JCB India Ltd., New Delhi V. DCIT, CIRCLE- 13(2), New Delhi

ITA 519/DEL/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 0004 (ITAT-DELHI)
• Duration Of Justice: 8 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I1
• Assessment Year: 2015-2016
• Appeal Filed On: 16-05-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Keywords: Transfer pricing; Opportunity of being heard; Principle of natural justice; International transaction; Rule of consistency; Assessment record; Set aside
• Section: 263; 154; 2; 143(3); 92CA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘I-1’ NEW DELHI BEFORE SHRI G.S. PANNU, HON’BLE PRESIDENT AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA No.518/Del/2021 Assessment Year: 2014-15 And ITA No.519/Del/2021 Assessment Year: 2015-16 M/s. JCB India Ltd., B1/1-1, 2 nd Floor, Mohan Cooperative Industrial Estate, Mathura Road, New Delhi Vs. DCIT, Circle-13(2), New Delhi PAN :AAACE0078P (Appellant) (Respondent) ORDER PER SAKTIJIT DEY, JM: By filing these appeals, assessee has called into question the validity of the orders passed under section 263 of the Income-Tax Appellant by Sh. Vishal Kalra, Advocate Sh. S.S. Tomar, Advocate Sh. Ankit Sahani, Advocate Respondent by Sh. Surender Pal, CIT(DR) Date of hearing 21.12.2021 Date of pronouncement 19.01.2022 2 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) Act, 1961 (for short ‘the Act’) for the assessment years 2014-15 and 2015-16. 2. Grounds raised by the assessee in both the appeals are identical and read as under: “1. That on the facts and circumstances of the case and in law, the assumption of jurisdiction by the PCIT under section 263 of the Act, based on conjectures and surmises and without recording an objective finding or a conclusive evidence as to how the assessment order passed by the Assessing Officer ("AO”) under section 143(3) of the Act is erroneous and prejudicial to the interests of Revenue, was bad in law and liable to be quashed. 2. That on the facts and circumstances of the case and in law, the PCIT has erred in invoking jurisdiction under section 263 of the Act and setting aside the order passed by the AO without appreciating that the assessment order passed was neither erroneous nor prejudicial to the interest of the revenue. 3. That on the facts and circumstances of the case and in law, the revisionary jurisdiction assumed by the PCIT under section 263 of the Act is also bad in law and liable to be quashed for the reason that the order of the AO cannot be held to be erroneous and prejudicial to the interest of the revenue, especially, for the reason that as per section 92CA(4) of the Act, the AO has no other option but to pass the assessment order in conformity with the ALP determined by the TPO. 3.1 That on the facts and circumstances of the case and in law, the PCIT has erred in exceeding his jurisdiction by initiating the revisionary proceedings under section 263 of the Act without appreciating that PCIT has no jurisdiction over the TPO administratively, and initiation of such revisionary proceedings is bad in law and liable to be quashed. 4. That on the facts and circumstances of the case and in law, the PCIT has failed to appreciate that jurisdiction under section 263 of the Act, cannot be invoked for launching fishing and roving inquiries as in the case of the Appellant without recording any objective finding that the Royalty paid on models other than 3DX was excessive or were not arm’s length price. 4.1 That on facts and circumstances of the case and in law, the PCIT has erred in initiating the proceedings under section 263 of the 3 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) Act based on mere change of opinion, and by substituting his own views against plausible views of the AO/TPO. 4.2 That on the facts and circumstances of the case and in law, the PCIT has erred in merely setting aside the final assessment order for fresh examination of the royalty payments made by the Appellant for models other than 3DX, without acknowledging that the same were already examined by the AO/TPO while passing respective orders in the original proceedings. 5. That on the facts and circumstances of the case and in law, the PCIT has erred in passing the order in haste and without providing an adequate opportunity of being heard to the Appellant, which is not in accordance with law and is in violation of the principles of natural justice.” 3. Since, the facts involved in both these appeals are common, except, variance in figures and the show cause notices issued under Section 263 of the Act as well as the orders passed under the said provision are identically worded, as a matter of convenience, we propose to discuss the fact as involved in assessment year 2014-15. 4. Briefly the facts are, the assessee is a resident company incorporated on 1 st February, 1979 and is engaged in the business of manufacturing and trading of earth moving equipments and trading of its spare parts and components as well as providing services. For the assessment year 2014-15, the assessee filed its return of income on 28.11.2014 declaring total income of Rs.592,85,26,809/- under normal provisions and book 4 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) profit of Rs.581,19,14,165/-. In course of assessment proceeding, the Assessing Officer having noticed that in the year under consideration, the assessee had entered into international transactions with JCB Group, its overseas Associated Enterprise (AE), made a reference under Section 92CA(1) of the Act to the Transfer Pricing Officer (TPO) for determining the Arm’s Length Price (ALP) of the international transactions. After examining the transfer pricing study report furnishing by the assessee and other materials/details, the TPO accepted all international transactions, except, the transaction relating to payment of royalty to the AE on certain patented products. The TPO found that the assessee had paid royalty to the AE on certain patented products manufactured by the AE at the rate of 5%. He further noticed that for benchmarking the ALP of the royalty payment, the assessee had adopted Comparable Uncontrolled Price (CUP) method as the most appropriate method and after economic analysis having found the royalty paid in similarly placed comparable transactions works out to average rate of 6.37% claimed the payment of royalty to the AE to be at arm’s length. 5. The TPO accepted the payment of royalty to the AE at 5% in respect of all earth moving equipments, except, 3DX model. As far 5 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) as the 3DX model is concerned, the TPO observed that the assessee was unable to furnish any documentary evidence to indicate that the patent of the product is with the AE. He observed, the information available on record indicates that the product was developed in India with assessee’s own research and development. Further, he observed that in assessee’s own case in assessment year 2013-14, the Dispute Resolution Panel (DRP) has determined the ALP of royalty on 3DX model at 2%. Thus, ultimately, the TPO held that the arm’s length rate of royalty on 3DX model is to be determined at 2% as against 5% claimed by the assessee. Accordingly, applying the royalty rate of 2% he suggested an upward adjustment of Rs.91,85,00,341/- on substantive basis. Further, the TPO also provided an alternative benchmarking by determining the ALP of royalty on the 3DX Model at nil and suggested an adjustment of Rs.153,08,33,902/- on protective basis. While framing the draft assessment order, the Assessing Officer added back the adjustment suggested by the TPO on substantive basis. While considering assessee’s objections on the issue, learned DRP upheld the decision of the TPO. However, while deciding assessee’s appeal on the issue, the Tribunal restored the matter back to the Assessing Officer with a 6 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) direction to apply the rate of royalty as finalized under MAP proceeding. 6. Be that as it may, when the matter stood thus, learned Principal Commissioner of Income Tax (for short ‘PCIT’) called for and examined the assessment records of the assessee. On examining the assessment records, he was of the view that the TPO, though, had determined the ALP of royalty to the AE at 2% in respect of 3DX model, however, he has not suggested any adjustment on other models, like 2DX, excavators, JCB Earth Movers, JCB Heavy Wheel loader etc. Since, neither the TPO, nor the Assessing Officer had made any inquiry in respect of various models of earth moving equipments, except 3DX model, he was of the view that the orders passed by the TPO and the Assessing Officer are erroneous and prejudicial to the interest of Revenue. Accordingly, he issued a show-cause notice under Section 263 of the Act requiring the assessee to explain, as to why the assessment order, being erroneous and prejudicial to the interest of revenue, should not be revised. Alleging that the assessee did not furnish any reply to the show-cause notice by the stipulated date, i.e., 08.03.2021, learned PCIT passed the impugned order under Section 263 of the Act setting aside the assessment order 7 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) with a direction to examine the requirement of adjustment to be made to the ALP of royalty for models other than 3DX model. The specific observations of learned PCIT while setting aside the assessment order are as under: “3. As mentioned in the show cause notice the upward adjustment of royalty was done only in respect of 3DX model, while the issue of similar adjustment for other models was neither examined nor any such adjustment was made. This issue should have been examined by the TPO and AO and failure to examine the same and conduct necessary enquiry makes the assessment order passed erroneous and prejudicial to the interest of revenue. 4. Consequently, it is set aside and the issue is restored to the file of TPO/AO for examination of the adjustment of Arm’s Length Price in respect of Royalty for models other than 3DX in accordance with law after giving the assessee an opportunity of hearing.” 7. Learned counsel for the assessee submitted, the order passed under Section 263 of the Act is invalid in the eye of law as learned PCIT has wrongly assumed jurisdiction under Section 263 of the Act to revise the order passed by learned TPO and the assessment order passed in pursuance thereof. He submitted, section 263 of the Act does not confer any administrative jurisdiction over the TPO. Therefore, he could not have revised the order of the TPO. Proceeding further, he submitted, once reference is made to the TPO to determine the arm’s length price 8 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) of a particular international transaction, in terms with section 92CA(4), the Assessing Officer is duty-bound to compute the total income of the assessee in conformity with ALP determined by the TPO. Thus, once TPO has passed an order under Section 92CA of the Act, the Assessing Officer has to complete the assessment by incorporating the adjustment, if any, to the ALP suggested by the TPO. The Assessing Officer cannot independently proceed to determine the ALP of a particular transaction. He submitted, the Assessing Officer having followed the statutory mandate in the present case, the assessment order cannot be considered to be erroneous and prejudicial to the interest of Revenue. In support of such contention, learned counsel relied upon the following decision: 1. Essar Steel Ltd. Vs. Additional Commissioner of Income Tax, (2012) 28 taxmann.com 232 (Mum.) 2. Tata Communications Ltd. Vs. DCIT, [2014] 41 taxmann.com 486 (Mum. –Trib) 8. Without prejudice, learned counsel submitted, in course of proceedings before the TPO as well as the Assessing Officer, the assessee has furnished all details regarding the payment of royalty in respect of all models of earth moving equipments, including 3DX model. To substantiate this fact, learned counsel 9 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) drew our attention to various submissions made before the TPO and Assessing Officer from time to time. He submitted, in earlier as well as subsequent assessment years, though, the assessee had paid royalty on all models, including 3DX model, however, payment of royalty at 5% has never been disputed by the Revenue, except in case of 3DX model. He submitted, the major part of the royalty paid to AE is in respect of 3DX model. Therefore, except payment of royalty in respect of 3DX model, payment of royalty in respect of other models have always been accepted by the department. He submitted, for this reason only, the assessee and revenue approached for resolution of the dispute regarding payment of royalty on 3DX model under MAP. He submitted, though, in assessment year 2010-11, the TPO had proposed adjustment towards payment of royalty on all models, however, subsequently, upon considering the application filed by the assessee under section 154 of the Act, the TPO restricted the adjustment on account of royalty payment only to 3DX model. Thus, he submitted, when payment of royalty on other products have been consistently accepted by the revenue over the years to be at arm’s length, the TPO cannot be faulted in following the rule of consistency and proposing adjustment only in respect of 3DX 10 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) model. Thus, he submitted, the assessment order cannot be considered erroneous and prejudicial to the interest of revenue. Drawing our attention to the order passed under Section 263 of the Act, learned counsel submitted, except for a general observation made that the TPO has not inquired into the royalty payment of other models, the PCIT has not even whispered a single word as to for which other model, the payment or royalty is not at arm’s length. Thus, he submitted, merely for initiating a roving and fishing inquiry, learned PCIT cannot exercise jurisdiction under Section 263 of the Act. 9. Learned Departmental Representative submitted, the facts on record clearly reveal that the TPO has not at all examined the arm’s length nature of royalty paid to AE in respect of other models, except 3DX model. Thus, there is complete non-inquiry and non-application of mind by the TPO. He submitted, the adjustment proposed by the TPO has been incorporated by the Assessing Officer in the final assessment order without any change. He submitted, during the year under consideration, the assessee has paid total royalty of Rs.185.47 crores, out of which, approximately 32 crores represent royalty paid on other models. Thus, he submitted, a significant amount of royalty payment has 11 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) been left out by the TPO while determining the ALP of the royalty paid to the AE. Thus, he submitted, learned PCIT has correctly assumed jurisdiction under Section 263 of the Act, as, due to non-inquiry and non-examination of the entire royalty payment, the order of the TPO as well as the assessment order are erroneous and prejudicial to the interest of the Revenue. He submitted, Explanation 2 to section 263 of the Act empowers the PCIT to exercise jurisdiction under section 263 of the Act, if in his opinion, the Assessing Officer has not conducted the necessary inquiry which was required to be done. He submitted, in any case of the matter, the PCIT has not given any specific direction to the Assessing Officer/TPO to make any adjustment to the royalty payment made for other model. He has simply directed the Assessing Officer/TPO to make necessary inquiry regarding the royalty paid on other models. Hence, no prejudice is caused to the assessee. In support of his contention, he relied upon the following decision: 1. M/s. Vama Sundari Investment (Delhi)(P) Ltd. Vs. Pr. CIT, ITA No. 2252/Del/2018, dated 29.11.2018 2. Mohd. Momineen Qureshi Vs. ACIT, ITA No.1987/Del/2018, dated 02.04.2019. 3. Shri Sai City Promoters and Developers Pvt. Ltd & Another Vs. Pr. CIT, ITA No. 6905/Del/2017 & Ors., dated 14.01.2019. 12 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) 10. Without prejudice to the aforesaid submissions, drawing our attention to Ground no. 5, learned Departmental Representative submitted, if the assessee is aggrieved with lack of adequate opportunity of being heard granted by learned PCIT, the matter can be restored back to him for de novo adjudication after providing opportunity of being heard to the assessee. 11. We have considered rival submissions in the light of the decisions relied upon and perused the materials on record. At the outset, we propose to address the preliminary issue raised by the assessee assailing the assumption of jurisdiction under section 263 of the Act to revise the assessment order. Undisputedly, in the previous year relevant to the assessment order under dispute, the assessee had entered into various international transactions with its overseas AEs. In course of assessment proceeding, the Assessing Officer having noticed the aforesaid fact, considered it appropriate that ALP of the international transaction with the AEs has to be determined by the TPO. Accordingly, complying with the provision contained in Section 92CA(1) of the Act, the Assessing Officer obtained an approval from the PCIT and made a reference to the TPO to determine the ALP of various international transaction with the AE. Once the reference was made by the 13 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) Assessing Officer as aforesaid, the TPO proceeded to determine the ALP of the international transactions with the AEs. After following the procedure laid down in sub-section (2), the TPO passed an order under section 92CA(3) of the Act determining the ALP of the international transactions with AE. While doing so, the TPO made an adjustment to the ALP of the royalty paid to the AE on 3DX model by reducing the rate of royalty from 5% to 2%. In pursuance to the order passed by the TPO under Section 92CA(3) of the Act, the Assessing Officer framed the draft assessment order incorporating the adjustment made by the TPO. Against the draft assessment order, the assessee filed objections before learned DRP and in terms with the direction issued by learned DRP, the Assessing Officer passed the final assessment order. 12. Undisputedly, the final assessment order dated 29.11.2018 is the subject matter of proceeding under section 263 of the Act. The issue which arises for consideration is, whether learned PCIT has jurisdiction to revise an assessment order passed in pursuance to the order of TPO, by holding it to be erroneous and prejudicial to the interest of Revenue. A reading of the provisions contained under Section 92CA as a whole and more particularly, sub-sections (1), (3) and (4), it would become very much clear that 14 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) once a reference is made by Assessing Officer to the TPO to determine the ALP of a particular international transaction and the TPO determines the ALP under sub-section (3), the Assessing Officer, in terms with sub-section (4), must proceed to compute the total income of the assessee in conformity with the ALP determined by the TPO. The use of word “shall” in sub-section 4 of section 92CA makes it amply clear, once a reference is made to the TPO under Section 92CA(1) of the Act it is mandatory on the part of the Assessing Officer to compute the total income of the assessee in conformity with the adjustment, if any, to the ALP proposed by the TPO. 13. In the facts of the present appeal, undisputedly, in the order passed under section 92CA(3) of the Act, the TPO had proposed adjustment only in respect of royalty paid to the AE on 3DX model. In terms with sub-section (4) of section 92CA of the Act, the Assessing Officer has computed total income of the assessee in conformity with the order passed by the TPO. Thus, the Assessing officer has not committed any error in completing the assessment, as, he has fully complied with the statutory provisions. Reading of the show-cause notice issued under Section 263 of the Act as well as the order passed under the said 15 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) provision would make it clear that learned PCIT has considered the assessment order to be erroneous and prejudicial to the interest of revenue, since, the TPO has not examined the arm’s length nature of royalty paid to the AE in respect of other models of earth moving equipment. 14. Thus, the show-cause notice issued under Section 263 of the Act and the order passed there under would leave no room for doubt that the shortcoming, according to the PCIT, is in the order passed by the TPO under section 92CA(3) of the Act due to non- inquiry/non-examination of certain transaction. However, section 263(1) empowers the Revisionary Authority to revise any order passed by the Assessing Officer, if in his opinion, such order is erroneous and prejudicial to the interest of Revenue. Thus, due to restriction imposed under section 263(1) of the Act, learned PCIT has no administrative power to revise the order passed by the TPO under section 92CA(3) of the Act. Therefore, the question arising for consideration is, when the PCIT has no power to revise the order passed by the TPO under section 92CA(3) of the Act, can he revise the assessment order which has been passed in conformity with the order of the TPO, as mandated under Section 92CA(4) of the Act? Our answer to the question is in the negative. 16 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) 15. When the provision contained under Section 92CA(4) of the Act makes it mandatory upon the Assessing Officer to compute the total income of the assessee in conformity with the order of the TPO and the Assessing Officer has computed the total income following the statutory mandate, the assessment order cannot be considered to be erroneous. Even, assuming that some prejudice might have been caused to the Revenue, nevertheless the twin conditions of ‘erroneous’ and ‘prejudicial’ to the interest of the revenue as provided under section 263(1) of the Act have to be fulfilled to enable the Revisionary Authority to assume jurisdiction under the said provision. Thus, once learned PCIT has no administrative power under Section 263(1) of the Act to revise the order of the TPO, he cannot revise the assessment order passed thereafter in compliance to the provision contained under Section 92CA(4) of the Act. This view of ours is well supported by the decisions of the Tribunal in the case of Essar Steel Limited Vs. Addl. CIT (supra) and TATA Communication Ltd. Vs. DCIT (supra). Thus, in our considered opinion, learned PCIT had no jurisdiction to revise the impugned assessment order dated 29.11.2018 under section 263 of the Act. 17 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) 16. Having held so, now it is necessary to examine whether the assessment order can, at all, be held to be erroneous and prejudicial to the interest of revenue for non-examination of royalty payment on other models of earth moving equipment. From the show-cause notice issued under Section 263 of the Act, it is very much clear that the grievance of the Revisionary Authority is that TPO has reduced the rate of royalty paid to the AE from 5% to 2 % only in respect of 3DX model of earth moving equipment while leaving out the other models of earth moving equipment. While doing so, he has also referred to the MAP resolution filed in course of proceeding for assessment year 2017- 18, wherein, relief was granted to the assessee only on 3DX model by allowing royalty of 4% and 3% for assessment years 2014-15 and 2015-16 respectively. It is the allegation of learned PCIT that the TPO has not at all inquired into the arm’s length nature of royalty paid in respect of other models. 17. On perusal of materials on record, it is observed, in course of proceeding before the TPO, various details relating to royalty payment were called for and examined. The assessee has furnished all the details relating to payment of royalty on all models of earth moving equipment. It is a fact on record that the 18 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) assessee has paid royalty at the rate of 5% on all the models. While examining arm’s length nature of royalty payment, the TPO having found that the patent for the 3DX model was not owned by the AE but was developed in India, was of the view that payment of royalty at 5% is not at arm’s length. Accordingly, relying upon the orders passed in the preceding assessment years, wherein, adjustment in respect of royalty payment was made only in respect of 3DX model, the TPO proceeded to determine the ALP of the royalty paid only in respect of 3DX model. Thus, the materials on record clearly reveal that the royalty paid at 5% on other models, except 3DX model, was always accepted by the department to be at arm’s length and was never a subject matter of dispute between the assessee and the revenue. 18. In fact, when the TPO proposed adjustment to the rate of royalty paid on other models in assessment year 2010-11, the assessee moved an application for rectification under Section 154 of the Act. While considering such application, the TPO rectified the order passed by him by making adjustment only in respect of royalty paid on 3DX model and deleted the adjustment made for other models. This fact is very much evident from the rectification order dated 18.03.2014 passed for the assessment year 2010-11, 19 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) a copy of which is placed at page 97 of the paper-book. In fact, in the MAP proceeding also, the dispute between the assessee and the Revenue was only in respect of payment of royalty on 3DX model. Thus, considering the fact that payment of royalty on other models has all along been accepted by the department to be at arm’s length, no fault can be found with the order passed by the TPO making adjustment only in respect of 3DX model, as, he has adheared to the rule of consistency. In any case of the matter, when the payment of royalty at the same rate on other models was found to be at arm’s length in all the preceding assessment years, there is no reason for the TPO in not considering such payment made in the impugned assessment year to be at arm’s length in absence of any factual difference. 19. Thus, insofar as, the allegation of learned PCIT that the TPO has not at all inquired into and examined the arm’s length of the nature of royalty paid on other models, we are unable to agree with the same. Facts on record clearly reveal that every details relating to the royalty paid on all models, including 3DX model was furnished before the TPO and were examined by him. The reason for him to accept the royalty paid on other models is, similar payments were accepted consistently in the preceding 20 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) assessment years. Therefore, the view of the TPO in accepting the royalty paid in respect of other models is a possible view considering the past history of such payment. That being the case, the orders passed by the TPO and thereafter by the Assessing Officer in conformity thereof, cannot be considered to be erroneous and prejudicial to the interest of the Revenue. In any case of the matter, neither in the show-cause notice, nor in the order passed under Section 263 of the Act, learned PCIT has provided any valid reason to demonstrate the prejudice caused to the Revenue. He has not pointed out even a single reason how the royalty paid on other models is not at arm’s length, except, saying that the TPO has not inquired into and examined the royalty paid on other models. 20. In course of hearing, learned Departmental Representative has submitted that royalty paid on other models is also substantial, as, it amounts to Rs.32 crores. Therefore, the TPO should have examined the arm’s length nature of royalty paid on other models. In view of our detailed discussions above, we do not think that the aforesaid argument of learned Departmental Representative would hold much water to justify the exercise of power under Section 263 of the Act. What we have to examine is, 21 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) whether the twin conditions of section 263(1) are fulfilled. Having examined the facts of the present case, we are convinced that the conditions of section 263(1) are not fulfilled. Therefore, as a natural corollary, the impugned order passed under Section 263 of the Act has to be declared as invalid and quashed. Accordingly, we do so. Resultantly, assessment order is restored. Before parting, we must observe that having carefully examined the decisions cited before us by learned Departmental Representative, we are of the view that such decisions have been rendered in their own set of fact, hence would not be applicable to the facts of the present case. In view of our decision above, we do not intend to deal with ground no. 5, as, for all intent and purpose, it has been rendered infructuous. 21. In the result, the appeal is allowed. ITA No.519/Del/2021 Assessment Year: 2015-16 22. Facts and the issues raised in this appeal being materially identical, our decision in ITA No. 518/Del/2021, would apply mutatis mutandis to this appeal as well. Accordingly, the order 22 ITA No. 518 & 519/Del/2021 (JCB India Ltd.) passed under section 263 of the Act is set aside and the assessment order is restored. 23. To sum up, both the appeals are allowed in the terms indicated above. Order pronounced in the open court on 19 th January, 2022 Sd/- Sd/- (G.S. PANNU) (SAKTIJIT DEY) PRESIDENT JUDICIAL MEMBER Dated: 19 th January, 2022. RK/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi