ACIT, Faridabad V. M/s. BCEOM (India) P. Ltd., Faridabad

ITA 4710/DEL/2012

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 7995 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 7 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-04-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I1
• Next Hearing Date: 12-06-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 04-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANDEEP KR MISHRA
• Keywords: Related party transaction; Transfer pricing; International transaction; Bad and doubtful debts; Set aside
• Section: 143(3)

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH I - 2 : NEW DELHI BEFORE SHRI H.S.SIDHU , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 4710/DEL/2012 & 2316 /DEL/2015 (ASSESSMENT YEAR: 2007 - 08 & 2009 - 10 ) ACIT. CIRCLE - I, BLOCK I - B, FARIDABAD VS. M/S. BCEOM (INDIA)P. LTD, (NOW KNOWN AS EGIS INDIA CONSULTING ENGINEERS PVT. LTD), 12/6, SAFFRON SQUARE, DELHI MATHURA ROAD, FARIDABAD PAN: AACCB6390F (APPELLANT) (RESPONDENT) ITA NO. 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2008 - 09 AND 2010 - 11 ) DCIT, CIRCLE - I, FARIDABAD VS. M/S. BCEOM (INDIA)P. LTD, (NOW KNOWN AS EGIS INDIA CONSULTING ENGINEERS PVT. LTD), 12/6, SAFFRON SQUARE, DELHI MATHURA ROAD, FARIDABAD PAN: AACCB6390F (APPELLANT) (RESPONDENT) REVENUE BY : SHRI SANDEEP KR. MISHRA, SR. DR ASSESSEE BY: SHRI NITIN NARANG, AR SHRI AMIT ARORA, CA MS. TA RIMI NIJHARA, AR DATE OF HEARING 04/02 / 2019 DATE OF PRONOUNCEMENT 22 / 0 4 / 2019 O R D E R PER PRASHANT MAHARISHI, AM, 1 . THIS IS THE BUNCH OF FOUR APPEALS IN CASE OF AN ASSESSEE FOR FOUR DIFFERENT YEARS INVOLVING SIMILAR GROUND OF APPEAL IN DISPUTE AND THEREFORE THEY ARE HEARD TOGETHER AND DISPOSED OF BY THIS COMMON ORDER. 2 . FOR ASSESSMENT YEAR 2007 08 IN ITA NO. 4710/ DEL /2012 THE LEARNED ASSISTANT COMMISSIONER OF INCOME TAX , CIRCLE 1, FARIDABAD (THE LEARNED ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 2 AO) HAS FILED THIS APPEAL AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX ( APPEALS ), FARIDABAD [ THE LEARNED CIT (A)] DATED 0 9/ 0 7/2012 WHEREIN FOLLOWING GROUNDS OF APPEAL HAVE BEEN RAISED : - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD C IT(A) HAS ERRED ON FACTS AND ON LAW IN DELETING THE ADDITION OF RS. 4,46,29,132/ - MADE BY THE AO ON ACCOUNT OF ARMS LENGTH PRICE OF INTERNATIONAL TRANSACTION U/S 92CA(3) OF THE ACT IN VIEW OF THE FINDINGS OF THE TPO ORDER DATED 04.10.2010 AND AS PER THE PROVISIONS OF 92CA(4) OF THE IT ACT. 3 . THE BRIEF FACTS OF THE CASE SHOWS THAT ASSESSEE, A COMPANY ENGAGED IN THE BUSINESS OF ENGINEERING CONSULTANCY SERVICES AND IS PROVIDING CONSULTANCY, PROJECT MONITORING AND SUPERVISING SERVICES , IN THE 2 ND YEAR OF ITS BUSINESS, FILED ITS RETURN OF INCOME ON 31/10/2007 DECLARING NIL INCOME. THE ASSESSEE HAS ENTERED INTO AN INTERNATIONAL TRANSACTION WITH ITS ASSOCIATED ENTERPRISE OF CONTRACT FOR TECHNICAL SERVICES FROM ITS ASSOCIATED ENTERPRISE. THE INTERNATIONAL TRANS ACTION WAS REFERRED BY THE LEARNED ASSESSING OFFICER TO THE LEARNED TRANSFER PRICING OFFICER FOR DETERMINATION OF ITS ARMS - LENGTH PRICE. THE LEARNED TRANSFER PRICING OFFICER DETERMINE D THE A LP OF THE TRANSACTION V IDE ORDER DATED 0 4/10/2009 AND PROPOSED AN ADJUSTMENT OF RS. 44629132 / - . THE LEARNED AO FURTHER MADE AN ADDITION OF RS. 1177601 / - ON ACCOUNT OF LATE PAYMENT OF THE PROVIDENT FUND. THE LEARNED ASSESSING OFFICER PASSED AN ORDER U/S 143 (3) OF THE ACT READ WITH SECTION 1144C OF THE INCOM E TAX ACT DATED 0 7/ 0 1/2011. THE ASSESSEE CHALLENGED THE SAME BEFORE THE LEARNED CIT (A) . THE LEARNED CIT (A) V IDE ORDER DATED 0 9/ 0 7/2012 PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. THEREFORE , THE AO AGGRIEVED WITH THAT ORDER HAS PREFERRED THIS APPEAL. 4 . THE S OLITARY GROUND OF APPEAL IS WITH RESPECT TO DELETING THE ADDITION OF RS. 44629132/ MADE BY THE LEARNED ASSESSING OFFICER ON ACCOUNT OF ARMS - LENGTH PRICE OF INTERNATIONAL TRANSACTION A S DETERMINED BY THE LEARNED TRANSFER PRICING OFFICER VIDE ORDER DATED 4 /10/2010. 5 . THE LEARNED DEPARTMENTAL REPRESENTATIVE PLACED THE WRITTEN SUBMISSION DATED 9/5/2018 AND REITERATED THE SAME. THE MAIN ARGUMENT OF THE ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 3 LEARNED DEPARTMENTAL REPRESENTATIVE IS THAT THE LEARNED CIT (A) HAS ACCEPTED INTERNAL TNMM BENCHMARKING OF THE ASSESSEE WITHOUT APPRECIATING THE REASONS GIVEN BY THE LEARNED TRANSFER PRICING OFFICER IN PARA NO. 3.1 OF HIS ORDER FOR REJECTION OF THE INTERNAL TNMM. IT WAS FURTHER STATED THAT TPO H AS CLEARLY HELD THAT THE ASSOCIATED ENTERPRISE AND NON - ASSOCIATED ENTE RPRISE SEGMENTS ARE NOT COMPARABLE AS THE SERVICE INCOME IS ONLY RS. 17,900,000 / - IN NON AE SEGMENT COMPARED TO SERVICE INCOME OF RS. 192,000,000 / - IN THE ASSOCIATED ENTERPRISE SEGMENT. IT WAS FURTHER STATED THAT TRANSFER PRICING OFFICER HAS FURTHER HELD T HAT IT IS NOT POSSIBLE FOR THE SEGMENT HAVING REVENUE OF ONLY 8.5% OF THE TOTAL REVENUE TO TAKE DOWN THE OTHER SEGMENT FROM THE PROFIT OF 10% ON ENTITY LEVEL TO LOSS . HE SUBMITTED THAT SEGMENTAL ACCOUNT HAS BEEN DRAWN WITH AN INTENTION TO ESTABLISH ITS TRANSACTIONS WITH ASSOCIATED ENTERPRISE AT ARMS - LENGTH. THE LEARNED DR FURTHER RELIED UPON THE DECISION OF THE COORDINATE BENCH IN CASE OF FCIOEN CONNECTORS LTD VS ACIT 77 TAXMANN.COM 22 3 WHEREIN IT HAS BEEN HELD THAT INTERNAL TNMM CANNOT BE ADOPTED IN CASE OF HUGE DIFFERENCE IN TURNOVER OF ASSOCIATED ENTERPRISE AND NON - ASSOCIATED ENTERPRISE. IT WAS FURTHER STATED THAT AUTHENTICITY OF THE ABOVE SEGMENTAL ACCOUNT IS HIGHLY DOUBTFUL AS THE ASSESSEE ITSELF HAS PROVIDED DIFFERENT SEGMENTAL ACCOUNTS IN AUDITED ACCOUNTS WHEREIN THE ASSESSEE HAS DISCLOSED MARGIN OF 1.36% AND ( - ) 16.10% FOR THE AE AND N ON - AE SEGMENT RESPECTIVELY. HE FURTHER STATED THAT IN TRANSFER PRICING STUDY REPORT THE ASSESSE E HAS DISCLOSED AND MARGIN OF 10.6% AND ( - ) 50.1% OF THE AE AND NON AE SEGMENT RESPECTIVELY. ASSESSEE HAS FAILED TO EXPLAIN THIS HUGE DIFFERENCE IN COMPUTATION OF MARGIN OF THE ABOVE TWO SEGMENTS. HE FURTHER STATED THAT THE ASSESSEE HAS DISCLOSED THAT PR OFIT OF RS. 844,000 / - FROM THE RECEIPT OF RS. 17,900,000 / - FROM THE NON AE SEGMENT WHICH IS COMPLETELY AT VARIANCE WITH THE ABOVE TWO SEGMENTAL ACCOUNTS WHERE THE ASSESSEE IS INCURRING LOSS IN NON ASSOCIATED ENTERPRISE SEGMENT. IT WAS FURTHER ARGUED THAT T HE ASSESSEE HAS CLAIMED BUSINESS DEVELOPMENT COST OF RS. 16,400,000 / - ON TOTAL REVENUE OF RS. ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 4 17,900,000 / - IN THE NON AE SEGMENT AND HAS NOT FURNISHED ANY DETAILS REGARDING THOSE EXPENSES. HE SUBMITTED THAT ASSESSEE HAS ALSO CLAIMED RS. 28,81,000 / - ON ACC OUNT OF AMP EXPENDITURE FROM NON AE TRANSACTIONS IN PROFIT AND LOSS ACCOUNT. HE THEREFORE STRONGLY STATED THAT THE RELIABILITY OF THE ABOVE TWO SEGMENTS IS HIGHLY DOUBTFUL AND CANNOT BE ACCEPTED FOR INTERNAL BENCHMARKING . LEARNED DR FURTHER STATED THAT TH ERE IS NO REFERENCE ABOUT THE KIND OF SERVICES PROVIDED TO THE NONASSOCIATED ENTERPRISE AND THEIR FUNCTIONAL ANALYSIS IS ALSO NOT AVAILABLE AND THEREFORE THEY CANNOT BE COMPARED WITH THE TRANSACTIONS OF ASSOCIATED ENTERPRISE. IT WAS FURTHER STATED THAT TH E NON - AE SEGMENT CONSIST OF 7 DIFFERENT PARTIES AND THEREFORE UNLESS THEIR TRANSACTIONS ARE ANALYSED AND FOUND TO BE COMPARABLE WITH THE TRANSACTIONS OF THE ASSOCIATED ENTERPRISE , INTERNAL TNMM CANNOT BE ACCEPTED. EVEN OTHERWISE , HE SUBMITTED THAT THE LEA RNED CIT (A) ACCEPTED NTPC AS A VALID COMPARABLE BY HOLDING THAT THIS COMPANY IS FUNCTIONALLY COMPARABLE WITHOUT PROVIDING ANY REASON. HE STATED THAT NTPC IS FUNCTIONALLY COMPLETELY DIFFERENT ON ACCOUNT OF THE FACT THAT IT IS PROVIDING ADVISORY AND CONSULTANCY SERVICES AND IS ALSO IN VOLVED IN THE IMPLEMENTATION OF RURAL ELECTRIFICATION WORK ON TURNKEY BASIS. EVEN OTHERWISE , IT IS A GOVERNMENT PUBLIC SECTOR UNDERTAKING , THEREFORE , IT IS NOT A GOOD COMPARABLE , PROFITABILITY IS NOT THE MAIN CONCERN. IT WAS FURTHER STATED THAT THE LEARN ED CIT (A) HAS REJECTED 7 OUT OF 8 COMPARABLES SELECTED BY TPO WITHOUT ASSIGNING ANY REASON AND THEREFORE ACCORDING TO HIM THE DECISION OF THE CIT A IS PERVERSE AND FIT TO BE SET ASIDE. WITH RESPECT TO THE CERTIFICATE OF CHARTERED ACCOUNTANT HE SUBMITT ED THAT SAME IS SUBMITTED ONLY FOR ASSESSMENT YEAR 2007 08 AND NOT FOR OTHER YEARS. 6 . THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED THAT TPO HAS ACCEPTED THE SEGMENTAL ACCOUNT SUBMITTED BY THE ASSESSEE AS PER PARA NO. 3.1 OF HIS ORDER . HE FURTHER REFERRE D TO PAGE NO. 32 OF THE ORDER OF THE LEARNED CIT (A) TO SHOW THAT THE LEARNED CIT APPEAL HAS CONSIDERED ALL THE ARGUMENTS RAISED . HE ALSO REFERRED TO PAGE NUMBER 115 OF HIS PAPER BOOK ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 5 WHICH IS AS TRANSFER PRICING STUDY REPORT WHEREIN IT IS SUBMITTED THAT TH E COMPANY DOES NOT INCUR ANY MARKETING OR BUSINESS DEVELOPMENT EXPENSES FOR BUSINESS PROCURED FROM ASSOCIATED ENTERPRISE , HOWEVER THE COMPANY INCURRED SUBSTANTIAL COST TOWARDS MARKETING AND BUSINESS DEVELOPMENT EXPENSES FOR PROCURING BUSINESS FROM INDEPEND ENT 3 RD PARTIES. HE THEREFORE SUBMITTED THAT MARKETING COST IS FOR THE NON - AE BUSINESS ONLY. HE THEREFORE SUBMITTED THAT THERE IS NO INFIRMITY IN THE ORDER OF THE LEARNED CIT ( A ) . 7 . WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTION AND PERUSED THE ORDERS OF THE LEARNED AO, TPO AND THE LEARNED CIT (A) . THE BRIEF FUNCTIONAL PROFILE OF THE ASSESSEE SHOWS THAT IT IS ENGAGED IN RENDERING SERVICES OF TECHNICAL ASSISTANCE, PROJECT MANAGEMENT, UNDERTAKING OF STUDIES IN THE FIELD OF AUDIT, CONSULTANCY, ENGINEERING, SUPPLYING OF QUALIFIED EXPERTS, PARTICIPATION INVOLVES SUPERVISION, DESIGN, DRAFT, INSPECTION, ESTIMATE, SURVEY, IMPROVISATION IN THE DESIGNING, SUPPLY, CONSTRUCTION, INSTALLATION , OPERATION OR MAINTENANCE OF ANY STRUCTURE, ROADS AND HIGHWAYS ET CETERA. FOR BENCH MAKING OF INTERNATIONAL TRANSACTION OF RENDERING OF TECHNICAL AND CONSULTANCY SERVICES TO ITS ASSOCIATED ENTERPRISE ASSESSEE ADOPTED TRANSACTIONAL NET MARGIN METHOD (TNMM) AS THE MOST APPROPRIATE METHOD (MAM). IT SELECTED 3 COMPARABLES WHOSE ARIT HMETIC MEAN OF THE PROFIT LEVEL INDICATOR (PLI) OF OPERATING PROFIT/TOTAL COST WAS 1.68% , WHEREAS THE ASSESSEE S PROFIT LEVEL INDICATOR WAS 1.36% AND THEREFORE IT WAS STATED THAT ITS INTERNATIONAL TR ANSACTIONS ARE AT ARMS - LENGTH. THE ASSESSEE COMPUTED ITS PROFIT LEVEL INDICATOR WITH RESPECT TO THE TRANSACTIONS WITH ASSOCIATED ENTERPRISE AND NONASSOCIATED ENTERPRISE AS UNDER: - PARTICULARS ASSOCIATED ENTERPRISE NON - ASSOCIATED ENTERPRISE OPERATING INCOME 192064997 17959145 OPERATING EXPENDITURE 189491737 21404968 OPERATING PROFIT 2573260 ( - ) 3445823 NET CONTRIBUTION 1.36% ( - ) 16.10% ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 6 MARGIN 8 . THE LEARNED TRANSFER PRICING OFFICER CHALLENGED THE ABOVE MARGIN OF 1.36 PERCENTAGE EARNED BY THE ASSESSEE FROM ASSOCIATED ENTERPRISES AND A NEGATIVE MARGIN OF ( - ) 16.10 % FROM NON - ASSOCIATED ENTERPRISE. THEREFORE , THE SHOW CAUSE NOTICE WAS ISSUED. IN RESPONSE TO THE SHOW CAUSE NOTICE , ASSESSEE ABANDONED EARLIER 3 COMPARABLES CHOSEN BY IT , AND CAME OUT WITH 4 DIFFERENT ALTOGETHER NEW COMPARABLES STATING THAT THEIR A VERAGE PROFIT LEVEL INDICATOR OF OPERATING PROFIT/OPERATING EXPENDITURE IS( - ) 12.06%. ASSESSEE CAME OUT WITH A NEW INTERNAL SEGMENTAL PROFIT AND LOSS ACCOUNT BETWEEN NON - AE AND AE AS UNDER: - PARTICULARS NONASSOCIATED ENTERPRISE ASSOCIATED ENTERPRISE PROFI T AND LOSS ACCOUNT PROJECT INCOME 17959145 192064997 210024142 DIFFERENCE IN EXCHANGE 02/05/2007 219309 239816 AMOUNT WRITTEN BACK 2528 27031 29559 TOTAL OPERATING INCOME 17982179 192311338 210293517 OTHER INCOME 19607 209691 229298 TOTAL 18001786 192521029 210522815 EXPENDITURE SALARY 5646209 47108798 52755006 PROFESSIONALS 1966600 24361012 26327612 INDIRECT EXPENSES 22169953 65675620 87845572 COMMON COST NOW ARE LOCATED 3514086 37581570 41095656 OTHER EXPENSES 2737065 2737065 TOTAL OPERATING EXPENSES 36033912 174726999 210760912 LOSS ON SALE OF ASSETS 13039 139445 152484 ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 7 PROVISION FOR DOUBTFUL DEBTS 163479 1748335 1911814 TOTAL EXPENDITURE 36210430 176614779 212825210 NET PROFIT/(LOSS) (18208644) 15906249 2302395 9 . ON THE BASIS OF ABOVE SEGMENTATION OF THE PROFIT AND LOSS ACCOUNT , ASSESSEE PREPARED THE INTERNAL COMPARABLE PROFITABILITY COMPARABILITY ANALYSIS OF THE TRANSACTION WITH ASSOCIATED ENTERPRISE AND NON - ASSOCIATED ENTERPRISE AS UNDER: - PARTICULARS ASSOCIATED ENTERPRISE S EGMENT NONASSOCIATED ENTERPRISE SEGMENT OPERATING INCOME 192311338 17982179 OPERATING EXPENDITURE 174726999 36033912 OPERATING PROFIT 17584338 (18021733) NET PROFIT MARGIN 10.06% (50.1)% 10 . THE LEARNED TPO QUESTIONED THE ABANDONING ORIGINAL SEARCH BY THE ASSESSEE IN THE TRANSFER PRICING STUDY REPORT AND ALSO THE SEGMENTATION. THEREFORE , HE REJECTED THE SEGMENTATION CREATED BY THE ASSESSEE FOR THE REASON THAT THERE IS AN INAPPROPRIATE INDIRECT EXPENSES AL LOCATION, NON - AL LOCATION OF OTHER EXPENSES ETC. THEREFORE , THE LEARNED TRANSFER PRICING OFFICER, COMPUTED THE PROFIT LEVEL INDICATOR OF ASSESSEE TAKING THE TOTAL OPERATING INCOME OF RS. 2 10293517/ AND THE TOTAL OPERATING EXPENSES OF RS. 2 10760912 / - AND THEREBY DERIVING OPERATING LOSS OF RS. 467395 / - A ND STATED THAT THE PROFIT LEVEL INDICATOR OF OPERATING PROFIT/OPERATING EXPENSES OF THE ASSESSEE IS (0.22) PERCENTAGE. THEREAFTER HE SELECTED THE COMPARABLES AFRESH, ALLOWED THE ASSESSEE TO OBJECT THEM AND ULTIMATELY SELECTED 8 COMPARABLES , WHOSE PROFIT LE VEL INDICATOR OF OPERATING PROFIT/OPERATING EXPENDITURE WAS FOUND TO BE 2 4.91 % AND THEN , AGAINST THE TOTAL PRICE PAID OF RS. 192064997/ ARMS - LENGTH PRICE AT RS. ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 8 2 36694129/ AND ACCORDINGLY PROPOSED AN ADJUSTMENT OF RS. 44629132 / - . CONSEQUENTLY , THE ASSE SSMENT ORDER U/S 143 (3) OF THE ACT WAS PASSED ON 7/1/2011 DETERMINING THE TOTAL INCOME OF THE ASSESSEE OF RS. 45806733 / - AGAINST THE RETURNED INCOME OF RS. NIL . THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LEARNED CIT (A) . THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IN PARA NO. 6.1 OF HIS ORDER HAS ACCEPTED THAT INTERNAL UNCONTROLLED TRANSACTIONS ARE THE GOOD COMPARABLES AFTER RELYING UPON THE OECD GUIDELINES. HE THEREFORE REACHED CONCLUSION THAT THESE GUIDELINES SUGGEST PREFERENCE FOR INTERNAL C OMPARABLE OF ASSESSEE. HE RELIED ON THE DECISION OF THE COORDINATE BENCH IN CASE OF BIRLA SOFT INDIA LTD VS DCIT , WHEREIN IT HAS BEEN HELD THAT THE ASSESSEE WAS JUSTIFIED IN UNDERTAKING INTERNAL COMPARISON ON STANDALONE BASIS BY PLACING ON RECORD WORKING O F OPERATING PROFIT MARGIN FROM INTERNATIONAL TRANSACTION WITH ITS ASSOCIATED ENTERPRISE AND TRANSACTIONS WITH UNCONTROLLED PRICES UNDERTAKEN IN SIMILAR FUNCTIONAL AND ECONOMIC SCENARIO. THEREFORE , HE HELD THAT SUCH INTERNAL COMPARISON IS VALID IN ALL THE M ETHODS. HE FURTHER HELD THAT LEARNED TRANSFER PRICING OFFICER HAS NOT GIVEN ANY REASON THAT ECONOMIC SCENARIO OF CONTROLLED AND UNCONTROLLED TRANSACTIONS WERE DIFFERENT. IN VIEW OF THIS , HE HELD THAT THE ATTEMPT SHOULD ALWAYS BE MADE TO DETERMINE THE ARM S - LENGTH PRICE OF CONTROLLED TRANSACTION BY COMPARING THE SAME WITH INTERNAL UNCONTROLLED TRANSACTIONS UNDERTAKEN IN SIMILAR ECONOMIC SITUATIONS. WITH RESPECT TO THE SEGMENT - WISE RESULT HE STATED THAT IN PARA NUMBER 3.1 OF THE ORDER OF THE LEARNED TRANS FER PRICING OFFICER, HE HAS GIVEN CERTAIN REASONS FOR REJECTION OF THE SEGMENTAL INCOME AND THE MARKETING EXPENSES , HOWEVER HE NOTED THAT TPO HAS GIVEN A FINDING THAT SEGMENTAL ACCOUNTS HAVE BEEN DRAWN IN SUCH A MANNER AS TO HIDE THE ENTITY LEVEL LOSS , WHE REAS , THE CONTENTION OF THE ASSESSEE WAS THAT THE EXPENSES WERE DISTRIBUTED MAINLY ON THE BASIS OF ACTUAL S IS AND ON THE BASIS OF TURNOVER. THE ASSESSEE ALSO FURNISHED STATEMENT OF SEGMENTAL PROFITABILITY AFTER CONSIDERING THE DIRECT AND INDIRECT EXPENSES ATTRIBUTABLE TO EVERY PROJECT AND A L LOCATION WAS BASED ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 9 ON ACTUAL EXPENSES. AFTER RECORDING THE FINDING THAT THE BUSINESS ACTIVITY OF THE COMPANY WAS TECHNICAL CONSULTANCY IN A SPECIALISED FIELD AND THE MAJOR CUSTOMERS ARE MOSTLY GOVERNMENT ORGANISATIONS AND ALL THE BUSINESSES WERE ALLOTTED ON THE BASIS OF OPEN TENDERS. FOR WIDE DIFFERENCE BETWEEN THE REVENUE EARNED WITH PE AND WITH THE NON - AE COMPANIES , AND THE MARKETING EXPENDITURE HE HELD THAT THERE MAY BE NO CORRELATION BETWEEN THE REVENUE EARNED ON T HE MARKETING EXPENDITURE IN THE INITIAL FEW YEARS OF THE DEVELOPMENT OF THE BUSINESS CYCLE. HE FURTHER APPROVED THE ARGUMENT OF THE ASSESSEE THAT IN ORDER TO PROCURE BUSINESS FROM THE ASSOCIATED ENTERPRISE , THE APPELLANT DID NOT INCUR ANY ADVERTISEMENT EX PENSES HOWEVER FOR THE PURPOSE OF ACQUIRING BUSINESS WITH NON - AE ASSESSEE NEED TO INCUR THESE EXPENDITURE . THEREFORE, THEY ARE PROPERLY ALLOCATED TO THE NON - AE SEGMENT. HE FURTHER HELD THAT AS LONG AS THE SERVICES ARE SIMILAR , SEGMENTAL RESULTS WILL HAVE T O BE ACCEPTED. HE FURTHER HELD THAT THE LEARNED TPO WHILE REJECTING THE REVISED SEGMENTAL FIGURES , HAS ACCEPTED THE ORIGINAL SEGMENTAL FIGURES AND ALSO USED THE MARGIN OVER THE COST AS GIVEN BY THE ASSESSEE. THEREFORE HE HELD THAT ON BOTH THE COUNTS , THE SEGMENTAL RESULTS OF THE ASSOCIATED SEGMENT ARE BETTER THAN NON - AE SEGMENT , AND INTERNAL BENCHMARKING ANALYSIS UNDER THE SEGMENTAL RESULTS PREPARED USING THE VALID ALLOCATION KEY IS JUSTIFIED. ON CAREFUL ANALYSIS OF THE DECISION OF THE CIT(A) WE FIND THAT HE HAS GIVEN A VALID REASONS FOR ACCEPTING THE SEGMENTAL RESULTS. FURTHER WITH RESPECT TO ALL THE ARGUMENTS RAISED BY THE LEARNED DEPARTMENTAL REPRESENTATIVE , THERE IS AN ANSWER IN THE ORDER OF THE LEARNED CIT (A) WHICH CANNOT BE DISLODGED WITHOUT HA VING ANY FACTUAL INFIRMITY IN THE SAME. FURTHER, ON READING THE TRANSFER PRICING STUDY REPORT PREPARED BY THE ASSESSEE, IT IS MENTIONED THAT ASSESSEE INCURRED MARKETING EXPENSES ONLY FOR PROCURING BUSINESS FROM NON AE CUSTOMERS WITHOUT GIVING ANY FINDING T HAT SUCH IS NOT THE FACT THE FACTUAL STATEMENT CANNOT BE IGNORED. FURTHER, LD TPO ALSO DID NOT STATE WHAT IS THE DIFFERENCE BETWEEN THE FUNCTIONS PERFORMED, ASSETS DEPLOYED AND RISK ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 10 ASSUMED BY THE ASSESSEE IN ITS TRANSACTIONS WITH AE AND NON - AE CUSTOMERS. THE TP STUDY REPORT OF THE ASSESSEE STATES THAT THER IS NO SUCH FUNCTIONAL DISSIMILARITY. SAME IS ALSO THE FINDING OF LD CIT(A) WHICH IS ALSO NOT CONTROVERTED BEFORE US. REGARDING ALLOCATION KEYS ADOPTED BY ASSESSEE, LD TPO HAS NOT STATED THAT HOW SAME ARE INCORRECT. THEREFORE , THERE IS NO INFIRMITY IN THE ORDER OF THE LEARNED CIT (A) WE CONFIRM THE SAME. IN VIEW OF THIS , WE DISMISS GROUND NUMBER 1 OF THE APPEAL OF THE AO. 11 . ACCORDINGLY ITA NO. 4710/ DEL /2012 FOR ASSESSMENT YEAR 2007 - 08 PREFERRED BY THE LEARNE D ASSESSING OFFICER IS DISMISSED. 12 . NOW WE COME TO THE APPEAL PREFERRED BY THE LEARNED ASSESSING OFFICER FOR ASSESSMENT YEAR 2008 - 09 IN ITA NO. 583/ DEL /2014 WHEREIN FOLLOWING GROUNDS OF APPEAL HAVE BEEN RAISED : - (1) LD. CIT(A) HAS ERRED IN ALLOWING THE INTERNAL TNMM APPLIED BY THE ASSESSEE WHICH WASN'T FORMING PART OF THE AUDIT FINANCIALS AND TP REPORT. MOREOVER, IT ALSO IGNORED THAT TP REPORT OF THE ASSESSEE HAS A SET OF 07 COMPARABLE COMPANIES WITH MEAN MARGIN OF 16.45% WHEREAS ASSESSEE'S MARGIN WERE M ERELY 3.66% (OP/OR). FURTHER, TO ADD HERE THAT ASSESSEE HAS COME FORWARD WITH A NEW SEARCH BEFORE THE TPO WITH A SET OF 05 COMPARABLE WITH MEAN MARGIN OF 3.52%. BEFORE THE TPO ASSESSEE HASN'T DEMONSTRATED HOW THE TP REPORT PREPARED AS PER REQUIREMENT OF ACT AND RULES OF INCOME TAX CAN BE SIDELINED WITH NEW SET OF COMPARABLES SO PRODUCED. LD. CIT(A) IS ABSOLUTELY SILENT ON THE ISSUE. (2 ) LD. CIT(A) ALSO ERRED ON ALLOWING THE PLEA OF ASSESSEE, MERELY ON THE SUBMISSION OF THE ASSESSEE THAT COMPARABLE COMPANI ES SELECTED BY THE TPO IN ITS ORDER WITHOUT REMANDING BACK THE MATTER TO THE TPO. THE LD. CIT(A) HAS ACCEPTED ASSESSEE'S PLEA OF REJECTING A COMPARABLE HAVING RPT OF 15%. IN THIS REGARD JUDICIAL ITAT DECISION IN THE CASE OF M/S GLOBAL LOGIC INDIA P. LTD. ( 2011 TTI - 35 - ITAT - DEL - TP ), M/S ADPP LIMITED (2001 - TO - 44 - ITAT - HRY - TP) AND ST MICROELECTRONICS (2011 - TII - 63 - RTAT - DEL - TP), WHERE IT IS UPHELD THAT THRESHOLD LIMIT OF RPT SHOULD BE 25%. AND IN CASE OF TWO OTHER COMPARABLES, REASONS GIVEN BY THE ASSESSEE THAT CU RRENT YEAR FINANCIALS WERE NOT AVAILABLE WHICH IS FACTUALLY INCORRECT. THE ANNUAL REPORTS OF ALL THE COMPARABLE COMPANIES WERE VERY MUCH AVAILABLE ON THE PUBLIC DOMAIN. THUS, LD. CIT(A) GROSSLY ERRED IN DELETION OF TP ADJUSTMENT MADE BY THE TPO WHICH WAS S CIENTIFIC AND ACCURATE IN ALL RESPECT. ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 11 (3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DELETING THE ADDITION OF RS.7,52,66,923/ - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ARM'S LENGTH PRICE OF INTERN ATIONAL TRANSACTION U/S 92CA(3) OF THE ACT IN VIEW OF FINDINGS OF THE TPO ORDER DATED 28.10.2011 AND AS PER THE PROVISIONS OF SECTION 92CA(4) OF THE I.T. ACT. 13 . THE ASSESSEE FILED ITS RETURN OF INCOME DECLARING INCOME OF RS. 222615/ ON 26/9/2008. THE ASSESSMENT U/S 143(3) READ WITH SECTION 144C OF THE ACT WAS COMPLETED AT RS. 75489540 / - ON 26/12/2011 WHEREIN THE ADDITION OF RS. 75266923/ WAS MADE. AGAINST THE ORDER OF THE LEARNED ASSESSING OFFICER, ASSESSEE PREFERRED AN A PPEAL BEFORE THE LEARNED CIT (A), FARIDABAD WHO ALLOWED THE APPEAL AND THEREFORE REVENUE IS IN APPEAL BEFORE US. THE ONLY DISPUTE IS AN ADDITION OF RS. 75266923/ ON ACCOUNT OF ARMS - LENGTH PRICE OF INTERNATIONAL TRANSACTION. THE ASSESSEE ENTERED INTO AN INTERNATIONAL TRANSACTION WITH ITS ASSOCIATED ENTERPRISE OF RENDERING OF TECHNICAL AND CONSULTANCY SERVICES TO THE ASSOCIATED ENTERPRISE. THE ASSESSEE SELECTED THE TNMM AS THE MOST APPROPRIATE METHOD FOR BENCHMARKING THE INTERNATIONAL TRANSACTION AFTER SE LECTING 7 COMPARABLE S WHOSE ARITHMETIC MEAN OF THE PROFIT LEVEL INDICATOR OF OPERATING PROFIT/TOTAL C OST WAS 16.45% AND THE ASSESSEES MARGIN WAS 13.92% . ACCORDINGLY, ASSESSEE SUBMITTED THAT IT IS INTERNATIONAL TRANSACTIONS ARE AT ARMS - LENGTH PRICE. WHIL E DERIVING THE MARGIN , THE ASSESSEE SEGREGATED THE OPERATING PROFIT BETWEEN THE TRANSACTION OF THE ASSOCIATED ENTERPRISE AND NON - ASSOCIATED ENTERPRISE. THE ASSESSEE SHOWED PLI OF 4.46% ON TRANSACTION WITH ASSOCIATED ENTERPRISE AND 1.15% WITH NON - ASSOCIATED ENTERPRISE. SIMILARLY IN ASSESSMENT YEAR 2007 - 08, THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS BEFORE THE LEARNED TRANSFER PRICING OFFICER ABANDONED ITS TRANSFER PRICING STUDY REPORT AND CAME WITH THE FRESH SET OF COMPARABLES. THE FRESH SET OF COMPARABLES THROWN BY THE ASSESSEE WERE 5 IN NUMBER WHERE THE AVERAGE PLI OF OPERATING PROFIT/ TOTAL COST WAS 3.52%. THE LEARNED TRANSFER PRICING OFFICER REJECTED THE TP STUDY OF THE ASSESSEE AND PASSED AN ORDER U/S 92CA (3) OF THE ACT ON 28/10/2011 PR OPOSING AN ADJUSTMENT ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 12 OF RS. 75266923/ . ASSESSEE USE D TRANSACTIONAL NET MARGIN METHOD TO JUSTIFY THE ARMS - LENGTH PRICE AND FILED SEGMENTAL INCOME DECLARING OPERATING PROFIT/OPERATING COST AT 4.46% IN THE CASE OF A TRANSACTION AND LOSS OF 1.15% IN CASE O F NON - AE TRANSACTION. THE TRANSFER PRICING OFFICER REJECTED THE SEGMENTAL RESULTS GIVEN BY THE ASSESSEE AND ALSO ALL THE COMPARABLES AND SELECTED HIS OWN 5 COMPARABLES AND DETERMINED THE AVERAGE PLI OF 36.09 % ADOPTING OPERATING PROFIT/OPERATING EXPENSES A S THE PROFIT LEVEL INDICATOR. ACCORDINGLY, ADJUSTMENT WAS PROPOSED. 14 . BOTH THE PARTIES AGREED BEFORE US THAT THE FACTS OF THE CASE ARE IDENTICAL TO THE FACTS OF THE CASE FOR ASSESSMENT YEAR 2007 - 08 , WHEREIN ON IDENTICAL FACTS THE LEARNED ASSESSING OFFICER HAS PREFERRED THIS APPEAL. 15 . WE HAVE ALSO CAREFULLY CONSIDERED THE ORDERS OF THE LOWER AUTHORITIES AND FIND THAT THE FACTS ARE IDENTICAL TO THE FACTS OF THE ASSESSMENT YEAR 2007 - 08. WE HAVE ALREADY DECIDED THE APPEAL OF THE AO AS PER THIS ORDER FOR ASSESSMEN T YEAR 2007 08, WHEREIN WE HAVE UPHELD THE ORDER OF THE LEARNED CIT (A) . FOR SIMILAR REASONS , WE ALSO UPHOLD ORDER OF THE LEARNED CIT A FOR ASSESSMENT YEAR 2008 09 AND DISMISS THE APPEAL OF THE LEARNED ASSESSING OFFICER. 16 . IN THE RESULT ITA NO. 583/ DEL /2014 FOR ASSESSMENT YEAR 2008 09 FILED BY THE LEARNED ASSESSING OFFICER IS DISMISSED. 17 . NOW WE COME TO THE APPEAL OF THE LEARNED ASSESSING OFFICER FOR ASSESSMENT YEAR 2009 10 IN ITA NO. 2316/ DEL /2015. THE LEARNED ASSESSING OFFICER HAS RAISED THE FOLLOW ING GROUNDS OF APPEAL: - 1. THE LD CIT(A) ERRED IN ACCEPTING THE ASSESSEES CONTENTION THAT INTERNAL CUP CAN BE USED WHEN MARGINS ARE BEING COMPARED. THE USE OF CUP THE COMPARISON OF ACTUAL AND NOT MARGINS. 2. THE LD CIT(A) ERRED IN HOLDING THAT SINCE NO ADJUSTMENT WAS MADE IN AES CASE, NO ADJUSTMENT CAN BE MADE IN THE ASSESSEE CASE. THIS IS IGNORANCE OF SECTION 92(3) OF THE IT ACT, 1961. 3. THE LD CIT(A) ERRED IN APPLYING THE DECISION OF INTERA TECHNOLOGIES, HUGEHS SYTIQUE AND LUMMNS TECHNOLOGY TO REJECT THE TPOS STAND OF REJECTING INTER TNMM. THESE DECISIONS ARE RELATED TO THE THRESHOLD OF RELATED PARTY TRANSACTION AND NOT TO THE USE OF INTERNAL TNMM. ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 13 4. THE LD CIT(A) ERRED IN REJECTING COMPARABLES USED BY THE TPO BASED ON THE EARLIER YEARS ORDER. THE FAR ANALYSIS HAS TO BE DONE SEPARATELY FOR EACH YEAR AND ONLY THEN CAN BE DECISION ON COMPARABILITY TO ARRIVED AT. 18 . FOR THIS YEAR THE ASSESSEE FILED ITS RETURN OF INCOME ON 30/9/2009 DECLARING INCOME OF RS. 9901133/ . THE ASSESSMENT U/S 143 (3) OF THE AC T WAS PASSED WHEREIN THE TOTAL ADDITION OF RS. 36332947/ WAS MADE. THE TOTAL INCOME WAS DETERMINED AT RS. 46234080/ . THE ADDITION ON ACCOUNT OF THE ARMS - LENGTH PRICE OF THE INTERNATIONAL TRANSACTION WAS RS. 3 0773768/ . THE ONLY DISPUTE IN THIS APPEAL IS THE ABOVE ADJUSTMENT MADE BY THE LEARNED TRANSFER PRICING OFFICER WHICH WAS DELETED BY THE LEARNED CIT A AND THEREFORE THE LEARNED AO IS IN APPEAL BEFORE US. 19 . BOTH THE PARTIES CONFIRMED THAT THE FACTS OF THE PRESENT CASE ARE IDENTICAL TO THE FACTS OF T HE CASE FOR ASSESSMENT YEAR 2007 08 . THE SUBMITTED THAT THEIR ARGUMENTS ALSO REMAINS THE SAME. 20 . WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE ORDERS OF LOWER AUTHORITIES. IT IS FOUND THAT THE ASSESSEE HAS ENTERED INTO AN INTERNATIONAL TRANSACTION OF PROVISION OF TECHNICAL SERVICES TO ITS ASSOCIATED ENTERPRISE AND THE ASSESSEE BENCHMARKED WITH THE COST PLUS METHODS AND SUBSTANTIATED IT WITH TRANSACTIONAL NET MARGIN METHOD. THE LEARNED TRANSFER PRICING OFFICER FOUND THAT TH E ASSESSEE HAS SHOWN THE MARGIN OF OPERATING PROFIT/OPERATING COST OF 10.36% IN ITS TRANSACTION WITH THE ASSOCIATED ENTERPRISE AND PROFIT OF 2.10% ON ITS TRANSACTIONS WITH NON - ASSOCIATED ENTERPRISES. THE LEARNED TRANSFER PRICING OFFICER ALSO REJECTED THE INTERNAL TRANSACTIONAL NET MARGIN METHOD EMPLOYED BY THE ASSESSEE IN HIS TP STUDY REPORT. ON CAREFUL PERUSAL OF THE ORDERS OF THE LOWER AUTHORITIES IT IS APPARENT THAT FACTS ARE IDENTICAL TO THE CASE INVOLVED IN THE APPEAL FOR ASSESSMENT YEAR 2007 08 FI LED BY THE LEARNED ASSESSING OFFICER. BY THIS ORDER WE HAVE ALREADY DISMISS ED APPEAL OF THE LEARNED ASSESSING OFFICER UPHOLDING THE ORDER OF THE LEARNED CIT (A) AND THEREFORE , FOR SIMILAR REASONS , WE ALSO DISMISS THE APPEAL OF THE LEARNED ASSESSING OFFICER FOR THIS YEAR ALSO. ACCORDINGLY ITA NO. 2316/ DEL /2015 ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 14 FILED BY THE ASSESSING OFFICER FOR ASSESSMENT YEAR 2009 - 10 IS ALSO DISMISSED. 21 . NOW WE COME TO THE APPEAL OF THE LEARNED ASSESSING OFFICER WHEREIN HE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL IN ITA NO . 6152 /DEL/ 2015 FOR THE ASSESSMENT YEAR 2010 - 11 : - 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD CIT(A) IS CORRECT IN ACCEPTING THE ASSESSEES CONTENTION THAT CUP CAN BE USED WHEN MARGINS ARE BEING COMPARED. THE USE OF CIP REQUIRE TH E COMPARISON OF ACTUAL PRICE AND NOT MARGINS. 2. WHETHER OP THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD CIT(A) IS CORRECT IN APPLYING THE DECISION OF INTERA TECHNOLOGIES, HUGHES SYSTIQUE AND LUMMNS TECHNOLOGY TO REJECT THE TPOS STAND OF REJECTI NG INTERNAL TNMM. THESE DECISIONS ARE RELATED TO THE THRESHOLD OF RELATED PARTY TRANSACTION AND NOT THE USE OF INTERNAL TNMM? 3. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT(A) IS CORRECT ON THE FACTS AND IN LAW IN NON ADJUCATING THE GROU NDS RAISED BY THE ASSESSEE ON THE ISSUE OF COMPARABLE. 22 . FACTS FOR THIS YEAR SHOW THAT THE ASSESSEE HAS FILED ITS RETURN OF INCOME ON 7/10/2010 DECLARING TOTAL INCOME OF RS. 56485470/ WHICH WAS REVISED ON 10/1/2012 AT RS. 77189930/ . THE ASSESSMENT U/S 143 (3) OF THE ACT WAS PASSED ON 18/3/2014 WHEREIN THE TOTAL INCOME OF THE ASSESSEE WAS DETERMINED AT RS. 134994381/ WHERE THE ADDITION OF RS. 57804451/ WAS MADE. THE ONLY ADDITION IN DISPUTE WAS THE DETERMINATION OF THE A RMS - LENGTH PRICE OF THE INTERNATIONAL TRANSACTION OF RS. 55072979/ . THE LEARNED CIT (A) , ON APPEAL BY THE ASSESSEE, DELETED THE ABOVE ADDITION FOLLOWING HIS OWN DECISIO N FOR ASSESSMENT YEAR 2009 10. THEREFORE, THE ASSESSING OFFICER IS IN APPEAL BEFORE US. 23 . BOTH THE PARTIES CONFIRMED THAT THE FACTS IN THE PRESENT APPEAL ARE IDENTICAL TO THE FACTS IN THE CASE OF THE ASSESSEE FOR EARLIER YEARS AND THEIR ARGUMENTS ALSO REMAINED THE SAME. 24 . WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTION AND PERUSED THE ORDER S OF THE LOWER AUTHORITIES. WE FIND THAT THE IDENTICAL ISSUE HAS BEEN DECIDED BY US IN CASE OF THE ASSESSEE FOR ASSESSMENT YEAR 2007 08 TO 2009 10 WHEREIN WE DISMISS ED THE APPEAL OF THE LEARNED ASSESSING OFFICER ACIT VS M/S. BCEOM (INDIA)P. LTD, ITA NO. 4710/DEL/2012 & 2316/DEL/2015 & 583/DEL/2014 & 6152/DEL/2015 (ASSESSMENT YEAR: 2007 - 08 TO 2010 - 11 PAGE | 15 FOLLOWING OUR DETAILED REASONS GIVEN IN APPEAL OF THE LEARNED AO FOR ASSESSMENT YEAR 2007 08. THEREFORE , FOR THE SIMILAR REASONS GIVEN BY US IN THE EARLIER YEARS, WE ALSO DISMISS THE APPEAL OF THE LEARNED ASSESSING OFFICER FOR THIS YEAR. ACCORDINGLY ALL THE 4 GROUNDS RAISED BY THE LEARNED AS SESSING OFFICER WITH RESPECT TO THE ADJUSTMENT OF THE ARMS - LENGTH PRICE OF THE INTERNATIONAL TRANSACTIONS ARE DISMISSED. 25 . IN THE RESULT APPEAL FILED BY THE LEARNED ASSESSING OFFICER FOR ASSESSMENT YEAR 2010 11 IN ITA NO. 6152/ DEL /2015 IS DISMISSED. 26 . ACCOR DINGLY ALL THE 4 APPEALS FILED BY THE LEARNED ASSESSING OFFICER IN CASE OF THIS ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 2 2 / 0 4 / 2019 . - SD/ - - SD/ - ( H.S.SIDHU ) (PRASHANT MAHARISHI JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 2 2 / 04 / 2019 COPY FORWARDED TO 1 . APPLICANT 2 . RESPONDENT 3 . CIT 4 . CIT (A) 5 . DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI