DQ Entertainment (International) Limited, Hyderabad, Hyderabad V. ACIT, Circle-14(1), Hyderabad, Hyderabad

ITA 441/HYD/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2616 (ITAT-HYDERABAD)
• Duration Of Justice: 10 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 08-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J SIRI KUMAR
• Keywords: Transfer pricing; Double taxation relief; International transaction
• Section: 143(3); 92B; 10AA

Judgement Text

ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 1 OF 10 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO.441/HYD/2017 (ASSESSMENT YEAR: 2012-13) M/S. DQ ENTERTAINMENT INTERNATIONAL LTD HYDERABAD PAN: AACCD 8731 C VS ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE 14(1) HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI P.V.S.S. PRASAD FOR REVENUE : SHRI J. SIRI KUMAR, DR O R D E R PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL FOR THE A.Y 2012-13. IN T HIS APPEAL, THE ASSESSEE IS AGGRIEVED BY THE ORDER OF T HE AO, DATED 9.1.2017 PASSED U/S 143(3) R.W.S. 144C OF THE I.T. ACT. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1 . THE LD DISPUTE RESOLUTION PANEL (DRP)/LD ASSESSING OFFICER (AO) ARE ERRONEOUS IN LAW AND ON THE FACTS OF THE CASE. 2. THE LD. DRP/AO ARE NOT LEGALLY JUSTIFIED IN MAKING AN ADJUSTMENT OF RS.2,45,32,965/- AS PROFIT ATTRIBUTABLE TO THE APPELLANT COMPANY UNDER THE PROFIT SPLIT METHOD IN CONNECTION WITH THE ABSOLUTE SALE OF INTANGIBLE ASSETS TO AE WHEN SUCH REVENUE IS GENERATED BY AE OF THE APPELLANT DATE OF HEARING: 25.10 . 2017 DATE OF PRONOUNCEMENT: 12.01.2018 ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 2 OF 10 COMPANY I.E., DQ IRELAND WHICH IS THE ABSOLUTE OWNER OF SUCH INTANGIBLE ASSETS. 3. THE LD. DRP/AO IS ERRONEOUS IN NOT CONSIDERING THE FACT THAT THE INTANGIBLE ASSETS WERE SOLD TO IT S AE AT ARM'S LENGTH AND ACCEPTED BY THE LD.AO/TPO AND THEREFORE DID NOT REQUIRE ANY FURTHER ADDITIONAL ADJUSTMENT. 4. THE LD. DRP/AO ARE NOT JUSTIFIED IN QUESTIONING THE COMMERCIAL WISDOM OF THE APPELLANT' DECISION TO INCUR THE EXPENDITURE TOWARDS MANAGEMENT CONSULTANCY FEES OF RS.2,14,06,3071. THE LD DRP/AO OUGHT TO HAVE CONSIDERED THE TANGIBLE AND DIRECT BENEFITS DERIVED BY THE APPELLANT BY INCURRING THE MANAGEMENT CONSULTANCY FEES AND OUGHT TO HAVE ALLOWED THE SAME AS COMPLYING WITH ARMS LENGTH PRINCIPLE. 5. THE LD. DRP/AO IS NOT JUSTIFIED IN LAW IN EXCLUDING RS. 2,43,34,627/- BEING INSURANCE AND TRAVELLING & CONVEYANCE EXPENSES FROM EXPORT TURNOVER FOR THE PURPOSE OF COMPUTATION OF EXEMPTION U/S IOAA WHEN SUCH EXPENSES ARE NOT ATTRIBUTABLE TO DELIVERY OF ARTICLES OR THINGS OUTS IDE INDIA. 6. WITHOUT PREJUDICE TO OUR GROUND NO. 5, THE LD DRP/AO OUGHT TO HAVE REDUCED INSURANCE AND TRAVELLING & CONVEYANCE EXPENSES BOTH FROM EXPORT TURNOVER AS WELL AS FROM TOTAL TURNOVER INSTEAD OF REDUCING THE SAME FROM EXPORT TURNOVER ONLY. 7. THE LD. DRP/AO IS NOT JUSTIFIED IN LAW IN EXCLUDING RS.1,25,20,967/- BEING COMMUNICATION CHARGES FROM EXPORT TURNOVER FOR THE PURPOSE OF COMPUTATION OF EXEMPTION U S 10AA. 8. THE LD. DRP/AO OUGHT TO HAVE REDUCED THE COMMUNICATION CHARGES BOTH FROM EXPORT TURNOVER AS WELL AS FROM TOTAL TURNOVER INSTEAD OF REDUCING THE SAME FROM EXPORT TURNOVER ONLY. ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 3 OF 10 9. THE LD. AO LEGALLY ERRED IN LEVYING INTEREST U/S 2348 OF THE ACT AGAINST LEGALLY UNTENABLE ADJUSTMENTS. 10. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME OF HEARING WITH THE PREVIOUS APPROVAL OF THE HON'BLE TRIBUNAL 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE CO MPANY, ENGAGED IN THE BUSINESS OF PROVIDING ANIMATION PROD UCTION SERVICES FOR TELEVISION AND FILM PRODUCTION COMPANI ES FROM ITS IN- HOUSE ANIMATION STUDIO FACILITIES IN HYDERABAD, FIL ED ITS RETURN OF INCOME FOR THE A.Y 2012-13 ON 29.11.2011 ADMITTING TOTAL INCOME OF RS.72,39,133. DURING THE ASSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT, THE AO OBSERVED THAT THE ASSESSEE HAS E NTERED INTO INTERNATIONAL TRANSACTION WITH ITS AE. THEREFORE, T HE CASE WAS REFERRED TO THE TPO FOR DETERMINATION OF THE ARMS LENGTH PRICE. 3. THE TPO PASSED AN ORDER U/S 92CA(3) OF THE ACT O N 30.01.2015 AND IN ACCORDANCE WITH THE SAME, THE DRA FT ASSESSMENT ORDER WAS PASSED BY THE AO. THE ASSESSEE PREFERRED ITS OBJECTION BEFORE THE DRP AND CONSEQUENT TO THE DRP ORDER, THE FINAL ASSESSMENT ORDER DATED 9.1.2017 WAS PASSED AN D THE ASSESSEE IS IN FURTHER APPEAL BEFORE US AGAINST THE T.P. ADJUSTMENT MADE (I) ON ACCOUNT OF PROFIT ATTRIBUTAB LE AND (II) ON PAYMENT OF MANAGEMENT CONSULTANCY CHARGES. THE ASSE SSEE IS ALSO IN APPEAL AGAINST THE COMPUTATION OF DEDUCTION U/S 10A OF THE ACT. 4. AT THE TIME OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISSUE IN GROUNDS OF APP EAL NO.2 & 3 ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 4 OF 10 HAD ARISEN IN THE EARLIER A.Y AS WELL AND THE COORD INATE BENCH OF THIS TRIBUNAL FOR THE A.Y 2010-11 HAS HELD THE ISSU E IN FAVOUR OF THE ASSESSEE. COPY OF THE SAID ORDER IS FILED BEFOR E US. 5. THE LEARNED DR, ON THE OTHER HAND, SUPPORTED THE ORDER OF THE DRP. 6. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD, WE FIND THAT THE ISSUE INVOLVED IS ADJUS TMENT TOWARDS PROFIT ATTRIBUTABLE TO THE ASSESSEE COMPANY IN CONN ECTION WITH SALE OF INTANGIBLE ASSETS BY THE ASSESSEE TO ITS AE , DQ ENTERTAINMENT (IRELAND). THE IPR WAS SOLD BY THE AS SESSEE TO ITS AE IN THE EARLIER A.YS AND THE ALP OF THE SAME HAD ARISEN FOR CONSIDERATION IN THE A.Y 2010-11. THE COORDINATE BE NCH OF THE TRIBUNAL AT PARA 15 OF ITS ORDER IN ITA NO.151/HYD/ 2015, DATED 22 ND JUNE, 2016 HAS HELD AS UNDER: 15. CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL FACTS ON RECORD AS WELL AS THE ORDERS OF REVENUE AUTHORITIES. THE FACTS ARE, T HE ASSESSEE HAD SOLD 'IP' (JUNGLE BOOK) TO ITS 'AE' ON 30/09/2009 AT THE DEVELOPMENT STAGE. IT WAS NOT FULLY DEVELOPED TO GENERATE REVENUE IMMEDIATELY. AS PER LD. AR, 'AE' WAS IN A POSITION TO GENERATE REVENUE IN THE LAST QUARTER OF 2009-10 I.E. JAN- MARCH, 2010. BUT TPO ADOPTED THE WHOLE REVENUE GENERATED BY 'AE' IN THE WHOLE YEAR TO ARRIVE THE PROFIT ARITHMETICALLY TO THE INDIAN ENTITY. THE MAI N ISSUE BEFORE US IS, WHETHER THE TPO JUSTIFIED TO DETERMINE THE PROFIT ATTRIBUTABLE TO INDIAN ENTITY (ASSESSEE) WHEN HE HIMSELF DETERMINED THE SALE CONSIDERATION OF IP (JUNGLE BOOK). WHEN THE TPO AGREED THAT THERE IS A OUTRIGHT SALE, THERE END S THE INTERNATIONAL TRANSACTION. NOW, TPO IS TRYING TO GO BEYOND SALES AND MAKING TP ADJUSTMENTS. WE ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 5 OF 10 ARE ASKING OURSELVES, WHETHER THERE IS ANY INTERNATIONAL TRANSACTION EXISTS. IN OUR CONSIDERED VIEW, THERE IS NO INTERNATIONAL TRANSACTION AFTER OUTRIGHT SALE. THERE IS NO INTERNATIONAL TRANSACTIO N EXISTS AS PER SECTION 92B OF THE ACT AS THERE IS NO TRANSACTION EXISTS BETWEEN ASSESSEE AND WITH IT'S AE. WE ARE INCLINED TO REJECT THE STAND OF THE TPO. 15.1 MOREOVER, AFTER THE COMPLETION OF THE SALE PROCESS, THE 'AE' HAS DONE TRANSACTION WITH THE OUTSIDERS OR OUTSIDE THE JURISDICTION OF THE INDIAN TERRITORY BUT THERE IS NO TRANSACTION DONE WITH THE ASSESSEE INVOLVING THE ABOVE IP (JUNGLE BOOK) TO CONSIDER THAT THERE EXISTS A INTERNATIONAL TRANSACTION. ONCE, THE IP IS SOLD AND ARM'S LENGTH PRICE IS DETERMINED, THE 'IP' BECOMES THE PROPERTY OF 'AE'. THE ASSESSEE HAS NO LOCUS STANDI TO CLAIM ANY BENEFIT NEITHER THE REVENUE. 15.2 THE REVENUE HAS GRIEVANCES ON THE ARRANGEMENT AND EXISTENCES OF GROUP COMPANIES. THERE IS NO DOUBT, THERE EXISTS TAX PLANNING. THERE CAN BE TAX PLANNING WITHIN THE FOUR CORNERS OF THE TAXATION LAWS. THERE IS ENOUGH MECHANISM IN THE EXISTING ACT AND ALSO THERE IS DTAA - ARRANGEMENT WITH IRELAND, WHICH WILL TAKE CARE OF THE SITUATION S OF TAX AVOIDANCE. THE REVENUE HAS NOT BROUGHT ANY COGENT EVIDENCE TO PROVE THAT THERE EXISTS ANY TAX AVOIDANCE. IN OUR CONSIDERED VIEW, THE ACTION OF TH E TPO IS NOT JUSTIFIED AND ACCORDINGLY, THE GROUNDS RAISED BY ASSESSEE ARE ALLOWED. 7. SINCE THE FACTS AND CIRCUMSTANCES OF THE CASE FO R THE A.Y BEFORE US ARE SIMILAR, RESPECTFULLY FOLLOWING T HE DECISION OF THE COORDINATE BENCH, WE ALLOW THE ASSESSEES GROUND OF APPEAL AND HOLD THAT THERE IS NO INTERNATIONAL TRANSACTION DUR ING THE RELEVANT FINANCIAL YEAR. GROUNDS OF APPEAL 2 & 3 ARE ACCORDI NGLY ALLOWED. 8. AS REGARDS GROUND OF APPEAL NO.4 RELATING TO MANAGEMENT CONSULTANCY FEE, THE LEARNED COUNSEL FOR THE ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 6 OF 10 ASSESSEE SUBMITTED THAT THIS ISSUE IS ALSO COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE A.Y 2008-09. 9. THE LEARNED DR, HOWEVER, SUPPORTED THE ORDER OF THE DRP. 10. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE MATERIAL ON RECORD, WE FIND THAT DURING THE A.Y 2012-13, THE ASSESSEE PAID AN AMOUNT OF RS.2,14,06,307 TO ITS AE AT MAURITIUS TOWARDS MANAGEMENT CONSULTANCY SERVICES RECEIVED. THE ASSES SEE HAD CLAIMED THAT THE PAYMENT WAS MADE TO THE BOARD OF D IRECTORS OF THE AE AS THEY WERE RENDERING INVALUABLE ADVICE AND GUIDANCE TO THE ASSESSEE COMPANY. THE TPO HOWEVER, HELD THAT TH E ASSESSEE FAILED TO FURNISH ANY EVIDENCE IN SUPPORT OF THE RE CEIPT OF THE BENEFIT FOR WHICH THE PAYMENT WAS MADE BY THE ASSES SEE TO ITS AE AND HENCE COMPUTED THE ALP AT NIL AND SUGGESTED T HE ADJUSTMENT. WE FIND THAT VERY SAME ISSUE HAD ARISEN IN THE ASSESSEES OWN CASE FOR THE A.Y 2008-09 IN ITA NO.6 2/HYD/2013 DATED 30 TH OCTOBER, 2015 AND AT PARAS 6.2 TO 6.7 THE TRIBUNAL HAS HELD AS UNDER: 6.2. AS CAN BE SEEN FROM THE ABOVE, THE TPO ANALYSE D THE ACCOUNTS OF DQ ENTERTAINMENT PLC AND DQE MAURITIUS IN ANALYZING THE NATURE OF PAYMENT. OUT O F THE TOTAL AMOUNT OF US$ 7,99,000 PAID, THE ACTUAL MANAGEMENT CONSULTATION CHARGES WERE ONLY US$ 4,27,000 ALONG WITH ADMINISTRATIVE AND AUDIT FEE OF US$ 14,000. AS PER THE AGREEMENT, THERE IS A MARKUP OF 5%. THIS EXPENDITURE ONLY CAN BE CONSIDERED, IN OUR VIEW, AS THE MANAGEMENT CONSULTANCY SERVICE FEE, WHEREAS THE FOREIGN EXCHANGE LOSS OF US$ 3,21,000 ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 7 OF 10 CANNOT BE CONSIDERED AS INTRA GROUP SERVICE. WE NOT ICE FROM THE DOCUMENTS PLACED ON RECORD THAT INSTEAD OF QUARTERLY BILLS BEING RAISED AS PER THE AGREEMENT, DQE MAURITIUS HAS RAISED ONLY ONE BILL FOR THE WHOLE OF THE YEAR, WHICH WAS PLACED AT PAGE 170 OF THE PAPER BOO K. AS CAN BE SEEN FROM THE DETAILS OF PAYMENTS MADE, PLACED AT PAGE 171 OF THE PAPER BOOK, THE AMOUNT OF US$ 799,174 CHARGED ON 31-03-08 WAS PAID IN THREE INSTALLMENTS OF US$ 3,00,000 ON 14-09-2010, US $ 1,99,174 ON 25-10-2010 AND US$ 3,00,000 ON 04-01- 2011. IT IS NOTICED THAT EVEN THOUGH INVOICE WAS RA ISED ON 31-03-2008 FOR WHOLE YEAR INSTEAD OF QUARTERLY BILLING, THE PAYMENTS WERE MADE FROM SEPTEMBER, 2010 TO JANUARY, 2011 WITH SUBSTANTIAL DELAY. THE REASONS FOR SUCH DELAYED PAYMENTS WERE NOT EXPLAINE D. THEREFORE, WE ARE OF THE VIEW, THAT IN THE GIVEN CIRCUMSTANCES, THE FOREIGN EXCHANGES LOSSES OR GAIN S IN THE HANDS OF DQE MAURITIUS CANNOT BE CONSIDERED AS SERVICES RENDERED BY THE DQE MAURITIUS TO ASSESSEE WHICH SHOULD BE ON IT'S OWN ACCOUNT. TO THE EXTENT OF THE ABOVE AMOUNT, WE ARE IN AGREEMENT WITH THE OBSERVATION OF THE TPO IN PARA 8.3 OF HIS LETTER DT . 08- 11-2012, THAT FOREIGN EXCHANGE LOSS DOES NOT PERTAI N TO ANY MANAGEMENT AND CONSULTANCY SERVICES. TO THAT EXTENT HIS ORDER HAS TO BE APPROVED. 6.3. WHAT THE TPO HAS MISSED IS WITH REFERENCE THE AMOUNTS OTHER THAN FOREIGN EXCHANGE LOSS. IN THE ABSENCE OF ANY COMPARABLE FIGURES AND IN THE ABSENC E OF ANY FURTHER ENQUIRY AND HAVING THE FACT THAT SER VICES HAVE BEEN RENDERED TO ASSESSEE AS ACCEPTED BY DRP ALSO, TPO CANNOT TAKE THE AMOUNT OF ALP AT NIL, IGNORING THE PAYMENT BY ASSESSEE OF US$ 4,27,000. A S PER THE AGREEMENT, ALL THE COSTS INCURRED BY THE DQ E MAURITIUS WITH 5% MARKUP HAD TO BE CHARGED TO ASSESSEE. THEREFORE, AS PER THE DETAILS FURNISHED B Y ASSESSEE BEFORE THE TPO, THE ACTUAL MANAGEMENT FEE OF US$ 4,27,000 WITH ADMINISTRATION CHARGES OF US$ 14000 AND MARKUP OF 5%, AT THE EXCHANGE VALUE AS ON THE DATE OF 31-03-2008, CAN BE CONSIDERED AS 'SERVI CE CHARGES' FOR THE INTRA GROUP SERVICES RENDERED. THI S CAN BE TAKEN AS ALP. THEREFORE, MODIFYING THE ORDER OF TPO, WE DETERMINE THE MANAGEMENT CONSULTANCY FEE AS DETAILED ABOVE AND AO IS DIRECTED TO MODIFY THE ORDER ACCORDINGLY. ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 8 OF 10 7. IN ARRIVING AT THE ABOVE, WE HAVE CONSIDERED THE OECD TRANSFER PRICING GUIDELINES 2010, CHAPTER-VII PERTAINING TO 'SPECIAL CONSIDERATIONS FOR INTRA GRO UP SERVICES'. CONSIDERING THE ASSESSEE'S AGREEMENT WIT H DQE MAURITIUS WHICH IN TURN HAS AN AGREEMENT WITH DQ ENTERTAINMENT PLC, AND THE REIMBURSEMENT OF COST FROM ONE COMPANY TO ANOTHER, WE AGREE WITH THE TPO' S OBSERVATION THAT FOREIGN EXCHANGE LOSS IN FINANCIAL TRANSACTIONS CANNOT BE CONSIDERED AS 'SERVICE CHARG E' FOR THE INTRA GROUP AND THEREFORE, WE AFTER CONSIDE RING THE FACTS OF THE CASE, RESTRICT THE AMOUNT TO THE ACTUAL MANAGEMENT FEES CHARGED BY THE DQE MAURITIUS ALONG WITH OTHER COST OF ADMINISTRATION AND AUDIT AND MAR K UP AT 5%. 11. SINCE THE FACTS AND CIRCUMSTANCES ARE THE SAME FOR THE A.Y BEFORE US, RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH (TO WHICH BOTH OF US ARE SIGNATORIES), WE ALL OW THE ASSESSEES GROUND OF APPEAL. 12. AS REGARDS GROUNDS OF APPEAL NO. 5 TO 8, THE LE ARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT WITHOUT PRE JUDICE TO HIS GROUND THAT THIS EXPENDITURE IS NOT TO BE REDUCED F ROM THE EXPORT TURNOVER, IF A DIRECTION IS GIVEN TO EXCLUDE THE SA ME FROM EXPORT TURNOVER AS WELL, THE ASSESSEE WOULD NOT HAVE ANY G RIEVANCE. HE PLACED RELIANCE UPON THE JUDGMENT OF THE SPECIAL BE NCH OF THE TRIBUNAL AT CHENNAI IN THE CASE OF ITO VS. M/S. SAK SOFT LTD REPORTED IN (313 ITR (AT) 353 AND ALSO THE DECISION OF THE HON' BLE BOMBAY HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX-8 VS. M/S. GEM PLUS JEWELLERY INDIA LTD, DATED 23 JUN E, 2010 IN SUPPORT OF HIS CONTENTION. ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 9 OF 10 13. THE LEARNED DR, HOWEVER, SUPPORTED THE ORDERS O F THE AUTHORITIES BELOW. 14. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE MATERIAL ON RECORD, WE FIND THAT THIS ISSUE IS COVERED IN FA VOUR OF THE ASSESSEE BY THE DECISIONS RELIED UPON BY THE LEARNE D COUNSEL FOR THE ASSESSEE. IN VIEW OF THE SAME, WE DIRECT THE AO TO EXCLUDE THE INSURANCE AND TRAVELLING AND CONVEYANCE EXPENSES BO TH FROM THE EXPORT TURNOVER AS WELL AS THE TOTAL TURNOVER FOR T HE PURPOSE OF COMPUTATION OF EXEMPTION U/S 10AA OF THE ACT. THERE FORE, GROUND OF APPEAL NO 5 IS REJECTED AND GROUNDS OF APPEAL NO .6 TO 8 ARE ALLOWED. 15. GROUND NO.9, AGAINST THE LEVY OF INTEREST U/S 2 34B OF THE ACT, IS REMITTED TO THE FILE OF THE AO WITH A D IRECTION TO THE AO TO GIVE CONSEQUENTIAL RELIEF, IF ANY, TO THE ASSESS EE IN ACCORDANCE WITH LAW. 16. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH JANUARY, 2018. SD/- SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 12 TH JANUARY 2018. VINODAN/SPS ITA NO 441 OF 2017 DQ ENTERTAINMENT INTE RNATIONAL LTD HYDERABAD. PAGE 10 OF 10 COPY TO: 1 PRASAD & PRASAD, CAS, FLAT NO.301, MJ TOWERS, 8-2 -698 ROAD NO.12, BANJARA HILLS, HYDERABAD 500034 2 ACIT, CIRCLE 14(1) HYDERABAD 3 DISPUTE RESOLUTION PANEL-1, G-18 CENTRAL REVENUE BUILDING, QUEENS ROAD, BENGALURU 560001 4 DIRECTOR OF INCOME TAX (T.P.) HYDERABAD 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER