THE ACIT 10(3), V. M/S. GENOM BIOTECH PVT. LTD, MUMBAI

ITA 5272/MUM/2007

• Counselvise Citation: 527219914 RSA 2007
• Duration Of Justice: 4 year(s) 9 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: L
• Next Hearing Date: 25-04-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 06-08-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Transfer pricing; International transaction; Additional evidence; Arm length price
• Section: 92C; 92D; 92F; 92E

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES L : MUMBAI BEFORE SHRI B.R. MITTAL, JUDICIAL MEMBER AND SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER ITA. NO. 5272/MUM/2007 ASSESSMENT YEAR 2004-2005 ACIT - 10 (3) MUMBAI 400 020. VS. M/S. GENOM BIOTECH PVT. LTD. MUMBAI 400 076 PAN AABCG1013B (APPELLANT) (RESPONDENT) FOR APPELLANT : SHR I AJIT KUMAR JAIN FOR RESPONDENT : SHRI FIROZE B. ANDHYARUJINA DATE OF HEARING : 25-04-2012 DATE OF PRONOUNCEMENT : 16-05-2012 ORDER PER J.SUDHAKAR REDDY, A.M. 1. THIS IS AN APPEAL FILED BY THE REVENUE DIRECTE D AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-10, MUMBAI DATED 8-5-2007 FOR THE ASSESSMENT YEAR 2004-2005. 2. FACTS IN BRIEF. THE ASSESSEE IS A COMPANY AND E NGAGED IN THE BUSINESS OF MANUFACTURING AND EXPORT OF PHARMACEUTI CAL PRODUCTS. IT FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2004-2005 ON 2 7-10-2004 DECLARING TOTAL INCOME AT RS.2,12,88,722/-. ALONG WITH RETURN OF I NCOME, THE ASSESSEE- COMPANY FILED AUDIT REPORT UNDER SECTION 92E IN THE PRESCRIBED FORM NO.3CEB IN RELATION TO INTERNATIONAL TRANSACTIONS ALONG WIT H OTHER AUDIT REPORTS AND FORMS. 3. THE ASSESSEE HAS ENTERED INTO INTERNATIONAL TRA NSACTIONS WITH ASSOCIATED ENTERPRISES FOR (A) EXPORT SALE OF PHARM A PRODUCTS AND (B) 2 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. REIMBURSEMENTS OF BUSINESS PROMOTION EXPENSES. THE MATTER HAS BEEN REFERRED TO THE TRANSFER PRICING OFFICER. THE TRANSFER PRICI NG OFFICER-IV, WEST ZONE, INDIA VIDE ORDER DATED 8-12-2006 PASSED UNDER SECTION 92C A(3) HAD DETERMINED THE ARMS LENGTH PRICE OF THE INTERNATIONAL TRANSACTION OF REIMBURSEMENT OF BUSINESS PROMOTION EXPENSES AT RS.2,13,46,528/- AS AGAINST THE ARMS LENGTH PRICE OF RS.32,11,57,736/- DETERMINED BY THE ASSESS EE AND MADE AN UPWARD ADJUSTMENT TO THE TUNE OF RS.29,98,11,208/-. THE AR MS LENGTH PRICE OF EXPORT SALES WAS ACCEPTED BY THE TPO. THE CIT(A) AT PAGES 1 TO 3 OF HIS ORDER HAS BROUGHT OUT THE REPORT OF THE TPO. AT PAGE 5, THE TPOS FINDINGS WERE SUMMARIZED WHICH IS EXTRACTED HEREUNDER FOR READY R EFERENCE : TO SUMMARISE THE TPO HAS BASED HIS FINDINGS ON - A) THE ASSESSEE SHOULD HAVE ITS AES AT UKRAINE OR RUS SIA INSTEAD OF CYPRUS. B) THE MONEY EARNED FROM THE BUSINESS IN INDIA IS LARG ELY TRANSFERRED TO ASSESSEES TWO A.ES IN CYPRUS, A TAX HEAVEN. C) ALLOWABILITY OF EXPENDITURE IS PRIMARILY THE SUBJEC T MATTER OF A.O. THE A.O. IS REQUIRED TO LOOK INTO THIS MATTER AND F IND OUT THE WAYS IN CONSULTATION WITH FTD, CBDT TO CARRY OUT THE INV ESTIGATION OUTSIDE THE BOUNDARIES OF INDIA AS THESE TRANSACTIO N PRIMA FACIE APPEAR DOUBTFUL. D) SINCE DIRECT INVESTIGATION IS NOT POSSIBLE, THE OTH ER BEST METHOD AS PRESCRIBED IN LAW IS APPLICATION OF TNMM. E) THERE IS GREATEST DIFFICULTY IN COMMENTING UPON THI S XEROX COPIES IS TO DECIPHER WHAT IS WRITTEN IN FOREIGN LANGUAGE AND CARRYING OUT ACTUAL PHYSICAL VERIFICATION OF THESE EXPENSES AS THEY HAVE BEEN INCURRED OUTSIDE THE TERRITORY OF INDIA. AS SU CH, THESE PAPERS NEITHER PROVE NOR DISPROVE ANYTHING. F) ASSESSEE IS SELLING PRODUCTS WHICH ARE HIGH IN DEMA ND AND CATER TO NICHE MARKET, THROUGHOUT THE WORLD, PRODUCTS REL ATED WITH 3 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. ENHANCEMENT OF SEXUAL POTENCY ARE SOLD AT PREMIUM A ND HARDLY ANY ADVERTISEMENT IS REQUIRED. G) THESE PRODUCTS ARE NOT SOLD DIRECTLY IN UKRAINE MAR KET BUT TO THE CONSIGNEES NAMELY, OPTIMA FARMI LTD., TRIGAM INTERN ATIONAL, DP APOLLO & DP OSIAN PHARMA, UKRAINE. 4. THE ASSESSING OFFICER AFTER CONSIDERING THE SUB MISSIONS OF THE ASSESSEE MADE A T.P. ADJUSTMENT BASED ON THE TPOS ORDER. THERE IS NO ADDITION AS FAR AS EXPORT SALE OF PHARMA PRODUCTS A RE CONCERNED. THE TRANSFER PRICING ADJUSTMENT IS ONLY ON THE ISSUE OF REIMBURS EMENT PAID FOR BUSINESS PROMOTION EXPENSES. 5. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN A PPEAL BEFORE THE FIRST APPELLATE AUTHORITY. THE FIRST APPELLATE AUTHORITY DELETED THE ADDITION ON THE FOLLOWING GROUNDS : (A) THERE ARE NO DEFECTS IN RESPECT OF INFORMATION AND DOCUMENTS KEPT UNDER SECTION 92D AND AS PRESCRIBED UNDER RULE 10B(B). (B) IN THE PREVIOUS YEAR THE TOTAL AMOUNT PAID TO A E FOR ADVERTISEMENT WAS RS.6,43,58,749/-, WHICH CORRESPON DED TO 30.92% OF TOTAL SALES AND THESE TRANSACTIONS OF THE EARLIER YEARS WERE ACCEPTED BY THE ASSESSING OFFICER. THE T POS ASSUMPTION TO RESTRICT ADVERTISEMENT AND MARKETING EXPENSES TO 10% OF TOTAL SALES OF RS.54 CRORES IS NOT SUPPOR TED WITH ANY LOGIC. (C) THAT OPERATING MARGINS TO SALES AND OPERATING P ROFIT TO COST WERE NOT COMPARABLE WITH THE STUDY OF 17 UNITS CARR IED OUT BY TPO. (D) EVEN THE STUDY CARRIED OUT FOR THOSE COMPANIES, THE ADVERTISING AND MARKETING EXPENSES VARY BETWEEN 5.2 7% TO 4 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. 31.89% AND TAKING MEAN OF ALL COMPANIES FOR BENCHMA RKING IS NOT JUSTIFIED. (E) THAT ASSESSING OFFICER HAS NOT POINTED OUT ANY DEFECTS IN THE BILL FOR REIMBURSEMENT SUPPORTED WITH VOUCHERS. (F) THAT THE REMITTANCE BEAR APPROVAL OF RBI AND OT HER MONITORING AGENCIES. (G) THAT TPO HAS ACCEPTED THE SALE TRANSACTION WITH CUP/CPM METHOD WAS ADOPTED AND GAVE A FINDING THAT THE MARG IN DECLARED WAS BETTER THAN THE INDUSTRY AVERAGE OF 55 % - 65%. (H) THAT TPO ALLOWED 10% OF TOTAL SALES, WHICH INCL UDED EXPENSES INCURRED IN INDIA AND THIS ASSUMPTION IS I LLOGICAL. (I) THE ASSESSING OFFICER AND TPO HAVE NOT BROUGHT OUT ANY EVIDENCE ON RECORD THAT PART OF MONEY PAID TO THE A ES WAS RETURN BACK TO ASSESSEE. (J) THAT SHARES IN THE AES WERE TRANSFERRED TO OTHE R UNRELATED PARTIES ON 20-10-2003 AND THEREAFTER, THE ASSESSEE HAD NO CONTROL OVER AES AFTER THAT DATE. IT WOULD BE WRONG TO PRESUME THAT THE ASSESSEE HAS TRANSFERRED FUNDS TO AES WHICH IT HAS ULTIMATELY LOST CONTROL OFF. HE DELETED THE ADDITION. 6. AGGRIEVED, REVENUE FILED THIS APPEAL ON THE FOLL OWING GROUNDS : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AS WELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED IN ALLOWING RS.32,11,57,736/- I.E., 87.73% AS ADVERTISEMENT EXP ENSES ON SALE OF RS.36,60,04,484/- MADE THROUGH THE ASSOC IATED ENTERPRISES. 5 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AS WELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED ALLOWING 60.33 % OF THE NET SALES AS MARKETING EXPENSES AS AGAINST THE INDU STRY AVERAGE OF 5.16% AND THE TOP 17 COMPANIES AVERAGE O F 10.66%. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AS WELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED NOT TAKING INT O ACCOUNT THE FACT THAT IN THE IMMEDIATELY PRECEDING YEAR, TH E EXPENDITURE ON ADVERTISEMENT WAS ONLY TO THE TUNE O F 30.92% OF THE TOTAL SALES. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AS WELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED IN ACCEPTING T HE ADDITIONAL EVIDENCE IN THE FORM OF THE COPIES OF TH E BILLS OF THE PARTIES WHO CARRIED OUT THE ADVERTISEMENT WITHO UT GIVING AN OPPORTUNITY TO THE ASSESSING OFFICER AS PROVIDED UNDER RULE 46A. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AS WELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED IN ALLOWING TH E EXPENDITURE ON ADVERTISEMENT MERELY ON THE BASIS OF BILLS OF THE PARTIES WHO CARRIED OUT THE ADVERTISEMENT WORK WITHOUT VERIFYING THE GENUINENESS OF THE SAME. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AS WELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED IN ACCEPTING T HE CONTENTION OF THE ASSESSEE THAT SINCE THE SHARES OF THE ASSOCIATES ENTERPRISES WERE TRANSFERRED TO UNRELATE D PERSONS DURING THE YEAR, THE ASSESSEE HAD NO CONTROL OVER T HEM, WITHOUT VERIFYING THE GENUINENESS OF THE FACTUM OF TRANSFER. 6 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. 7. LEARNED D.R. MR. AJIT KUMAR JAIN SUBMITTED THAT THE TPO ORDER SHOULD HAVE BEEN UPHELD BY THE COMMISSIONER OF INCO ME TAX. HE TOOK THIS BENCH THROUGH THE ORDER OF THE TPO PASSED UNDER SEC TION 92CA(3) OF THE ACT ON 8-12-2006 SPECIFICALLY FINDING AT PARA-5. HE POI NTED OUT THAT THE TPO RECORDED THAT, FOR THE EXPORT SALE OF RS.50.12 CROR ES, THE ADVERTISEMENT EXPENSES ARE AT RS.32.58 CRORES WHICH IS 60.33% OF TOTAL SALES. HE POINTED OUT THAT ASSESSEES NET PROFIT BEFORE TAX WAS 5.8% OF T HE SALES. HE SUBMITTED THAT THE ASSESSEE HAS INCURRING UNUSUALLY HIGH EXPENDITU RE ON ADVERTISEMENT ABROAD. HE SUBMITTED THAT THOUGH THE ASSESSEE HAS P RODUCED ALL DETAILS, THE TPO WAS NOT ABLE TO DECIPHER THE DOCUMENTS IN FOREI GN LANGUAGE OR ACTUALLY CARRY-OUT THE PHYSICAL VERIFICATION OF THE EXPENSES . HE SUBMITTED THAT IT IS EVIDENT THAT TWO OF THE ASSESSEES AES ARE LOCATED IN CYPRUS WHICH IS A TAX HEAVEN. HE SUPPORTED THE FINDING OF THE TPO THAT TH E TRANSACTIONS PRIMA FACIE APPEAR TO BE DOUBTFUL. 7.1. THEREAFTER, HE TOOK THIS BENCH TO THE FINDING OF THE TPO WHEREIN ARMS LENGTH PRICE HAS BEEN DETERMINED, BY TAKING TH E AVERAGE OF EXPENDITURE INCURRED ON MARKETING AND ADVERTISEMENT, BY 17 TOP PHARMA COMPANIES. HE SUBMITTED THAT THE ASSESSING OFFICER HAS CORRECTLY TOOK THE INDUSTRY AVERAGE ON MARKETING EXPENDITURE OF 17 PHARMA COMPANIES AND HE LD IT TO BE A BENCHMARK, FOR DETERMINING THE ARMS LENGTH PRICE. 7.2. HE QUESTIONED THE FINDINGS OF THE CIT(A) AND SUBMITTED THAT MOST OF THE CONCLUSIONS ARE AGAINST THE LAW SPECIFICALLY THE FINDING (A) THAT MONEY HAS NOT BEEN RETURNED, TO THE AE, (B) REGULATORY AU THORITIES HAVE GRANTED APPROVALS, (C) AUDITORS HAVE VERIFIED ETC., AS THER E ARE NOT TESTS LAID OWN IN COMPUTING ARMS LENGTH PRICE AND MAKING AN ADJUSTMEN T. AS PER THE LEARNED D.R. THE BASIC QUESTION IS, WHO IS THE OWNER OF THE PRODUCT AND WHO IS TO GET THE BENEFIT OF INTANGIBLES ? HE SUBMITTED THAT THE PRODUCT IS MANUFACTURED BY THE ASSESSEE AND THE BENEFIT IS DERIVED BY THE AES AND HENCE, THE EXPENDITURE 7 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. SHOULD BE BORNE BY THE AES AND NOT BY THE ASSESSEE- COMPANY. HE PRAYED THAT THE ORDER OF THE ASSESSING OFFICER BE UPHELD. 8. LEARNED SENIOR COUNSEL, APPEARING ON BEHALF OF THE ASSESSEE, MR. FIROZE B. ABDHYARUJINA ON THE OTHER HAND HAS SUBMIT TED THAT THERE ARE NUMBER OF MISTAKES IN THE GROUNDS OF APPEAL. HE SUBMITTED THAT FUNDAMENTALLY THE TPO HAS EXCEEDED ITS JURISDICTION UNDER THE LAW. HE ARGUED THAT SECTION 92F OF THE I.T. ACT HAVE COME INTO FORCE W.E.F. THE YEAR 2 002-2003 AND UNDER SECTION 92CA THE TPO IS REQUIRED TO DETERMINE THE ARMS LENG TH PRICE OF AN INTERNATIONAL TRANSACTION. HE POINTED OUT THAT IT I S ONLY THE ASSESSING OFFICER WHO IS REQUIRED TO COMPUTE THE INCOME. HE RELIED ON BOARD INSTRUCTION NO.3 DATED 20-5-03, PARAGRAPHS II AND III AND SUBMITTED THAT THE TPO HAS COMMITTED AN ERROR BY GOING INTO THE ASPECT OF GENU INENESS OF THE EXPENDITURE AND ALSO THE ASPECT OF AS TO WHETHER THE EXPENDITUR E SHOULD BE BORNE BY THE ASSESSEE OR AE. HE SUBMITTED THAT TRANSACTION NET M ARGIN METHOD (TNMM) HAS BEEN DISCUSSED IN THE INCOME TAX RULES AND WHAT THE TPO DID IS AGAINST THE RULES. HE SUBMITTED THAT TAKING ALL INDUSTRY AVERAG E OF ADVERTISING AND MARKETING EXPENDITURE INCURRED AND THEN TREATING IT AS THE ARMS LENGTH PERCENTAGE, IS NOT CONTEMPLATED AS PER RULES. HE SU BMITTED THAT NO DEFECT IN INFORMATION WAS POINTED OUT BY TPO OR ASSESSING OFF ICER AND THAT THE REVENUE HAS ACCEPTED THAT THERE IS NO MARK-UP ON EXPENSES. HE FILED THE ORDER OF THE TPO FOR THE ASSESSMENT YEAR 2003-2004 DATED 9-3-200 6 AND SUBMITTED THAT THE REIMBURSEMENT OF EXPENSES FOR MARKETING AND ADV ERTISEMENT WAS ACCEPTED AND NO ADJUSTMENT WAS SUGGESTED. HE ARGUED THAT CYP RUS IS NOT A TAX HEAVEN AND DUE TO THE FACT THAT THE BANKING SYSTEM IN UKRA INE AND OTHER SUCH COUNTRIES, WAS NOT ACCEPTED BY THE GOVERNMENT, CYPR US WAS THE PLACE WHERE AES WERE LOCATED. HE POINTED OUT THE ASSESSEE ADOPT ED CUP METHOD AND THE ASSESSING OFFICER HAS NOT REJECTED THE SAME. HE REL IED HEAVILY ON THE ORDER OF THE CIT(A). 8 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. 9. IN REPLY, THE LEARNED DR SUBMITTED THAT THE FUN DAMENTAL ISSUE TO BE DECIDED IS WHETHER THE EXPENDITURE ON MARKETING AND ADVERTISEMENT, IS TO BE BORNE BY THE ASSESSEE OR THE AE ? 10. RIVAL SUBMISSIONS HEARD. ON A CAREFUL CONSIDER ATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND A PERUSAL OF THE PAPERS ON RECORD AND THE ORDERS OF THE AUTHORITIES BELOW WE HOLD AS FOLLOWS : 10.1. ASSESSEE HAS USED COST PLUS METHOD TO JUSTIF Y THAT THE TRANSACTIONS ARE AT ARMS LENGTH. THE ASSESSEE ULTIM ATELY SOLD PRODUCTS IN UKRAINE BUT ROUTED THE SAME THROUGH ITS ASSOCIATED ENTERPRISE LOCATED IN CYPRUS. REASON GIVEN BY THE ASSESSEE IS THAT UKRAIN E IS POLITICALLY AND ECONOMICALLY VERY INSTABLE IN THAT PERIOD AFTER DIS INTEGRATION FROM USSR AND THAT THE BANKING SYSTEM IS NOT RELIABLE AND CURRENC Y WAS DEVALUED FROM TIME TO TIME. IT WAS ALSO POINTED THAT INDIAN BANKS ARE NOT RECOGNISING NOR ARE READY TO DEAL WITH UKRAINE BANKS FAVOURABLY IN THOSE YEARS. 10.2. WE FIND THAT THE TPO IN HIS ORDER HAS NOT GI VEN ANY REASON AS TO WHY HE IS REJECTING THE CUP METHOD ADOPTED BY THE A SSESSEE FOR DETERMINING THE ARMS LENGTH PRICE FOR REIMBURSEMENT OF BUSINESS PROMOTION EXPENSES BY THE ASSESSEE TO THE AES. IT IS WELL SETTLED THAT NO METHOD CAN BE REJECTED WITHOUT GIVING COGENT REASONS. THE TPO HAS TO STATE WHY CUP METHOD IS NOT APPLICABLE IN THIS CASE. AFTER ASSIGNING REASONS, T HEN THE TPO HAS TO STATE AS TO HOW TNMM IS THE MOST APPROPRIATE METHOD, TO BE AP PLIED ON THE FACTS AND CIRCUMSTANCES OF THIS CASE. THIS IS NOT DONE. THERE IS NO WHISPER ON THESE ISSUES IN THE ORDER OF THE TPO. WITHOUT GIVING ANY REASONS FOR THE REJECTION OF CUP METHOD, THE TPO, APPLIES THE MEAN OF PERCENTA GE OF EXPENDITURE INCURRED BY 17 PHARMACEUTICAL COMPANIES ON ADVERTIS EMENT AND MARKETING AND TERMS THE SAME AS ARM LENGTH PRICE ARRIVE BY US ING TNMM. THIS IS NOT TNMM. 10.3. SECTION 10B(E) READS AS FOLLOWS : 9 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. (E) TRANSACTIONAL NET MARGIN METHOD, BY WHICH, - (I) THE NET PROFIT MARGIN REALIZED BY THE ENTERPRIS E FROM AN INTERNATIONAL TRANSACTION ENTERED INTO WITH AN ASSO CIATED ENTERPRISE IS COMPUTED IN RELATION TO COSTS INCURRE D OR SALES EFFECTED OR ASSETS EMPLOYED OR TO BE EMPLOYED BY TH E ENTERPRISE OR HAVING REGARD TO ANY OTHER RELEVANT B ASE; (II) THE NET PROFIT MARGIN REALIZED BY THE ENTERPRI SE OR BY AN UNRELATED ENTERPRISE FROM A COMPARABLE UNCONTROLLED TRANSACTION OR A NUMBER OF SUCH TRANSACTIONS IS COMPUTED HAVING REGARD TO THE SAME BASE; (III) THE NET PROFIT MARGIN REFERRED TO IN SUB-CLAU SE (II) ARISING IN COMPARABLE UNCONTROLLED TRANSACTIONS IS ADJUSTED TO TAKE INTO ACCOUNT THE DIFFERENCES, IF ANY, BETWEEN THE INTERNATIONAL TRANSACTION AND THE COMPARABLE UNCONT ROLLED TRANSACTIONS, OR BETWEEN THE ENTERPRISES ENTERING I NTO SUCH TRANSACTIONS, WHICH COULD MATERIALLY AFFECT THE AMO UNT OF NET PROFIT MARGIN IN THE OPEN MARKET; (IV) THE NET PROFIT MARGIN REALIZED BY THE ENTERPRI SE AND REFERRED TO IN SUB-CLAUSE (I) IS ESTABLISHED TO BE THE SAME AS THE NET PROFIT MARGIN REFERRED TO IN SUB-CLAUSE (III); (V) THE NET PROFIT MARGIN THUS ESTABLISHED IS THEN TAKEN INTO ACCOUNT TO ARRIVE AT AN ARMS LENGTH PRICE IN RELAT ION TO THE INTERNATIONAL TRANSACTION. 10.4. A PLAIN READING OF THIS RULE DEMONSTRATES TH AT THE METHODOLOGY ADOPTED BY THE ASSESSING OFFICER IS AGAINST THE LAW . IT IS NOT RIGHT TO PICK-UP 17 PHARMACEUTICAL COMPANIES, LOOK INTO THE PERCENTAGE OF EXPENDITURE INCURRED BY EACH ONE OF THEM ON MARKETING AND ADVERTISEMENT AND THEN ARRIVED AT A 10 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. AVERAGE OR MEAN AND HOLD THAT THIS AVERAGE PERCENTA GE IS THE INDUSTRY AVERAGE AND APPLY THE SAME AS THE ARMS LENGTH PERCENTAGE OF EXPENDITURE TO BE INCURRED BY THE ASSESSEE. MEAN OF PERCENTAGE OF A C ERTAIN TYPE OF EXPENDITURE CANNOT BE ARMS LENGTH PRICE. THE METHOD FOLLOWED BY TPO IS NOT TNMM. 10.5. THIS TRIBUNAL IN THE CASE OF UCB INDIA (P.) LTD. VS. ACIT (2009) 121 ITD 131 HELD AS FOLLOWS : 68. WE NOW CONSIDER THE SECOND LIMB OF INVOKING PROVI SIONS OF SECTION 92C, I.E., THE ADOPTION OF TNMM BY THE ASSE SSEE. THE ASSESSEE HAS ADOPTED THE TNMM BY COMPARING THE OVER ALL OPERATING PROFITS OF THE ASSESSEE COMPANY WITH THE OVERALL OPERATING PROFITS OF CERTAIN OTHER ORGANIZATIONS OR COMPANIES WHICH WERE THE COMPARABLE COMPANIES SELECTED BY IT, FROM OUT OF DATA AVAILABLE IN THE PUBLIC DOMAIN, BY USIN G THE SOFTWARE PROWESS AND ADOPTING VARIOUS FILTERS FOR ELIMINATION OF UNCOMPARABLES AS LISTED OUT BY IT. T HE ASSESSEE CLASSIFIES ITSELF AS A LICENSED MANUFACTUR ER AND THUS HAVING LESSER RISKS. WHILE SO THE LEARNED SENI OR DEPARTMENTAL REPRESENTATIVE IS RIGHT IN POINTING OU T THAT THE COMPARABLES SELECTED BY THE ASSESSEE ARE NOT OF LIC ENSED MANUFACTURERS OF THE SIMILAR COMMODITY. THE TNMM COMPARES NET MARGINS OF UNCONTROLLED TRANSACTIONS B ETWEEN INDEPENDENT ENTITIES, WITH THOSE ACHIEVED IN CONTRO LLED TRANSACTIONS BETWEEN RELATED PARTIES. THE TRIBUNAL IN THE CASE OF AZTEC SOFTWARE & TECHNOLOGY SERVICES LTD. ( SUPRA) ON PAGE 238 OBSERVED AS FOLLOWS: 'THE TNMM REQUIRES ESTABLISHING COMPARABILITY AT A BROAD FUNCTIONAL LEVEL. IT REQUIRES COMPARISON BETWEEN NE T MARGINS DERIVED FROM THE OPERATION OF THE UNCONTROLLED PART IES AND NET MARGIN DERIVED BY AN ASSOCIATED ENTERPRISE ON S IMILAR OPERATIONS. UNDER THIS METHOD, THE NET PROFIT MARGIN REALIZED B Y AN ASSOCIATED ENTERPRISE FROM AN INTERNATIONAL TRANSAC TION IS COMPUTED IN RELATION TO A PARTICULAR FACTOR SUCH AS COSTS INCURRED, SALES, ASSETS UTILIZED, ETC. THE NET PROF IT MARGIN REALIZED BY AN ASSOCIATED ENTERPRISE IS COMPARED WI TH NET PROFIT MARGIN OF THE UNCONTROLLED TRANSACTIONS TO A RRIVE AT THE ALP. THE TNMM IS SIMILAR TO RPM AND CPM TO THE EXTE NT THAT 11 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. IT INVOLVES COMPARISON OF MARGIN EARNED IN A CONTRO LLED SITUATION WITH MARGINS EARNED FROM COMPARABLE UNCON TROLLED SITUATION. THE ONLY DIFFERENCE IS THAT, IN THE RPM AND CPM METHODS, COMPARISON IS OF MARGINS OF GROSS PROFITS AND WHEREAS IN TNMM THE COMPARISON IS ON MARGINS OF NET PROFIT. TNMM REQUIRES COMPARISON BETWEEN NET MARGINS DERIVE D FROM THE OPERATIONS OF THE UNCONTROLLED PARTIES AND NET MARGINS DERIVED BY AN ASSOCIATED ENTERPRISE FROM SI MILAR OPERATIONS. NET MARGIN IS INDICATED BY THE RATE OF RETURN ON SALES OR COST OF OPERATING ASSETS, AND THIS FORMS T HE BASIS FOR TNMM. A FUNCTIONAL ANALYSIS OF THE TESTED PARTY OR THE INDEPENDENT ENTERPRISE, AS THE CASE MAY BE, IS REQU IRED TO DETERMINE WHETHER THE TRANSACTIONS ARE COMPARABLE A ND THE ADJUSTMENTS THAT ARE REQUIRED TO BE MADE TO OBTAIN RELIABLE RESULTS. THE TESTED PARTY WOULD HAVE TO CONSIDER OT HER FACTORS, LIKE COST OF ASSETS OF COMPARABLE COMPANIE S, ETC., WHILE APPLYING THE RETURN ON ASSETS MEASURE. ORDINA RILY, THE TESTED PARTY, HAS TO BE THE PARTY PROVIDED SERVICES BECAUSE IT IS ON THE BASIS OF RATE OF RETURN ON SALES OR CO ST OR OPERATING ASSETS THAT TRANSACTIONAL MARGIN IS COMPU TED. THESE PARAMETERS GENERALLY AVAILABLE IN THE CASE OF A PARTY PROVIDING SERVICES.' 69. UNDER THE TRANSFER PRICING REGULATIONS THE FOLLOW ING STEPS ARE TO BE TAKEN TO DETERMINE THE TNMM : STEP 1 : THE NET PROFIT MARGIN REALIZED BY AN ENTER PRISE FROM AN INTERNATIONAL TRANSACTION ENTERED INTO WITH AN A E IS COMPUTED IN RELATION TO COSTS INCURRED OR SALES EFF ECTED OR ASSETS EMPLOYED OR TO BE EMPLOYED BY THE ENTERPRISE OR HAVING REGARD TO ANY OTHER RELEVANT BASE. STEP 2 : THE NET PROFIT MARGIN REALIZED BY THE ENTE RPRISE OR BY AN UNRELATED ENTERPRISE, FORM A COMPARABLE UNCONTRO LLED TRANSACTION OR A NUMBER OF SUCH TRANSACTIONS IS COM PUTED HAVING REGARD TO THE SAME BASE. STEP 3 : THE NET PROFIT MARGIN REFERRED TO IN STEP 1 ARISING IN COMPARABLE UNCONTROLLED TRANSACTIONS IS ADJUSTED TA KING INTO ACCOUNT THE DIFFERENCES, IF ANY, BETWEEN THE INTERN ATIONAL TRANSACTION AND THE COMPARABLE UNCONTROLLED TRANSAC TION OR BETWEEN THE ENTERPRISE ENTERING INTO SUCH TRANSACTI ONS, WHICH WOULD MATERIALLY AFFECT THE AMOUNT OF NET PRO FIT MARGIN IN THE OPEN MARKET. 12 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. STEP 4 : THE NET PROFIT MARGIN REALIZED BY THE ENTE RPRISE AND REFERRED TO IN STEP 1 IS ESTABLISHED TO BE THE SAME AS THE NET PROFIT MARGIN REFERRED IN STEP 3. STEP 5 : THE NET PROFIT MARGIN THUS ESTABLISHED IS THEN TAKEN INTO ACCOUNT TO ARRIVE AT AN ARMS LENGTH PRICE IN RELATION TO THE INTERNATIONAL TRANSACTION. 70. SECTION 92C(1) REFERS TO ARMS LENGTH PRICE IN RE LATION TO AN INTERNATIONAL TRANSACTION. RULE 10B(1)(E) READ WITH SECTION 92C DEALS WITH TNMM, AND IT REFERS TO ONLY NET PROF IT MARGIN REALIZED BY AN ENTERPRISE FROM AN INTERNATIONAL TRA NSACTION OR A CLASS OF SUCH TRANSACTION, BUT NOT OPERATIONAL MARGINS OF ENTERPRISES AS A WHOLE. PARAGRAPH 3.26 OF TRANSFER PRICING GUIDELINES FOR MULTINATIONAL ENTERPRISES AND TAX ADMINISTRATIONS ISSUED BY OECD READS AS FOLLOWS : '3.26 THE TRANSACTIONAL NET MARGIN METHOD EXAMINES THE NET PROFIT MARGIN RELATIVE TO AN APPROPRIATE BASE (E.G. , COSTS, SALES, ASSETS) THAT A TAXPAYER REALIZES FROM A CONT ROLLED TRANSACTION (OR TRANSACTIONS THAT ARE APPROPRIATE T O AGGREGATE UNDER THE PRINCIPLES OF CHAPTER I). THUS, A TRANSACTIONAL NET MARGIN METHOD OPERATES IN A MANNE R SIMILAR TO THE COST PLUS AND RESALE PRICE METHODS. THIS SIMILARITY MEANS THAT IN ORDER TO BE APPLIED RELIAB LY, THE TRANSACTIONAL NET MARGIN METHOD MUST BE APPLIED IN A MANNER CONSISTENT WITH THE MANNER IN WHICH THE RESA LE PRICE OR COST PLUS METHOD IS APPLIED. THIS MEANS IN PARTI CULAR THAT THE NET MARGIN OF THE TAXPAYER FROM THE CONTROLLED TRANSACTION (OR TRANSACTIONS THAT ARE APPROPRIATE T O AGGREGATE UNDER THE PRINCIPLES OF CHAPTER I) SHOULD IDEALLY BE ESTABLISHED BY REFERENCE TO THE NET MARGIN THAT THE SAME TAXPAYER EARNS IN COMPARABLE UNCONTROLLED TRANSACTI ONS. WHERE THIS IS NOT POSSIBLE, THE NET MARGIN THAT WOU LD HAVE BEEN EARNED IN COMPARABLE TRANSACTIONS BY AN INDEPE NDENT ENTERPRISE MAY SERVE AS A GUIDE. A FUNCTIONAL ANALY SIS OF THE ASSOCIATED ENTERPRISE AND, IN THE LATTER CASE, THE INDEPENDENT ENTERPRISE IS REQUIRED TO DETERMINE WHE THER THE TRANSACTIONS ARE COMPARABLE AND WHAT ADJUSTMENTS MA Y BE NECESSARY TO OBTAIN RELIABLE RESULTS. FURTHER, THE OTHER REQUIREMENTS FOR COMPARABILITY, AND IN PARTICULAR T HOSE OF PARAGRAPHS 3.34 TO 3.40, MUST BE APPLIED.' 71. PARAGRAPH 3.42 OF TRANSFER PRICING GUIDELINES FOR MULTINATIONAL ENTERPRISES AND TAX ADMINISTRATIONS I SSUED BY OECD READS AS FOLLOWS : 13 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. '3.42 AN ANALYSIS UNDER THE TRANSACTIONAL NET MARGI N METHOD SHOULD CONSIDER ONLY THE PROFITS OF THE ASSO CIATED ENTERPRISE THAT ARE ATTRIBUTABLE TO PARTICULAR CONT ROLLED TRANSACTIONS. THEREFORE, IT WOULD BE INAPPROPRIATE TO APPLY THE TRANSACTIONAL NET MARGIN METHOD ON A COMPANY-WI DE BASIS IF THE COMPANY ENGAGES IN A VARIETY OF DIFFER ENT CONTROLLED TRANSACTIONS THAT CANNOT BE APPROPRIATEL Y COMPARED ON AN AGGREGATE BASIS WITH THOSE OF AN INDEPENDENT ENTERPRISE. SIMILARLY, WHEN ANALYZING T HE TRANSACTIONS BETWEEN THE INDEPENDENT ENTERPRISES TO THE EXTENT THEY ARE NEEDED, PROFITS ATTRIBUTABLE TO TRA NSACTIONS THAT ARE NOT SIMILAR TO THE CONTROLLED TRANSACTIONS UNDER EXAMINATION SHOULD BE EXCLUDED FROM THE COMPARISON. FINALLY, WHEN PROFIT MARGINS OF AN INDEPENDENT ENTE RPRISE ARE USED, THE PROFITS ATTRIBUTABLE TO THE TRANSACTI ONS OF THE INDEPENDENT ENTERPRISE MUST NOT BE DISTORTED BY CON TROLLED TRANSACTIONS OF THAT ENTERPRISE.' 71A. THE ARGUMENTS OF SHRI RAJAN VORA THAT ENTITY LEVE L COMPARISON IS PERMITTED BOTH BY THE OECD COMMENTARY AS WELL AS BY THE COMMENTARIES BY EMINENT AUTHORS LIKE ROBERT T. COLE, J. HAROLD MC LURE AND OTHERS, IN OUR CONSI DERED OPINION IS NOT CORRECT. IN THE BOOK 'TRANSFER PRICI NG NOTE BOOK THIRD EDITION ROBERT T. COLE AT CHAPTER XXV WHAT IS SAID IS THAT THE REGULATOR SHOULD ALSO NOTE THAT SEGMENTATI ON OF TRANSACTION DOES NOT ALWAYS LEAD TO MORE RELIABLE R ESULTS AND THAT THE COMBINED EFFECT OF TWO OR MORE SEPARAT E TRANSACTIONS MAY BE CONSIDERED, IF SUCH TRANSACTION S ARE TAKEN AS A WHOLE AND ARE SO INTER-RELATED WITH CONS IDERATION OF MULTIPLE TRANSACTIONS, IS THE MOST RELIABLE MEAN S OF DETERMINING THE ARMS LENGTH CONSIDERATION OF THE TRANSACTIONS. AT PARAGRAPH 25.4 THE LEARNED AUTHOR STATES THAT OECD GUIDELINES MAY ALSO REQUIRE SOME SEGMENTA TION OF THE INTER- COMPANY TRANSACTIONS. THE ISSUE WHETH ER FURTHER DISAGGREGATION IS REQUIRED, DEPENDS ON PRAC TICAL ISSUES. SUCH COMMENTS CANNOT BE INTERPRETED AS PERM ITTING ENTITY LEVEL COMPARISON. SIMILARLY, TAXMANS BOOK O N 'LAW OF TRANSFER PRICING' BY D.P. MITTAL, SECOND EDITION PA RAGRAPH 7.9 HAS BEEN CITED AND THE BOOK 'US TRANSFER PRICE' BY ROBERT T. COLE PARAGRAPH 2.06 WAS RELIED UPON BY SH RI RAJAN VORA. ON A PERUSAL OF ALL THESE MATERIAL WE F IND THAT NONE OF THEM SUGGESTS ENTITY LEVEL COMPARISON. RELI ANCE WAS ALSO PLACED ON PARAGRAPH 1.20 OF 'TRANSFER PRICING GUIDELINES' OF OECD. FROM A PERUSAL OF THIS PARAGRA PH IT IS 14 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. CLEAR THAT THEY ARE APPLICABLE TO ALL METHODS, THAT MAY BE ADOPTED FOR ARRIVING AT THE ARMS LENGTH PRICE. THE LEARNED COUNSEL FOR THE ASSESSEE CANNOT RESTRICT PARA 1.20 TO THE METHOD OF TRANSACTIONAL NET MARGIN. THUS, THIS ARGU MENT CANNOT BE ACCEPTED. COMING TO THE DECISION RELIED U PON BY THE ASSESSEE IN THE CASE OF PHILIPS SOFTWARE CENTRE (P.) LTD. V. ASSTT. CIT [2008] 26 SOT 226 (BANG.), THE BANGALORE BENCH OF THE TRIBUNAL WAS CONSIDERING A CASE WHEREI N THE ASSESSEES BUSINESS WAS ONLY SOFTWARE DEVELOPMENT. SO THE COMPARABLE OF ANOTHER ASSESSEE ALSO ONLY IN SOFTWAR E DEVELOPMENT WAS CONSIDERED SUFFICIENT. THIS WAS A C ASE OF AGGREGATION OF SIMILAR TRANSACTIONS AND WHERE THE A SSESSEE HAD NO OTHER TRANSACTIONS. IN OUR CASE, 50 PER CENT OF THE ASSESSEES PRODUCTION IS FROM APIS IMPORTED FROM TH E AE AND WHEREAS THE BALANCE IS PRODUCTION FROM APIS WHI CH ARE NOT IMPORTED FROM AE. THERE IS ALSO TRADING ACTIVIT Y. THUS, WE ARE UNABLE TO ACCEPT THE CONTENTIONS OF SHRI RAJ AN VORA. 10.6. IN THE CASE ON HAND WHAT IS SOUGHT TO BE COM PARED IS, AVERAGE OF EXPENDITURE INCURRED IN ADVERTISING BY 17 PHARMA CO MPANIES, WITHOUT ANY ANALYSIS AS TO THE TYPE OF THE DRUG, THE NATURE OF MARKETS, THE PERIOD OF ADVERTISEMENT ETC., WHEN OVERALL PROFITABILITY IS C OMPARED, THE ASSESSEE HAS SHOWN GREATER PROFITABILITY MARGINS THAN THESE 17 P HARMA COMPANIES. EXPENDITURE INCURRED BY THE 17 COMPANIES ON OTHER H EADS SUCH AS SALARIES, RAW MATERIAL, ESTABLISHMENT ETC., ARE NOT COMPARED . THE NATURE OF PRODUCT ARE DIFFERENT. THE MARKETS ARE DIFFERENT. NOTHING COMMO N HAS BEEN BROUGHT-OUT. THIS IS NOT THE WAY THE TNMM IS TO BE APPLIED UND ER THE INCOME TAX ACT AND THE RULES FRAMED THEREIN. AT BEST WHAT CAN BE SAID IS THAT THE TPO HAS ADOPTED AN ADHOC METHOD TO DISALLOW CAPITAL EXPENSES UNDER THE GUISE OF TRANSFER PRICING PROVISION. 10.7. THE LEARNED DR SUBMITS THAT THE MOST IMPORTA NT ASPECT TO DETERMINE IS AS TO WHO SHOULD BEAR THE EXPENDITURE AND WHO IS GETTING THE BENEFIT OUT OF THIS MARKETING AND ADVERTISEMENT EXP ENDITURE. THE ASSESSEE IS THE MANUFACTURER OF THE PRODUCT AND AS RECORDED BY TPO AT PAGE 3, THE ASSESSEE IS SELLING PRODUCTS WHICH ARE HIGH IN DEMA ND AND CATER THE NICHE 15 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. MARKET. THE EXPENDITURE IS OF THE ASSESSEE. OFCOUR SE THE PRIMARY BENEFIT WOULD BE THAT OF THE ASSESSEE. IN ANY EVENT, IN OU R OPINION, THIS IS NOT THE PRIMARY ISSUE. THE PRIMARY ISSUE IS, WHETHER THE TP O HAS ARRIVED AT THE ARMS LENGTH PRICE IN ACCORDANCE WITH LAW ? THE ANSWER IS NO. COMING TO THE ISSUE WHETHER THE EXPENDITURE INCURRED IS GENUINE OR NOT, AS BROUGHT OUT IN INSTRUCTION NO. 3 DATED 20-5-2003, THE TPOS ROLE I S LIMITED TO THE DETERMINATION OF ARMS LENGTH PRICE IN RELATION TO T HE INTERNATIONAL TRANSACTIONS REFERRED TO HIM BY THE ASSESSING OFFICER AND IT IS THE ROLE OF THE ASSESSING OFFICER TO COMPUTE THE TOTAL INCOME OF THE ASSESSEE HAVING REGARD TO THE ARMS LENGTH PRICE. THE TPO HAS DOUBTED THE EXPENSES AND HAS ASKED THE A.O. TO INVESTIGATE. DESPITE THIS, THE ASSESSING OFFICER IN THIS CASE HAS NOT DOUBTED THE EXPENDITURE INCURRED. 10.8. COMING TO THE FINDINGS OF THE LEARNED CIT(A) , WE HOLD THAT THE FIRST APPELLATE AUTHORITY WAS WRONG IN BASING HIS DECISIO N ON THE FACT THAT RBI HAS GRANTED PERMISSION. THIS IS NOT A GROUND TO ALLOW A N APPEAL. EVERY REMITTANCE WOULD BEAR THE APPROVAL OF RBI. THE GROUND THAT THE TPO HAS NOT BROUGHT OUT ANY EVIDENCE ON RECORD THAT PART OF THE MONEY PAID TO AES WAS RETURNED BACK TO THE ASSESSEE IS ALSO NOT A BASIS CONTEMPLATED UN DER T.P. PROVISIONS. THE FACT THAT EXPENSES WERE AUDITED AND PAYMENTS WERE THROUG H BANKING CHANNELS ARE NOT ISSUES THAT DETERMINE THE TRANSFER PRICING ADJU STMENT. THESE ARE NOT GROUNDS ON WHICH A TRANSFER PRICING ADJUSTMENT COUL D BE DELETED. HENCE THE CIT (A) WAS WRONG ON BASIS IN HIS DECISION ON THESE FINDINGS. 10.9. NEVERTHELESS AS THE TPO HAS NOT GIVEN ANY RE ASON AS TO WHY THE METHOD ADOPTED BY THE ASSESSEE I.E., CUP METHOD IS NOT ACCEPTABLE AS THE MOST APPROPRIATE METHOD AND AS THE ASSESSING OFFICER HAS NOT ADOPTED ANY OF THE METHODS PRESCRIBED UNDER THE ACT AND HAS METHOD ADO PTED BY THE TPO CANNOT BE CALLED TNMM PRESCRIBED UNDER THE ACT AND RULES, WE HAVE TO NECESSARILY UPHOLD THE ORDER OF THE FIRST APPELLATE AUTHORITY, THOUGH FOR DIFFERENT REASONS. SIMILAR VIEW IS TAKEN BY THE PUNE BENCH IN 123 TTJ 657. 16 ITA.NO.5272/MUM/2007 GENOM BIOTECH PVT. LTD. 10.10. WE ALSO FIND THAT ON SIMILAR FACTS THE TRANS FER PRICING OFFICER FOR THE ASSESSMENT YEAR 2003-2004 VIDE ORDER DATED 9-3- 2006 UNDER SECTION 92CA(3) OF THE ACT HAS ACCEPTED THE METHOD ADOPTED BY THE ASSESSEE IN DETERMINING THE ARMS LENGTH PRICE FOR REIMBURSEMENT OF EXPENSES TO AES. WE ALSO POINTED OUT THAT THE FIGURES AND PERCENTAGES M ENTIONED IN THE GROUNDS OF APPEAL ARE WRONG AS RIGHTLY POINTED OUT BY THE LEAR NED SENIOR COUNSEL. THE PERCENTAGES ARE NOT 87.73% OR 60.33%. WE DO NOT GO INTO THESE CALCULATION AS IT WOULD BE AN ACADEMIC EXERCISE. 11. FOR ALL THESE REASONS, WE UPHOLD THE ORDER OF THE FIRST APPELLATE AUTHORITY AND DISMISS THIS APPEAL OF THE REVENUE. ORDER PRONOUNCED IN THE OPEN COURT ON 16-05-2012. SD/- SD/- (B.R.MITTAL) (J.SUDHAKAR REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATE 16 TH MAY, 2012 VBP/- COPY TO 1. ACIT - 10 (3), 451, AAYAKAR BHAVAN, 4 TH FLOOR, M.K. MARG, MUMBAI 400 020. 2. M/S. GENOM BIOTECH PVT. LTD., 9 TH FLOOR, 907, FILIX, COMMERCIAL COMPLEX, OPP. ASIAN PAINTS, L.B.S. MARG, BHANDUP, MUMBAI 400 078 PAN AABCG1013B 3. CIT(A) - ASSESSEE, MUMBAI 4. CIT, M.C.X, MUMBAI 5. DR L BENCH 6. GUARD FILE. (TRUE COPY) BY ORDER ASST. REGISTRAR, I.T.A.T. MUMBAI BENCHES MUMBAI.