GOCL Corporation Ltd., (formerly Gulf Oil Corporation Ltd), Hyd, Hyderabad V. ACIT, Cirlce-2(2), Hyd, Hyderabad

ITA 401/HYD/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6226 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-09-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 24-03-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: P CHANDRA SEKHAR
• Keywords: Business income; Transfer pricing; Double taxation relief; Permanent establishment; Non-deduction of tax
• Section: 37(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA.NO.401/HYD/2016 ASSESSMENT YEAR 2011-2012 GOCL CORPORATION LIMITED (FORMERLY GULF OIL CORPORATION LTD.,) HYDERABAD. PAN AABCG8433B VS. ASST. COMMISSIONER OF INCOME TAX, CIRCLE-2(2), HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE : MR. Y. RATNAKAR FOR REVENUE : MR. P. CHANDRASEKHAR DATE OF HEARING : 01.09.2016 DATE OF PRONOUNCEMENT : 21.09.2016 ORDER PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL FOR THE A.Y. 2011-2012. IN THIS APPEAL THE ASSESSEE HAS RAISED 8 GROUNDS OF APPE AL. GROUNDS NO.1, 6, 7 AND 8 ARE GENERAL IN NATURE WHICH NEED N O ADJUDICATION. 2. AS REGARDS GROUND NO.2 AGAINST THE DISALLOWANCE OF ROYALTY PAYMENT OF RS.13,18,304 ON EXPORT SALES, BRIE F FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY PAID ROYALTY ON EXP ORT SALES TO ONE OF ITS ASSOCIATED ENTERPRISE (A.E.'). THE GULF OI L INTERNATIONAL MAURITIUS (INC.) (GOIL), AS PER AGREEMEN T DATED 01.08.2003 AND THE SUPPLEMENTAL AGREEMENT DATED 10.1 1.2003. THIS AGREEMENT WAS APPROVED BY THE GOVERNMENT OF INDIA AND 2 ITA.NO.401/HYD/2016 GOCL CORPORATION LIMITED, HYDERABAD. THE RATE OF ROYALTY INCLUSIVE OF TAX AS APPROVED BY TH E GOI IS AS UNDER : ON DOMESTIC SALES 5.88% (INCLUSIVE OF TAXES) ON EXPORT SALES 9.41% (INCLUSIVE OF TAXES) 2.1. DURING THE RELEVANT FINANCIAL YEAR, THE ASSESSEE PAID ROYALTY OF RS.27,16,107 ON EXPORT SALES OF RS.13,35, 82,370 WHICH WORKED-OUT TO 2.03%. ACCORDING TO THE TPO, RELIEF TO B E ALLOWED AS DEDUCTION SHOULD BE RESTRICTED TO 1% OF THE EXPORT S ALES, BASED ON THE ORDER OF THE COORDINATE BENCH OF ITAT, HYDERA BAD IN ASSESSEES OWN CASE FOR THE EARLIER YEARS. FOLLOWING THE SAME, THE ASSESSING OFFICER WORKED-OUT THE ALP ADJUSTMENT OF ROY ALTY AT RS.13,35,804 AS AGAINST THE ROYALTY ACTUALLY PAID OF RS.27,16,107 AND ARRIVED AT THE ADJUSTMENT OF RS.13,80,304 AND DISAL LOWED THE SAME AND BROUGHT IT TO TAX. THE ASSESSEE RAISED OBJECTIO NS BEFORE THE DRP WHO CONFIRMED THE ORDER OF THE ASSESSING OFFIC ER AND THE ASSESSEE IS IN APPEAL BEFORE US. 3. ACCORDING TO THE ASSESSEE, THE ROYALTY IS PAID FO R THE USE OF TRADE MARK GULF IN INDIA AND ALSO FOR PROV IDING TECHNICAL INFORMATION OF COMPOUNDING, TESTING AND PACKAGING AND APPLICATION OF PRODUCTS AND LICENSE TO USE THE TRADE MA RK AND DESIGN/INDICIA ON PRODUCTS AND THEREFORE, IS REASONA BLE AND IS AT ARMS LENGTH PRICE FOR THE FOLLOWING REASONS : A) THE PERCENTAGE OF PAYMENT OF ROYALTY BY THIRD PARTIES TO OTHER HUBS IS MORE THAN WHAT WAS PAID BY THE APPELLANT TO GULF OIL INTERNATIONAL MAURITIUS (INC.). B) THE PERCENTAGE OF PAYMENT OF ROYALTY BY OTHER SUBSIDIARIES TO OTHER HUBS (AES) IS MORE THAN WHAT WAS 3 ITA.NO.401/HYD/2016 GOCL CORPORATION LIMITED, HYDERABAD. PAID BY THE APPELLANT TO GULF OIL INTERNATIONAL MAURIT IUS (INC.). C) THE ACTUAL PERCENTAGE OF COMMISSION PAID IS VERY MUC H LESS IN COMPARISON TO WHAT WAS APPROVED BY THE RBI WHILE ACCORDING APPROVAL TO THE ROYALTY AGREEMENT ENTERED INTO. D) THE MATTER STANDS COVERED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE ITAT, PUNE BENCH IN KINETIC HONDIA MOTORS LTD. VS. J.C.I.T REPORTED IN 77 ITD 393 AND AL SO THE DECISION OF ITAT IN CADBURY INDIA LTD. VS ADDITION AL COMMISSIONER OF INCOME TAX. THUS, ACCORDING TO THE LEARNED COUNSEL FOR THE ASSESS EE THE ENTIRE AMOUNT OF ROYALTY PAID BY THE ASSESSEE SHOULD B E ALLOWED. 4. THE LD. D.R. HOWEVER, SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW AND ALSO SUBMITTED THAT THE VERY SAME I SSUE HAD ARISEN IN ASSESSEES OWN CASE IN THE EARLIER A.Y . 2006-07 AND THIS TRIBUNAL HAS HELD 1% TO BE REASONABLE ROYALTY ON EXPORT SALES. 5. HAVING REGARD TO THE RIVAL SUBMISSIONS AND THE MATERIAL ON RECORD, WE FIND THAT THIS ISSUE HAD ARISE N IN THE EARLIER ASSESSMENT YEARS AND FOR THE A.Y. 2006-07 IN ITA.NO.1450/HYD/2010, THE B BENCH OF THIS TRIBUNAL VIDE ITS ORDER DATED 22.01.2014 HAS HELD AS UNDER : 10. THE NEXT ISSUE FOR CONSIDERATION THROUGH GROUNDS N O.6 TO 11 IS ON THE ISSUE OF DISALLOWANCE OF ROYALTY AM OUNT 4 ITA.NO.401/HYD/2016 GOCL CORPORATION LIMITED, HYDERABAD. OF RS.2,76,58,080/- PAID BY THE ASSESSEE TO GULF OI L INTERNATIONAL (MARITIUS) INC. (IN SHORT GOIMI). 11. IT WAS SUBMITTED THAT ASSESSEE HAS ENTERED INTO AN AGREEMENT WITH GOIMI ON 01.08.2003 FOR PAYMENT OF ROYALTY ON ENTIRE TURNOVER OF LUBRICANTS INCLUDING DOMESTIC AND EXPORT SALES AT 5.5% (NET OF TAXES). W HEN THE ASSESSEE SOUGHT APPROVAL OF THE GOVERNMENT OF INDIA, THE MINISTRY OF PETROLEUM AND GAS GAVE ITS N OC VIDE LETTER DATED 03RD OCTOBER, 2003 SUGGESTING CHANGES RELATING TO RATE OF ROYALTY AND PERIOD OF ROYALTY. ACCORDINGLY, SUPPLEMENTARY AGREEMENT WAS ENTERED ON 10.11.2003 MAKING ROYALTY PAYABLE AT INTERNAL SALES AT 5% AND EXPORT SALES AT 8% (NET OF TAXES) AND THE ROYALTY WAS PAYABLE FOR A PERIOD OF 7 YEARS FROM THE DATE OF COMMENCEMENT OF COMMERCIAL PRODUCTION. SINCE ROYALTY IS NET OF TAXES AND AS TH E TAX PAID WAS 15% AS PER DTAA, THE CALCULATED ROYALTY RA TE WORKED OUT AS FOLLOWS I.E., ON DOMESTIC SALES AT 5. 88% AND ON EXPORT SALES AT 9.41%. ACCORDINGLY, ASSESSEE CLAIMED AN AMOUNT OF RS.2,76,58,080/- FOR THE YEAR ENDING 31ST MARCH, 2006. THE ENTIRE ROYALTY FOR A.Y . 2006-2007 WAS DISALLOWED BY THE TPO, WHICH WAS CONFIRMED BY THE DRP. 12. IT WAS SUBMITTED THAT ON THE BASIS OF THE SAME AGREEMENT FOR THE SAME SERVICES RENDERED, THE ENTIR E ROYALTY PAID AT RS.3,00,01,312/- WAS DISALLOWED IN NEXT A.Y. 2007- 2008 AND THE VERY SAME FACTUAL POSITION WAS PLACED BEFORE THE DRP. THE DRP IN THAT YEAR HAS ALLOWED THE ROYALTY ON THE INTERNAL SALES/DOMESTIC SALES WHEREAS, THE ROYALTY ON EXPORT SALES WERE RESTRICTED TO 1%. 13. LEARNED COUNSEL REFERRED TO THE RELEVANT PORTIO N OF THE DRP ORDER DATED 20.09.2011 FOR A.Y. 2007-2008 WHEREIN IT WAS HELD THAT GIVEN THE ABOVE INTERNAL CUP INFORMATION THERE IS NO NEED FOR THE TPO TO HAVE DISALLOWED THE ROYALTY PAYMENTS AND DETERMINE ALP CUP AS NIL. ACCORDINGLY, THE OBJECTION RELATING TO ROYALTY PAYMENT ON DOMESTIC SALE WAS ALLOWED AND WITH REGARD TO ROYALTY PAYMENT ON EXPORT SALES THE SAME WAS ALLOWED IN PART TO THE EXTENT OF 1% OF EXP ORT SALES. IT WAS FURTHER SUBMITTED THAT IN A.Y. 2008-2 009 5 ITA.NO.401/HYD/2016 GOCL CORPORATION LIMITED, HYDERABAD. ALSO THE DRP HAS FOLLOWED SIMILAR ORDERS AND IN LAT ER YEAR I.E., A.Y. 2009-2010 ALSO THE TPO HIMSELF HAS DETERMINED THE DISALLOWANCE OF ROYALTY ON EXPORT SA LES IN EXCESS OF 1% AND THE REMAINING AMOUNT WAS FULLY ALLOWED. 14. LEARNED COUNSEL PLACED THE FACTS OF THE LATER Y EARS AND HAS SUBMITTED THAT ON DOMESTIC SALES THERE IS NO DISALLOWANCE IN LATER YEARS AND ACCORDINGLY, THE COMMISSION PAID ON DOMESTIC SALES IN THIS YEAR AMOUNTING TO RS.2,14,28,108/- IS ALLOWABLE. COMING TO THE EXPORT SALES CLAIM OF RS.62,29,972/-, IT WAS SUBMITTED THAT ENTIRE ROYALTY SHOULD BE ALLOWED AND NOT MERELY RESTRICTED TO 1% FOR THE FOLLOWING REASO NS (A) THE PERCENTAGE OF PAYMENT OF ROYALTY BY THIRD PARTIES TO OTHER HUBS IS MORE THAN WHAT WAS PAID BY THE ASSESSEE/APPELLANT TO GOIMI. (B) PERCENTAGE OF PAYMENT OF ROYALTY BY OTHER SUBSIDIARIES TO OTHER H UBS IS MORE THAN WHAT WAS PAID BY THE ASSESSEE/APPELLAN T TO GOIMI. (C) PERCENTAGE OF COMMISSION PAID WAS VER Y MUCH LESS IN COMPARISON WHAT WAS APPROVED BY RBI WHILE ACCORDING APPROVAL TO THE ROYALTY AGREEMENT ENTERED INTO (3.45% AS AGAINST 8% APPROVED BY THE RBI). (D) MATTER STANDS COVERED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE ITAT IN KINETIC MOTOR VS. JCIT 77 ITD 393. 15. THE LEARNED D.R. HOWEVER, ACCEPTED THE FACTUAL POSITION IN LATER YEARS AND RELIED ON THE ORDERS OF THE AUTHORITIES. 16. WE HAVE CONSIDERED THE ISSUE AND EXAMINED THE DOCUMENTS PLACED ON RECORD. AS FAR AS THE ISSUE OF ROYALTY ON DOMESTIC SALES IS CONCERNED, AS RIGHTLY POINTED OUT BY THE LEARNED COUNSEL, THE DRP IN LATE R TWO YEARS HAS EXAMINED THE INTERNAL CUP AND ALLOWED THE ROYALTY ON THE DOMESTIC SALES. KEEPING IN VIEW THE FACTUAL POSITION AS EXAMINED BY THE DRP AND ALSO TH E ORDER OF THE TPO FOR A.Y. 2009-2010, WE ARE OF THE OPINION THAT THERE IS NO NEED TO DISALLOW THE ROYAL TY PAYMENT ON DOMESTIC SALES. THEREFORE, THE CLAIM OF RS.2,14,28,108/- IS ALLOWABLE BASED ON THE ABOVE FACTS. 6 ITA.NO.401/HYD/2016 GOCL CORPORATION LIMITED, HYDERABAD. 16.1. COMING TO THE EXPORT SALES, THE LEARNED COUNS EL RELIED ON THE VARIOUS FACTORS FOR ALLOWING THE ENTIRE CLAI M. HOWEVER, CONSIDERING THE FACT THAT SAME ISSUE WAS ALSO EXAMINED BY THE DRP IN A.YS. 2007-2008 AND 2008-2009 WHICH THE ASSESSEE/APPELLANT SEEMS TO HAVE ACCEPTED, WE ARE OF THE OPINION THAT THE ROYAL TY ON EXPORT SALES CAN BE RESTRICTED TO 1% AS WAS DONE IN LATER YEARS AND ACCORDINGLY, THE ROYALTY IS RESTRIC TED TO AN AMOUNT OF RS.18,05,788/- AS PER THE WORKING FURNISHED BY ASSESSEE AT PARA 24 IN PAGE 7 OF THE PAPER BOOK VOLUME-2. THEREFORE, OUT OF THE AMOUNT O F RS.62,29,972/- ASSESSING OFFICER IS DIRECTED TO ALL OW ROYALTY AT RS.18,05,788/- AND BALANCE AMOUNT OF RS.44,24,184/- STANDS DISALLOWED. 17. LEARNED COUNSEL RELIED ON THE DECISION OF THE COORDINATE BENCH IN THE CASE OF KINETIC MOTOR LTD. VS. JCIT 77 ITD 393 TO SUBMIT THAT ONCE THE AGREEMENT WAS APPROVED BY THE GOVERNMENT OF INDIA, NO DISALLOWANCE IS REQUIRED TO BE MADE. WE HAVE PERUSE D THE SAID DECISION AND NOTICED THAT THE ASSESSMENT Y EAR INVOLVED WAS A.Y. 1995-1996 AND ROYALTY CLAIM WAS ALLOWED BY THE A.O. IN THE IMMEDIATE PRECEDING YEAR I.E., A.Y. 1994-1995. ACCORDINGLY, THE ITAT HELD TH AT THOUGH THE PRINCIPLES OF RESJUDICATA DOES NOT APPLY TO THE DECISION OF THE I.T. AUTHORITIES, YET, ON THE S AME FACTS, THE ASSESSEE CANNOT DENY THE BENEFIT GIVEN I N THE PRECEDING YEAR. THE SAME WAS UPHELD BY THE HONBLE HIGH COURT. WE ARE OF THE OPINION THAT THE SAID FAC TS OF THE CASE ARE ENTIRELY DIFFERENT TO THE FACTS IN THI S CASE. THEREFORE, THE PRECEDENT OF THE DECISION CANNOT BE FOLLOWED HERE. MOREOVER, THIS IS NOT A DISALLOWANCE UNDER SECTION 37(1) BUT AN ADJUSTMENT MADE UNDER TRANSFER PRICING PROVISIONS WHERE ARMS LENGTH PRICE IS TO BE DETERMINED, WHETHER THE AGREEMENT IS APPROVED OR NOT. KEEPING THAT IN MIND, WE ARE OF THE OPINION THAT THE DECISION RELIED ON BY THE LEARNED COUNSEL, DOES NOT APPLY TO THE FACTS OF THE CASE. AS DECIDED EARLIER, THE RESTRICTION ON THE ROYALTY AMOUNT IS LIMITED TO RS.44,24,184/-. ACCORDINGLY, GROUNDS NO. 6 TO 11 AR E PARTLY ALLOWED. 5.1. SINCE THE ISSUE IS COVERED BY THE DECISION OF T HE COORDINATE BENCH, TO WHICH ONE OF US I.E., ACCOUNTANT M EMBER IS 7 ITA.NO.401/HYD/2016 GOCL CORPORATION LIMITED, HYDERABAD. THE SIGNATORY, WE DO NOT SEE ANY REASON TO INTERFERE WITH THE ORDER OF THE ASSESSING OFFICER WHICH IS IN CONSONANCE WITH THE SAID DECISION. THUS, GROUND OF APPEAL NO.2 IS REJECTED. 6. AS REGARDS GROUNDS NO.3 AND 4 AGAINST THE ADDITIO N OF RS.45,97,042 MADE ON THE GROUND THAT THE SAID AMOUNT IS PAID TO FOREIGN CONCERNS WITHOUT MAKING TDS, THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE IS THAT THE ASSESSEE H AS PAID RS.44,86,063 TO M/S. C & C MARITIME P. LTD., AND RS. 1,10,979 TO M/S. EAST PORT MARITIME P. LTD., TOWARDS TRADE AND COMMIS SION RESPECTIVELY FOR SERVICES RENDERED OUTSIDE THE COUNTRY AND SINCE THE PAYEES ARE NOT LIABLE TO TAX IN INDIA, THE DISALLOW ANCE OF THE SAID AMOUNT FOR NON-DEDUCTION OF TAX DOES NOT ARISE. IT WAS FURTHER SUBMITTED THAT THESE PAYMENTS ARE MADE FOR PURCHAS E OF RAW MATERIAL AND THEREFORE, IS THE BUSINESS INCOME OF THE A.E. AND HENCE, DO NOT ATTRACT THE PROVISIONS OF TDS SINCE THE PAYEES DO NOT HAVE PERMANENT ESTABLISHMENTS IN INDIA. THE LEAR NED COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO THE ASSE SSEE S SUBMISSIONS BEFORE THE DRP ON THIS ISSUE AND SUBMITTED THAT THE DRP WITHOUT CONSIDERING THE ASSESSEES SUBMISSIONS HAS REJECTED THE ASSESSEES CONTENTIONS ON THE BASIS OF THE EARLIER YEARS ORDER WHICH ARE ON TOTALLY DIFFERENT SET OF FACTS. THUS, HE P RAYED THAT THE ISSUE MAY BE REMANDED TO THE FILE OF THE DRP OR ELS E TO MODIFY THE DIRECTION OF THE DRP. 7. THE LD. D.R. WAS ALSO HEARD. 8. WE FIND THAT ON THIS ISSUE THE ASSESSEE HAS MADE ELABORATE SUBMISSIONS BEFORE THE DRP AS UNDER : 8 ITA.NO.401/HYD/2016 GOCL CORPORATION LIMITED, HYDERABAD. OBJECTION NO.3 : IT IS CONTENDED THAT THE ADDITION OF RS.45,97,042 M ADE ON THE GROUND THAT THE SAID AMOUNT HAS BEEN PAID TO FO REIGN CONCERNS WITHOUT DEDUCTING TAX AT SOURCE IS ERRONEO US. THE SAID AMOUNT WAS PAID BY THE ASSESSEE COMPANY TO M/S C & C MARITIME PTE LIMITED, SINGAPORE OF RS.44,86,063/- AND TO M/S EAST PORT MARITIME PTE LIMITED, SINGAPORE OF RS . 1,10,979/- TOWARDS FREIGHT CHARGES AND COMMISSION RESPECTIVELY FOR SERVICES RENDERED OUTSIDE THE COUN TRY. BOTH ABOVE VENDORS ARE NOT HAVE ANY PERMANENT ESTABLISHM ENT IN INDIA. THEY ARE NOT LIABLE TO TAX IN INDIA. THE ASS ESSING OFFICER WAS CLEARLY IN ERROR IN DISALLOWING THE SAI D AMOUNT BECAUSE OF NOT SUBMITTING THE COPY OF FROM 15CA. TH E PROVISIONS OF TDS ARE NOT ATTRACTED TO THESE PAYMEN TS. SUBMISSION : 1. THE SUM OF RS.44,86,063/- WAS PAID TO C & C MARITIM E PTE LIMITED SINGAPORE, TOWARDS REIMBURSEMENT FREIGH T CHARGES PAID TO SHIPPING COMPANY FOR TRANS-SHIPMENT OF RAW MATERIAL. A FURTHER SUM OF RS. 1,10,979/WAS PAID TOWARDS BROKERAGE & COMMISSION TO M/S EAST POR T MARITIME PTE LIMITED FOR ARRANGING VESSEL IN SINGAP ORE FOR IMPORT OF RAW MATERIAL. BOTH THE PARTIES TO WHO M THE PAYMENTS ARE MADE HAVE NOT RENDERED ANY SERVICES IN INDIA. THEY DO NOT HAVE ANY PERMANENT ESTABLISHMENT IN INDIA. HENCE, THE PROVISIONS OF TDS ARE NOT ATTR ACTED IN RESPECT OF THE ABOVE PAYMENTS. EVEN OTHERWISE, BOTH THE AMOUNTS PAID CONSTITUTE THE COST OF RAW MATERIAL. THE PROVISIONS OF TDS ARE INAPPLICABLE WHERE THE ASSESSEE PURCHASES RAW MATERIAL FROM A NON-RESIDENT FOR ITS PRODUCTION. TH ERE IS NO TDS PAYMENT ON THE COST OF RAW MATERIAL PURCHASE S. AS SUCH, THE SAME CANNOT BE DISALLOWED U/S.40(A)(IA ) OF THE I.T. ACT ON THE PLEA THAT TAX HAS NOT BEEN DEDU CTED AT SOURCE IN RESPECT OF THE SAID AMOUNT. THE PROVIS IONS OF SECTION 40(A)(IA) OF THE I.T. ACT ARE NOT ATTRAC TED TOWARDS COST OF PURCHASES. 8.1. THE DRP HAS DISPOSED OF THE OBJECTIONS OF THE ASSESSEE BY OBSERVING AS UNDER : 9 ITA.NO.401/HYD/2016 GOCL CORPORATION LIMITED, HYDERABAD. HAVING CONSIDERED THE SUBMISSIONS WE HAVE NOTICED THAT SIMILAR ISSUE WAS THERE IN THE PROCEEDINGS BEFORE T HE DRP FOR THE ASST.YEAR 2010-11 AND THE LEARNED DRP HAS FAVOU RABLY INCLINED WITH THE ARGUMENTS OF THE TAX PAYER AND DI RECTED THE ASSESSING OFFICER TO VERIFY ASSESSEE'S CLAIM AS TO WHETHER THE AMOUNT WAS ACTUALLY PAID ON BEHALF OF GULF OIL INTE RNATIONAL LUBRICANTS PVT. LTD. AND ALLOW ASSESSEE'S CLAIM ACC ORDINGLY. FURTHER, IT IS ALSO NOTICED THAT THE HON'BLE ITAT, HYDERABAD, ON APPEAL BY THE TAX PAYER HAS REMITTED BACK THIS M ATTER FOR AY 2010-11 TO THE AO FOR DETAILED VERIFICATION. RES PECTFULLY FOLLOWING THE ABOVE ORDERS, WE DIRECT THE AO TO VER IFY THE ASSESSEE'S CLAIM AS TO WHETHER THE AMOUNT WAS ACTUA LLY PAID ON BEHALF OF GULF OIL INTERNATIONAL LUBRICANTS PVT. LTD. AND ALLOW ASSESSEE'S CLAIM ACCORDINGLY. 8.2. THUS, IT CAN BE SEEN THAT THE DRP HAS NOT APPLIED ITS MIND TO THE CONTENTIONS OF THE ASSESSEE. THEREFORE, IN THE INTEREST OF JUSTICE, WE DEEM IT FIT AND PROPER TO REMIT THE ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO VERIFY TH E ASSESSEES CLAIM. THUS, GROUNDS OF APPEAL NO.3 AND 4 ARE TREATE D AS ALLOWED FOR STATISTICAL PURPOSES. 9. AS REGARDS GROUNDS OF APPEAL NO.5, THE GRIEVANCE OF THE ASSESSEE IS AGAINST THE FIGURE OF RS.16,99,16,235 TAKEN BY THE ASSESSING OFFICER TOWARDS CARRY FORWARD OF SHORT TERM CAPITAL LOSS AS AGAINST THE CORRECT AMOUNT OF LOSS CARRIED FORWARD I.E., RS.38,42,82,950. THE LEARNED COUNSEL FOR THE ASSESSE E SUBMITTED THAT IN THE EARLIER YEARS, THIS ISSUE HAS BEEN SET ASIDE BY ITAT TO THE FILE OF THE ASSESSING OFFICER FOR ARR IVING AT THE CORRECT CAPITAL LOSS AND PRAYED THAT FOR THE RELEVANT ASS ESSMENT YEAR ALSO, THE ISSUE MAY BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER FOR GIVING CONSEQUENTIAL EFFECT TO THE COMPUTA TION MADE IN THE EARLIER ASSESSMENT YEARS. 10. THE LD. D.R. WAS ALSO HEARD. 10 ITA.NO.401/HYD/2016 GOCL CORPORATION LIMITED, HYDERABAD. 11. IN VIEW OF THE ABOVE, WE DEEM IT FIT AND PROPER TO REMAND THIS ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO GIVE CONSEQUENTIAL EFFECT IN COMPUTATION OF THE BROUGHT FORWARD SHORT TERM CAPITAL LOSS, PURSUANT TO THE LOSS ARRIVED AT IN THE EARLIER ASSESSMENT YEARS CONSEQUENT TO REMAND BY THE ITAT. THIS GROUND OF APPEAL NO.5 OF THE ASSE SSEE IS, THEREFORE, TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 12. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 21.09.2 016. SD/- SD/- (B. RAMAKOTAIAH) (SMT. P. MADHAVI DEVI) ACOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED 21 ST SEPTEMBER, 2016 VBP/- COPY TO : 1. GOCL CORPORATION LTD., (FORMERLY GULF OIL CORPORATION LTD.,) KUKATPALLY, P.B.NO.1, SANATHNAGAR IE (PO), HYDERABAD. 2. THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE-2(2) , HYDERABAD. 3. THE DISPUTE RESOLUTION PANEL-1, G-16, GROUND FLOOR , CENTRAL REVENUE BUILDINGS, QUEENS ROAD, BENGALURU 560 001. 4. PR. CIT-2, HYDERABAD. 5. THE DCIT (TRANSFER PRICING)-II, 3 RD FLOOR, D BLOCK, I.T. TOWERS, A.C. GUARDS, HYDERABAD 500 004. 6. D.R. ITAT A BENCH, HYDERABAD. 7. GUARD FILE.