DCIT, New Delhi V. M/s. Vertex Customer Services India (P) Limited, New Delhi

ITA 5228/DEL/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 3537 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 1 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2017
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: I
• Assessment Year: 2005-2006
• Appeal Filed On: 24-09-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Transfer pricing; Opportunity of being heard; International transaction; Rule of consistency; Avoidance of tax
• Section: 80G

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : I - 2 NEW DELHI BEFORE SH. H.S. SIDHU , JUDICIAL M EMBER AND SH. O.P. KANT , ACCOUNTANT MEMBER ITA NO. 5228 /DEL/ 2014 ASSESSMENT YEAR: 2005 - 06 DCIT, CIRCLE - 17(1), NEW DELHI VS. M/S. VERTEX CUSTOMER SERVICES INDIA (P) LIMITED, GESCO CORPORATE CENTRE, THE GREA EASTERN CENTRE, 70, NEHRU PLACE, NEW DELHI PAN : AAGCS0438M (APPELLANT) (RESPONDENT) APPELLANT BY NONE RESPONDENT BY SH. H.K. CHOUDHARY, CIT(DR) & SH. SANJAY KUMAR YADAV, SR.DR DATE OF HEARING 17.10.2017 DATE OF PRONOUNCEMENT 06.11.2017 ORDER PER O.P. KANT , A. M. : THI S APPEAL HAS BEEN FILED BY THE R EVENUE AGAINST THE ORDER DATED 21/07/2014 OF THE COMMISSIONER OF INCOME - TAX (APPEALS) - XXIX, NEW DELHI [IN SHORT THE CIT - (A) ] FOR ASSESSMENT YEAR 2005 - 06 RAISING FOLLOWING GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. CIT(A) ERRED IN DIRECTING THE TPO TO DELETE ULTRAMINE AND PIGMENTS LTD. FROM THE FINAL SET OF COMPARABLES WHEREAS WHETHER THE MARGIN IS HIGH OR LOW IS NOT THE INDICATOR OF COMPARABILITY AND THE COMPARABLE WAS SELECTED BY THE TAXPAYER ITSELF AFTER FUNCTION, ASSETS AND RISK (FAR) ANALYSIS AND AGREED BY THE TPO' 2 ITA NO. 5228/DEL/2014 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. C1T(A) ERRED IN DIRECTING TO CONSIDER THE ADDITIONAL REMUNERATION OF RS. 10,26,67,942/ - IN FINANCIAL YEAR 2006 - 07 WHICH PERTAINS TO F.Y. 2004 - 05.' 3. THE APPELLANT CRAVES, LEAVE OR RESERVING THE RIGHT TO AMEND MODIFY, ALTER, ADD OR FOREGO ANY GROUND(S) OF APPEAL AT ANY T IME BEFORE OR DUR ING THE HEARING OF THIS APPEAL. 2. A T THE OUTSET, WE WOULD LIKE TO MENTION THAT THE ASSESSEE WAS ISSUED NOTICE FOR HEARING ON 17/10/201 7 AND WHICH WAS SERVED THROUGH D EPARTMENTAL R EPRESENTATIVE, HOWEVER , ON THE DATE OF HEARING NEITHER THE ASSESSEE APPEARED NOR ANY AUTHORIZED REPRESEN TATIVE OF THE ASSESSEE ATTENDED . NO WRITTEN SUBMISSION WAS EITHER FILED BY THE ASSESSEE . WE ALSO NOTE FROM THE RECORD THAT ON EARLIER OCCASIONS NOTICE FOR HEARING WAS SENT THR OUGH REGISTERED P ORTS AS WELL AS SERVED THROUGH DEPARTMENTAL R EPRESENTATIVE BUT NO COMPLIANCE WAS MADE ON BEHALF OF THE ASSESSEE. IT IS EVIDENT THAT THE ASSESSEE IS NOT INTER ESTED IN PROSECUTING THE APPEAL . WE ARE OF THE OPINION THAT SENDING AGAIN ONE MORE NOTICE TO THE ASSESSEE WOULD NOT SERVE ANY PURPOSE, AND ACCORDINGLY THE APPEAL WAS HEARD EX PARTE QUA THE ASSESSEE. 3. FACTS IN BRIEF OF THE CASE ARE THAT THE ASSESSEE COMPANY WAS INCORPORATED UNDER INDIAN C OMPANIES ACT, 1956 AS A WHOLLY - OWNED SUBSIDIARY OF VERTEX INDIA LTD UK , WHICH IN TURN WAS HELD JOINTLY BY VERTEX DATA SCIENCE L IMITED, UK AND GE EQUITY I NVESTMENT LTD , CAYMAN ISLANDS. THE ASSESSEE WAS ENGAGED IN PROVIDING SERVICES IN THE FIELD OF CUSTOMER RELATIONSHIP MANAGEMENT, MANAGING CALL CEN TRE AND INFORMATION TECHNOLOGY (IT) ENABLED SERVICES TO ITS ASSOCIATED ENTERPRISES (AES). THE ASSESSEE HAS PROVIDED THE SERVICES FROM ITS UNDERTAKING REGISTERED WITH SOFTWARE TECHNOLOGY PARKS OF INDIA (STPI). THE ASSESSEE FILED RETURN OF INCOME FOR THE YE AR UNDER CONSIDERATION ON 29/10/2005 DECLARING TOTAL INCOME OF RS.93,21,290/ - . THE CASE WAS SELECTED FOR SCRUTINY AND NOTICE UNDER SECTION 143(2) OF THE INCOME - TAX 3 ITA NO. 5228/DEL/2014 ACT, 1961 (IN SHORT THE ACT ) WAS ISSUED AND COMPLIED WITH. DURING ASSESSMENT PROCEEDING, THE ASSESSEE FILED A REVISED COMPUTATION OF INCOME , DECLARING TOTAL INCOME OF RS.1,02,56,880/ - . IN THE REVISED COMPUTATION, THE ASSESSEE DECLARED INCOME UNDER THE HEAD PROFIT AND GAINS OF BUSINESS OR PROFESSION AT NIL AFTER CLAIMING DEDUCTION OF RS.13,76 ,14,091/ - UNDER SECTION 10A OF THE ACT. INCOME UNDER THE HEAD INCOME FROM OTH ER SOURCES WAS DECLARED AT RS. 1,03,88, 88 0/ - AND AFTER CLAIMING DEDUCTION UNDER SECTION 80G OF THE ACT , AMOUNTING TO RS.1,32,000/ - TOTAL TA XABLE INCOME WAS ARRIVED AT RS.1, 02,56, 880/ - . IN ASSESSMENT PROCEEDING , THE ASSESSING OFFICER NOTICED FOLLOWING INTERNATIONAL TRANSACTIONS WITH ITS AES: S. NO. DESCRIPTION OF THE TRANSACTIONS AMOUNT (RS.) 1. PRO VISION OF IT ENABLED BACK SERVICES TO THE AES 946,818,348 2. RECEIPT OF CALL CENTRE SUPPORT SERVICES 102,575,273 3. RECEIPT OF TECHNICAL COUNSELTANCY SERVICES 18,815,642 4. COST RECHARGES 21,084,439 3.1 T HE ASSESSING OFFICER MADE A REFERENCE TO THE LD. TRANSFER PRICING OFFICER (TPO) FOR DETERMINATION OF ARM S LENGTH PRICE OF THE INTERNATIONAL TRANSACTIONS. 3.2 IN ITS TRANSFER PRICING REPORT, THE ASSESSEE CHARACTERIZED ITSELF AS IT ENABLED BACK - OFFICE SERVICE PROVIDER. FOR COMPUTING ARM S LENGTH PRICE OF THE INTERNATIONAL TRANSACTIONS, THE ASSESSEE SELECTED TRANSACTIONAL NET MARGIN METHOD ( TNMM ) AND AGGREGATED ALL TRANSACTIONS AND APPLIED TNM M AT ENTITY LEVEL. FURTHER, IT APPLIED APPLYING THE OPERATIN G PROFIT/TOTAL COST ( OP/TC ) AS THE PROFIT LEVEL INDICATOR ( PLI ). THE ASSESSEE SELECTED SET OF 22 COMPARABLES COMPANIES AND BASED ON AVERAGE OF THREE YEARS DATA I.E. FINANCIAL YEAR S 2002 - 03, 2003 - 04 AND 2004 - 05 OF THESE 22 SELECTED COMPARABLE COMPANIES, THE AVERAGE OP/TC MARGIN 4 ITA NO. 5228/DEL/2014 WAS DETERMINED AT 11.60%. FURTHER, IN VIEW OF THE CLAIM OF CAPACITY UTILIZATION ADJUSTMENT, THE ASSESSEE COMPUTED ITS OP/TC AT 13.80%. FURTHER , THE ASSESSEE MENTIONED THAT IT RE - NEGOTIATED ITS COMMERCIAL ARRANGEMENT WITH ITS AE , W HO AGREED FOR AN INCREASE IN THE SERVICE FEE FOR THE SERVICES RENDERED BY THE COMPANY IN THE YEAR UNDER CONSIDERATION AND , THEREFORE , AS A RESULT OF NEGOTIATION, THE ASSESSEE IN FINANCIAL YEAR 2006 - 07 RECEIVED AN ADDITIONAL AMOUNT O F RS.10,26,67, 942 / - FOR THE SERVICES RENDERED CORRESPONDING TO FINANCIAL YEAR 2004 - 05 I.E. THE YEAR UNDER CONSIDERATION. THE ASSESSEE RECOMPUTED OP/TC RATIO AT 26.2% AFTER TAKING INTO CONSIDERATION ADDITIONAL REMUNERATION FEE RECEIVED PERTAINING TO THE PERIOD UNDER CONSIDERATION AND ALSO AFTER MAKING ADJUSTMENT FOR EXCESS CAPACITY. IT WAS MENTIONED BY THE ASSESSEE THAT THIS PROFIT MARGIN BEING MORE THAN ARM S LENGTH MARGIN OF 11.06% EARNED BY THE COMPARABLES, THE INTERNATIONAL TRANSACTIONS WITH ITS AES WERE AT ARM S LENGTH. 3.3 TH E LD. TPO REJECTED THE CLAIM OF ADJUSTMENT FOR NOT UTILIZATION OF EXCESS CAPACITY AND CLAIM OF WORKING CAPITAL ADJUSTMENT. THE LD. TPO ALSO EXCLUDED THE ADDIT IONAL SERVICE FEE AMOUNT OF RS.10,26,67, 942/ - RECEIVED BY THE ASSESSEE IN FINANCIAL YEAR 2006 - 07 FO R THE SERV ICES RENDERED IN FINANCIAL YEAR 2004 - 05. THE LD. TPO USE D THE DATA OF CURRENT YEAR ONLY AS AGAINST MULTIPLE YEAR DATA USED BY THE ASSESSEE. THE TPO RECOMPUTED THE ARM S LENGTH PRICE AFTER SELECTING COMPARABLE FROM THE SET OF COMPARABLES USED IN TRANSFER PRICING STUDY BY THE ASSESSEE FOR IMMEDIATELY PRECEDING YEA RS AS WELL AS FROM THE SET OF COMPARABLE SELECTED BY THE ASSESSEE IN TRANSFER PRICING STUDY FOR THE YEAR UNDER CONSIDERATION. USING THIS METHODOLOGY , THE LEARNED TPO ARRIVED AT AN AVERAGE OP/TC MARGIN AT 14.77% FOR THE REVISED SET OF COMPARABLES AND PROCEE DED TO MAKE TP ADJUSTMENT AMOUNTING TO RS.5,60, 42,063/ - . 5 ITA NO. 5228/DEL/2014 3.4 AFTER FOLLOWING THE PROCEDURE LAID DOWN IN THE ACT, THE ASSESSING OFFICER PASSED THE FINAL ASSESSMENT ORDER ON 19/12/2008 AS SESSING THE TOTAL INCOME AT RS.6,62,98, 943/ - . 3.5 AGGRIEVED , THE ASSESS EE FILED APPEAL BEFORE THE LD. CIT - (A) , WHO PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. AGGRIEVED , THE R EVENUE IS IN APPEAL BEFORE THE TRIBUNAL RAISING THE GROUNDS AS REPRODUCED ABOVE. 4. THE GROUND NO. 1 RELATES TO THE DIRECTION OF THE LEARNED CIT - (A) FOR EXCLUDING M/S ULTRAMINE AND PIGMENTS LTD. FROM THE FINAL SET OF COMPARABLES. 4.1 BEFORE THE LEARNED CIT - (A) , THE ASSESSEE SUBMITTED THAT THIS COMPANY HAD EXTREME VOLATILITY/ VARIATIONS IN ITS BUS INESS PERFORMANCE. THE ASSESSEE SUBMITTED PROFIT ANALYSIS OF THE FOUR YEARS OF COMPARABLE AS UNDER: YEAR FY 2005 - 06 FY 2004 - 05 FY 2003 - 04 FY 2002 - 03 SEGMENTAL PROFITABILITY MARGINS 86.94% 155.79% 69.91% 16.78% 4.2 T HE FINDING OF LD. CIT - (A) DIRECTING EXCLUSION OF THE ULTRAMINE & PIGMENTS LTD. IS EXTRACTED AS UNDER: THE CONTENTION RAISED BY THE APPELLANT HAS BEEN DULY CONSIDERED. VARIOUS JUDICIAL DECISIONS HAVE HELD THAT A COMPANY CANNOT BE EXCLUDED FROM BEING COMPARABLE SIMPLY ON THE GROUND THAT IT HAS ABNORMAL PROFIT MARGIN SO LONG AS IT SATISFIES COMPAR ABILITY ANALYSIS. HOWEVER, IN PRESENT CASE, THE APPELLANT HAS GIVEN THE WORKING AS ABOVE THAT ULTRAMARINE & PIGMENTS LTD. HAS PROFIT MARGIN OF 155.79% DURING FY UNDER CONSIDERATION. THIS PROFIT MARGIN IS EXCEPTIONALLY HIGH AND IT NEEDS TO BE SEEN NOT IN IS OLATION BUT IN CONTEXT OF HIGH VOLATILITY OF PROFIT MARGINS IN PRECEDING AND SUCCEEDING YEAR. THESE FACTS INDICATE THAT THE SAID COMPANY HAS FAR WHICH IS NOT COMPARABLE WITH THAT OF THE TESTED PARTY IE. THE APPELLANT. IN VIEW OF THIS, THIS COMPANY NEEDS TO BE DELETED FROM SET OF COMPARABLES. THE GROUND OF APPEAL IS ALLOWED. 5. BEFORE US, THE L D. SR. DR SUBMITTED THAT HON BLE DELH I HIGH COURT IN THE CASE OF CHRYSC APITAL I NVESTMENT ADVISORS INDIA (P) LTD. VS. D EPUTY 6 ITA NO. 5228/DEL/2014 COMMISSIONER OF INCOME T AX IN ITA 417/2014 , IN DECISION PRONOUNCED ON 27/04/2015 , HELD THAT MERELY ON THE GROUND THAT AN ENTITY MAKES HIGHLY/EXTREMELY HIGH PROFITS/LOSSES DOES NOT, IPSO FACTO, LEAD TO ITS EXCLUSION FROM THE LIST OF COMPARABLES. HE FURTHER SUBMITTED THAT THE LEARNED CIT - (A) WAS NOT CORRECT IN HOLDING THAT THE SAID COMPARABLE WAS NOT FUNCTIONALLY SIMILAR TO THE ASSESSEE. 6. WE HAVE HEARD THE SUBMISSION OF THE LD. SR. DR ON THE ISSUE IN DISPUTE. IN THE CASE OF CHR YSC APITAL I NVESTMENT ADVISORS INDIA (P) LTD. VS. DCIT (SUPRA) FOLLOWING QUESTION S OF LAW WERE RAISED BEFORE THE HON BLE HIGH COURT: 1) WHETHER THE PROVISO TO RULE 10B(4) OF THE INCOME TAX RULES, 1962 WILL BE APPLICABLE IN CASE OF FLUCTUATIONS IN THE OPERATING PROFIT MARGINS OF COMPARABLE COMPANIES DURING THE RELEVANT FINANCIAL YEAR UNDER QUESTION AS COMPARED TO EARLIER YEARS? 2) WHETHER COMPARABLES CAN BE REJECTED ON THE GROUND THAT THEY HAVE EXCEPTIONALLY HIGH PROFIT MARGINS AS COMPARED TO THE ASSESSEE IN TRANSFER PRICING ANALYSIS? 3) WHETHER FACTORS LIKE DIFFERENTIAL FUNCTIONAL AND RISK PROFILE COUPLED WITH HIGH DEGREE OF VOLATILITY IN OPERATING PROFIT MARGINS IS SUFFICIENT GROUND TO REJECT COMPARABLES FOR TRANSFER PRICING ANALYSIS? 4) WHETHER DISALLOWANCES CAN BE MADE UNDER SECTION 36(1)(II) WHEN THE BONUS PAID TO SHAREHOLDERS IS NOT IN THE EXACT PROPORTION OF THEIR SHAREHOLDING AND THERE IS NO AVOIDANCE OF TAXES? 7. I N PARA - 44 OF THE DECISION, THE HON BLE HIGH COURT CONCLUDED AS UNDER: 44. IN LIGHT OF THE ABOVE FINDINGS, THIS COURT CONCLUDES AS FOLLOWS: A. THE MERE FACT THAT AN ENTITY MAKES HIGH/EXTREMELY HIGH PROFITS/LOSSES DOES NOT, IPSO FACTO, LEAD TO ITS EXCLUSION FROM THE LIST OF COMPARABLES FOR THE PURPOSES OF DETERMINATION OF ALP. IN SUCH CIRC UMSTANCES, AN ENQUIRY UNDER RULE 10B(3) OUGHT TO BE 7 ITA NO. 5228/DEL/2014 CARRIED OUT, TO DETERMINE AS TO WHETHER THE MATERIAL DIFFERENCES BETWEEN THE ASSESSEE AND THE SAID ENTITY CAN BE ELIMINATED. UNLESS SUCH DIFFERENCES CANNOT BE ELIMINATED, THE ENTITY SHOULD BE INCLUDED AS A COMPARABLE. B. WHILE DETERMINING THE COMPARABILITY OF TRANSACTIONS, MULTIPLE YEAR DATA CAN ONLY BE INCLUDED IN THE MANNER PROVIDED IN RULE ITA 417/2014 PAGE 52 10B(4). AS A GENERAL RULE, IT IS NOT OPEN TO THE ASSESSEE TO RELY UPON PREVIOUS YEAR S DATA. C . AS REGARDS KHANDWALA SECURITIES AND BRESCON, THE MATTER IS REMITTED TO THE DRP TO CARRY OUT THE ANALYSIS UNDER RULE 10B(3) AND DETERMINE WHETHER THE MATERIAL DIFFERENCES ARISING OUT OF THEIR EXCEPTIONALLY HIGH PROFITS CAN BE ELIMINATED. IF NOT, THE SAID ENTITIES CANNOT BE INCLUDED AS COMPARABLES. FOR KEYNOTE, FIRSTLY, ENQUIRY IS TO BE CARRIED OUT BY THE DRP, PRECEDING THE ANALYSIS UNDER RULE 10B(3), AS TO ITS FUNCTIONAL SIMILARITY WITH THE ASSESSEE; THEREAFTER, THE EXERCISE OF DETERMINING IF THERE ARE MAT ERIAL DIFFERENCES ON ACCOUNT OF EXCEPTIONALLY HIGH PROFITS WHICH ARE CAPABLE OF ELIMINATION HAS TO BE CARRIED OUT. D. THE DEDUCTION CLAIMED BY THE ASSESSEE UNDER SECTION 36(1)(II) OF THE ACT, IN RESPECT OF THE BONUSES PAID TO ITS SHAREHOLDER - EMPLOYEES IS ALLOWED. 8. W E FIND THAT THE IN THE INSTANT CASE THE ASSESSEE HAS NOT BEEN ABLE TO FIND OUT ANY MATERIAL DIFFERENCE BETWEEN THE ASSESSEE AND SAID ENTITY AS FAR AS FUNCTIONS CARRIED OUT, ASSETS EMPLOYED AND RISK TAKEN , I.E. , FAR AND , THEREFORE , RESPECTFULLY FOLLOWING THE FINDING OF THE HON BLE DELHI H IGH COURT IN THE CASE OF CHRYC APITAL INVESTMENT ADVISERS INDIA P RIVATE L IMITED VS. DCIT (SUPRA), WE HOLD THAT THE COMPARABLE M/S . ULTRAMINE AND P IGMENTS LTD . CANNOT BE EXCLUDED FROM THE FINAL SET OF COMPARABLES ONLY ON THE GROUND OF HIGH PROFIT DURING THE YEAR. T HE GROUND OF THE APPEAL OF THE R EVENUE IS ACCORDINGLY ALLOWED. 9. IN GROUND NO. 2 , THE R EVENUE C HALLENGED THE DIRECTION OF THE L D. CIT - (A) TO CONSIDER THE ADDITIONAL REMUNERATION OF RS.10,26,67,942/ - (WHICH WAS RECEIVED IN FINANCIAL YEAR 2006 - 07, BUT CLAIMED AS PERTAINING TO FINANCIAL YEAR UNDER CONSIDERATION) FOR COMPUTING PLI OF THE ASSESSEE 8 ITA NO. 5228/DEL/2014 FOR THE YEAR UNDER CONSIDERATION. THE LD. CIT - (A ) HAS ADJUDICATED THE ISSUE IN DISPUTE AS UNDER: 38.1 I HAVE DULY CONSIDERED SUBMISSIONS OF THE APPELLANT. THE CASE OF THE APPELLANT IS THAT IT HAS RECEIVED ADDITIONAL REMUNERATION OF RS. 102,667,942 FROM ITS AES PERTAINING TO THE PERIOD UNDER CONSIDERATION BUT RECEIVED AND DECLARED IN INCOME TAX RETURN IN FY 2006 - 07. THE APPELLANT HAS STATED THAT THIS ADDITIONAL REVENUE WAS NOT INCLUDED FOR WORKING OUT PLI FOR FY 2006 - 07. IF THIS ADDITIONAL REVENUE IS CONSIDERED FOR WORKING OUT PLI FOR AY UNDER CONSIDERATION, THEN EVEN WITHOUT GRANTING ADJUSTMENT FOR EXCESS CAPACITY, PROFIT MARGIN OF THE APPELLANT SHALL BE MORE THAT PROFIT MARGIN OF COMPARABLES TAKEN BY THE TPO. THE CASE OF THE TPO IS THAT THIS ADDITIONAL REVENUE HAS BEEN OFFERED FOR TAXATION BY THE APPELLANT FOR FY 2006 - 07 AND RETURN FOR AY 2005 - 06 HAS NOT BEEN REVISED BY THE APPELLANT. 38.2 I FIND FORCE IN CONTENTION OF THE APPELLANT THAT ADDITIONAL REVENUE RECEIVED DURING FY 2006 - 07 PERTAINS TO PERIOD UNDER CONSIDERATION AND IT HAS BEEN MEN TIONED SO IN FINANCIALS OF FY 2006 - 07. THE APPELLANT DID NOT CONSIDER IT WHILE COMPUTING PROFIT MARGIN FOR FY 2006 - 07. BY FOLLOWING MATCHING PRINCIPLE, THIS ADDITIONAL REVENUE NEEDS TO BE INCLUDED FOR COMPUTING PLI OF FY UNDER CONSIDERATION. THIS APPROACH HAS BEEN ACCEPTED BY DRP FOR THE SUBSEQUENT AY UNDER SIMILAR FACTS AND CIRCUMSTANCES. 10. BEFORE US , THE LD. SR. DR SUBMITTED THAT IT WAS NOT CLEAR , WHETHER THE RE - NEGOTIATED SERVICE FEE WAS FOR PROVISION OF THE IT ENABLED BACK - OFFICE SERVICES , OR IT IN CLUDED OTHER SERVICE FEE RECEIPTS. I.E. CALL C ENTR E SUPPORT SERVICE AND RECEIPT OF TECHNICAL CONSULT ANCY SE RVICES PROVIDED BY THE ASSESSEE. HE SUBMITTED THAT THIS ISSUE HAS NOT BEEN DISCUSSED EITHER BY THE LD. CIT - (A) OR BY THE TPO AND THERE FOR E, THE ISSUE NEED TO BE EXAMINE D AGAIN AT THE LEVEL OF THE TPO. 11. WE HAVE HEARD THE SUBMISSION OF THE LD. SR. DR ON THE ISSUE IN DISPUTE. THE LEARNED CIT - (A) HAS NOTED TH AT FOLLOWING MATCHING PRINCIPLE , THE ADDITIONAL REVENUE NEED TO BE INCLUDED IN THE PLI OF YEAR UNDER CONSIDERATION. THE LEANED CIT - (A) HAS ALSO NOTED THAT THIS APPROACH HAS BEEN ACCEPTED BY THE LD. DRP FOR THE SUBSEQUENT ASSESSMENT YEAR 9 ITA NO. 5228/DEL/2014 UNDER SAME FACTS AND CIRCUMSTANCES. IN VIEW OF THE F ACTS, IN OUR OPINION , FOLLOWING THE RULE OF CONSISTENCY, WE AGREE WITH THE FINDING OF THE LEARNED CIT - (A) THAT THE ADDITIONAL REVENUE IN QUESTION NEEDS TO BE INCLUDED IN FOR COMPUTING PLI OF THE YEAR UNDER CONSIDERATION. HOWEVER, WHETHER THE ADDITIONAL REV ENUE FEE RECEIVED PERTAINS TO IT ENABLED SERVICES I.E. RELEVANT INTERNATIONAL TRANSACTION , HAS NOT BEEN EXAMINED BY THE LOWER AUTHORITIES, THUS, WE FEEL IT APPROPRIATE TO RESTORE THE ISSUE TO THE FILE OF THE AO/TPO FOR VERIFYING THE FACTS AND DECIDE THE IS SUE IN ACCORDANCE WITH LAW. THE ASSESSEE SHALL BE AFFORDED ADEQUATE OPPORTUNITY OF BEING HEARD. ACCORDINGLY , THE GROUND OF THE AP PEAL IS ALLOWED FOR STATISTICAL PURPOSES. 12. THE GROUND NO. 3 OF THE APPEAL BEING GENERAL IN NATURE , WE ARE NOT REQUIRED TO AD JUDICATE UPON AND ACCORDINGLY, DISMISS AS INFRUCTUOUS. 13. IN THE RESULT , APPEAL OF THE R EVENUE IS ALLOWED PARTLY FOR STATISTICAL PURPOSES. THE DECISION IS PRONOUN CED IN THE OPEN COURT ON 6 T H N O V E M B E R , 201 7 . S D / - S D / - ( H.S. SIDHU ) ( O.P. KANT ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 6 T H N O V E M B E R , 201 7 . RK / - (D.T.D) COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR ASST. REGISTRAR, ITAT, NEW DELHI