPRA). THIS FORMER SUBSTANTIVE GROUND ALSO FOLLOWS THE SUIT THEREFORE. ITS APPEAL 105/K/2016 IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 7. TO SUM UP, ASSESSEES FIRST APPEAL ITA NO. 543/K/2015 IS ACCEPTED FOR STATISTICAL PURPOSES. ITS SECOND AND THIRD APPEALS ITA 224/K/2016 AND ITA ITA NO.543/KOL/2015, 105 & 224/K/2016 & 381/K/2017 M/S. LINDE INDIA LTD. . PAGE 5 381/K/2017 ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES AND REVENUES APPEAL ITA NO. 105/K/2016 IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT 19/09/2018 SD/- SD/- ( ) ( ) (M.BALAGANESH) (S.S.GODARA) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) BISWAJIT, SR.P.S 19 / 09 /201 8 / COPY OF ORDER FORWARDED TO:- 1. /ASSESSEE - M/S. LINDE INDIA LTD. 2. /REVENUE - DCIT CIRCLE 12/JCIT RANGE 12, KOLKATA 3. / CONCERNED CIT KOLKATA 4. - / CIT (A) KOLKATA (SENT THROUGH E-MAIL) 5. , , / DR, ITAT, KOLKATA (SENT E-MAIL) 6. [ / GUARD FILE. BY ORDER/ , SR. PRIVATE SECRETARY, HEAD OF OFFICE/DDO ,