CashEdge India Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 5365/DEL/2010

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69296 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 15-05-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 30-11-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SAMEER SHARMA
• Assessee Lawyers: MADHAVI SWAROOP; SACHIT JOLLYSH ROOHINA DUA
• Keywords: Depreciation; Transfer pricing; International transaction
• Section: 92C; 234B; 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH B: NEW DELHI) BEFORE SHRI U. B. S. BEDI, JUDICIAL MEMBER AND SHRI T. S. KAPOOR, ACCOUNTANT MEMBER ITA NO.5365/DEL/ 2010 (ASSESSMENT YEAR: 2006-07) CASH EDGE INDIA PVT. LTD. VS. ITO 30, NIZZAMUDDIN EAST. WARD 3(2) NEW DELHI. NEW DELHI. PAN: AACCC2816K (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. SACHIT JOLLY,SH. ROOHINA DUA, & MS. MADHAVI SWAROOP.ADV. REVENUE BY :SH. SAMEER SHARMA. SR, DR ORDER PER T. S. KAPOOR, AM THIS IS AN APPEAL FILED BY THE ASSESSEE WHICH IS DI RECTED AGAINST THE ORDER OF ASSESSING OFFICER DATED 28.10.2010 PASSED IN PURSUANCE OF DIRECTIONS OF DISPUTE RESOLUTION PANEL (DRP) U/S 14 4C(13) OF THE INCOME TAX ACT,1961. THE DISPUTE BEING CONTESTED IN THE AP PEAL IS REGARDING TRANSFER PRICING ADJUSTMENT ON ACCOUNT OF THE INTERNATIONAL TRANSACTION AND DEPRECIATION ON PERIPHERAL OF COMPUTER SYSTEMS. FAC TS IN BRIEF ARE THAT ASSESSEE DURING ASSESSMENT YEAR 2006-07 HAD ENTERED INTO AN INTERNATIONAL ITA NO.5365 /DEL/2010 2 TRANSACTION WITH ITS PARENT COMPANY IN THE U.S FOR WHICH IT HAS RECEIVED AN AMOUNT OF RS.7,25,28,815/-.SINCE THE ASSESSEE HAD E NTERED INTO AN INTERNATIONAL TRANSACTION WITH AN ASSOCIATE ENTERPR ISE, THE INCOME ARISING FROM SUCH TRANSACTION IN VIEW OF THE PROVISIONS OF SECTION 92C HAD TO BE COMPUTED HAVING REGARD TO ARMS LENGTH PRICE. SECTI ON 92CA PRESCRIBES VARIOUS METHODS SUCH AS COMPARABLE UNCONTROLLED PRI CING (CPU). RE-SALE PRICING METHOD, COST PLUS METHOD, PROFIT SPLIT METH OD AND TRANSACTIONAL NET MARGIN METHOD ETC. THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS REFERRED THE ISSUE OF DETERMINATION OF ARMS LENGTH PRICE TO THE TRANSFER PRICING OFFICER (TPO). THE TPO, THEREFORE, ISSUED NOTICE U/S 92C TO THE ASSESSEE ASKING THE ASSESSEE TO GIVE DETAILS OF TRANSFER PRICING STUDY CONDUCTED BY IT TO COMPUTE ARMS LENGTH PRICE OF TH E INTERNATIONAL TRANSACTION. THE ASSESSEE IN THE TRANSFER PRICING S TUDY SELECTED TNMM METHOD AS THE MOST APPROPRIATE METHOD FOR BENCHMARK ING THE INTERNATIONAL TRANSACTION WITH RESPECT TO UNCONTROLLED TRANSACTIO NS. THE ASSESSEE SELECTED 14 COMPARABLES AND USING 11 COMPARABLES FOR FINANCI AL YEAR 2003-04 AND 2004-05 ARRIVED AT A MEAN PLI OF 6.36%. THE ASSESSE E CHOSEN ITSELF AS THE TESTED PARTY AND CONTENDED THAT PLI EARNED BY ASSES SEE WAS AT 14.76% AND, THEREFORE, IT WAS SUBMITTED THAT TRANSACTION WITH A SSOCIATE ENTERPRISES WAS AT ARMS LENGTH PRICE. IN THE TPO ORDER THE TRANSFER P RICING OFFICER HAS DRAWN ITA NO.5365 /DEL/2010 3 AN ADVERSE INFERENCE WITH RESPECT TO THE SELECTION OF COMPARABLES AND, THEREFORE, HE SELECTED TWO COMPARABLES FOR COMPARIS ON OF MARGINS EARNED BY THEM VIZ-A-VIZ ASSESSEE. FOR DETERMINING THE ARMS LENGTH PRICE OF INTERNATIONAL TRANSFER PRICING, THE TRANSFER PRICIN G OFFICER HAD SELECTED THE FOLLOWING COMPARABLES: 1) BODHTREE CONSULTING LTD.. 2) SIP TECHNOLOGIES. THE MEAN OF MARGINS IN ABOVE TWO CASES WAS CALCULAT ED AT 23.64% AND WAS COMPARED WITH THE MARGIN DECLARED BY ASSESSEE IN IT S INTERNATIONAL TRANSACTION WHICH WAS 14.86% AND, THEREFORE, ADJUS TMENT TO THE EXTENT OF RS.5573934/- REPRESENTING DIFFERENCE OF 7.68% WAS M ADE TO THE INCOME OF ASSESSEE. 2. BESIDES MAKING ADDITION ON ACCOUNT OF DIFFERENCE IN ARMS LENGTH PRICE, THE ASSESSING OFFICER FURTHER DISALLOWED AN AMOUNT OF RS.1,96,290/- ON ACCOUNT OF DIFFERENCE IN DEPRECIATION OF COMPUTE R PERIPHERALS CLAIMED BY THE ASSESSEE. THE ASSESSEE HAD CLAIMED DEPRECIATION @ 60% WHEREAS ASSESSING OFFICER ALLOWED THE DEPRECIATION APPLICAB LE TO OFFICE EQUIPMENTS AND DISALLOWED THE REMAINING AMOUNT. 3. AGGRIEVED WITH THE ORDER, THE ASSESSEE IS IN APP EAL BEFORE US. THE ASSESSEE IN ITS APPEAL HAS EFFECTIVELY TAKEN THREE GROUNDS OF APPEAL AND EACH ITA NO.5365 /DEL/2010 4 GROUND HAS BEEN SUB-DIVIDED INTO FURTHER GROUNDS. THE FIRST EFFECTIVE GROUND OF APPEAL RELATES TO ADJUSTMENT OF RS.55,73,934/- T O THE INTERNATIONAL TRANSACTION ENTERED, THE SECOND RELATES TO DEPRECIA TION ON COMPUTER PERIPHERALS AND THIRD RELATES TO CHARGING OF INTERE ST U/S 234B. 4. THE LD. AR AT THE TIME OF HEARING SUBMITTED THAT HE WILL NOT BE PRESSING OTHER SUB-GROUPS RELATING TO GROUND NO.1 E XCEPT GROUND NO.1.17 WHICH RELATES TO WORKING CAPITAL ADJUSTMENT NOT ALL OWED BY THE ASSESSING OFFICER. THE LD. AR SUBMITTED THAT HE HAD NO OBJECT ION WITH REGARD TO REJECTION OF ITS COMPARABLES AND INCLUSION OF NEW C OMPARABLES AND HIS ONLY GRIEVANCE WAS THAT RISK ADJUSTMENT WITH RESPECT TO THE WORKING CAPITAL WAS NOT ALLOWED BY ASSESSING OFFICER. HE INVITED OUR AT TENTION TO ORDER OF TPO PLACED AT PAPER BOOK PAGE 192. THE LD. AR SUBMITTED THAT THE MEAN OF TWO COMPARABLES TAKEN BY TPO WAS 23.64% AND WHEREAS THE MARGIN OF THE ASSESSEE WAS DECLARED AT 14.81%. HE FURTHER SUBMITT ED THAT THE ASSESSEE WAS A RISK FREE ENTITY AS ALL ITS WORK ORDERS WERE FROM ITS PARENT COMPANY AND THE ORDERS WERE RECEIVED ALONG WITH ADVANCE PAYMENT AND THE WORKING CAPITAL REQUIREMENTS OF THE ASSESSEE COMPANY WERE DIFFERENT FROM THE WORKING CAPITAL REQUIREMENTS OF COMPARABLES. OUR ATTENTION WAS INVITED TO RULE 10B RELATING TO DETERMINATION OF ARMS LENGTH PRICE U/S 92C AND IT WAS SUBMITTED THAT ASSESSEE WAS COVERED BY SUB CLAUSE E OF RULE 1 0B AS IT HAD ADOPTED ITA NO.5365 /DEL/2010 5 TRANSACTION NET MARGIN METHOD. OUR ATTENTION WAS IN VITED TO SUB CLAUSE 3 OF CLAUSE C OF RULE 10B AND IT WAS SUBMITTED THAT THE NET PROFIT MARGIN EARNED BY COMPARABLES IN UNCONTROLLED TRANSACTIONS HAS TO BE ADJUSTED TO TAKE OUT EFFECT OF DIFFERENCE IN WORKING CAPITAL REQUIREMENT S OF COMPARABLES VIZ-A-VIZ ASSESSEE. OUR ATTENTION WAS INVITED TO PAGE 395 TO 396 OF PAPER BOOK WHEREIN A NOTE RELATING TO WORKING CAPITAL ADJUSTME NT REQUIREMENT TO BE MADE IN THE CASE OF ASSESSEE WAS PLACED. OUR ATTENT ION WAS ALSO INVITED TO PAGE 7 OF PAPER BOOK WHERE RELEVANT PAGE OF OECD TR ANSFER PRICING GUIDELINES WERE PLACED AND OUR SPECIFIC ATTENTION W AS INVITED TO PARA 1.45 TO PARA 1.47. RELYING UPON ABOVE GUIDELINES OF OECD, I T WAS ARGUED THAT ASSESSEE WAS WORKING IN A RISK FREE ATMOSPHERE AND WAS ALSO GETTING ADVANCE PAYMENTS. THEREFORE, RISK ADJUSTMENT AND WORKING CA PITAL ADJUSTMENT WAS NEEDED TO BE DONE TO ARRIVE AT COMPARABLE FIGURES. OUR ATTENTION WAS ALSO INVITED TO PAPER BOOK PAGE 398 TO HIGH LIGHT THAT R ATIO OF WORKING CAPITAL / CESS IN THE CASE OF ASSESSEE WAS 9.88% BECAUSE OF THE FACT THAT ASSESSEE USED TO RECEIVE ADVANCE PAYMENT AND, THEREFORE, WOR KING CAPITAL REQUIREMENTS WERE QUITE LESS AS COMPARED TO COMPARA BLES AND, THEREFORE, THE MARGIN EARNED BY ASSESSEE WAS LOWER THAN THE COMPAR ABLES. IT WAS CONTENDED THAT IF EFFECT OF WORKING CAPITAL ADJUSTM ENT IS GIVEN TO THE ASSESSEE, THE MARGIN DECLARED BY ASSESSEE WILL BE C OMPARABLE WITH THE ITA NO.5365 /DEL/2010 6 COMPARABLES. FURTHER IT WAS CONTENDED THAT SINCE AS SESSEE WAS CAPTIVE PROVIDER OF SERVICES TO ITS PARENT COMPANY, THERE W ERE FEW RISKS WITH RESPECT TO WORKING OF THE COMPANY AND, IF, NECESSARY RISK A DJUSTMENT IS GIVEN TO THE MARGIN OF COMPARABLES, THERE WAS NO NEED FOR MAKING ADDITION ON ACCOUNT OF ARMS LENGTH PRICE. 5. RELIANCE IN THIS RESPECT WAS PLACED ON THE CASE LAW IN ITA NO.7861 IN THE CASE OF CAPGEMINI INDIA PVT. LTD. DECIDED BY MU MBAI BENCH OF TRIBUNAL. OUR SPECIFIC ATTENTION WAS INVITED TO PAR A 2.7 AT PAGE 282 AND FURTHER FINDINGS OF TRIBUNAL AT PAGE 308 AT PARA 6. SIMILARLY RELIANCE WAS PLACED ON THE CASE OF DEMAG CRANES AND COMPONENTS INDIA (PVT.) LTD. VS. DCIT REPORTED IN 144 TTJ 320 AND WE WERE TAKEN TO P APER BOOK PAGE 323 WHEREIN RELEVANT FINDINGS OF THE TRIBUNAL WERE PLAC ED. 6. RELIANCE WAS ALSO PLACED ON THE FOLLOWING CASE L AWS: 1) MENTOR GRAPHICS (NOIDA) (PVT.) LTD. VS. DCIT REP ORTED IN 109 ITD 101. IN VIEW OF THE ABOVE JUDICIAL PRONOUNCEMENTS IT WAS CONTENDED THAT ADJUSTMENT ON ACCOUNT OF WORKING CAPITAL WAS NECESS ARY TO MAKE THE RESULS OF COMPARABLES MORE COMPARABLES WITH THE ASSESSEE C OMPANY. CONTINUING HIS ARGUMENTS HE SUBMITTED THAT IN THE ASSESSMENT Y EAR 2007-08 THERE WAS NO ADDITION ON ACCOUNT OF ARMS LENGTH PRICE BECAUSE T HE DIFFERENCE WAS ITA NO.5365 /DEL/2010 7 BETWEEN + ,- 5%. IT WAS FURTHER CONTENDED THAT IN A SSESSMENT YEAR 2008-09, THE ASSESSING OFFICER HIMSELF GAVE THE ADJUSTMENT O N ACCOUNT OF WORKING CAPITAL. IT WAS FURTHER CONTENDED THAT ASSESSEE DID NOT HAVE ANY RISK AS ITS RETURNS AND ORDERS WERE ASSURE AND, THEREFORE, ASSE SSEE WAS ELIGIBLE FOR RISK ADJUSTMENT ALSO. 7. RELIANCE IN THIS RESPECT WAS PLACED ON THE FOLLO WING CASE LAWS: 1) M/S INTELLINET TECHNOLOGIES INDIA PVT. LTD. VS. ITO REPORTED IN ITA NO.1237 (BANG.)/ 2010 DECIDED BY A BENCH OF B ANGALORE OF TRIBUNAL. 2) DCIT VS. M/S HELLOSOFT INDIA PVT. LTD. REPORTED IN ITA NO.645/HYD/2009 DECIDED BY HYDERABAD BENCH OF TRIBU NAL. 8. RELYING UPON SECOND GROUND, IT WAS CONTENDED THA T IT WAS A COVERED MATTER BY THE DECISIONS OF CIT VS. BSES RAJDHANI PO WERS LTD. REPORTED IN ITA NO. 1266/2010 AND DCIT VS. DATACRAFT INDIA LTD. REPORTED IN 133 TTJ (MUMBAI) (SB) 377 AND IT WAS CONTENDED THAT THE CLA IM OF ASSESSEE FOR DEPRECIATION ON COMPUTER PERIPHERALS AS PER VARIOUS COURTS DECISIONS WAS CORRECT AND ASSESSEE WAS ELIGIBLE FOR DEPRECIATION @ 60% ON SUCH PERIPHERALS. 9. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAND SUBMITTED THAT ASSESSEE IS FULLY DEPENDANT ON ITS AE AND, THEREFOR E, WAS EXPOSED TO A GREATER RISK THAN A NORMAL ENTERPRISE AS THE ASSESS EE HAD WORK FOR ONLY FROM ITA NO.5365 /DEL/2010 8 ONE CLIENT THAT IS ITS PARENT HOLDING COMPANY AND, THEREFORE, WHATEVER RISK ITS HOLDING COMPANY WAS TAKING WERE ALSO FULLY APPLICAB LE TO THE ASSESSEE COMPANY. CONTINUING HIS ARGUMENTS THE LD. DEPARTMEN TAL REPRESENTATIVE SUBMITTED THAT THERE WERE DIFFERENT RISK ON ACCOUNT OF HUMAN ERROR, SOCIAL RISK ETC. AND WHEN BUSINESS IS DIVERSIFIED AND BUSI NESS IS OBTAINED FROM VARIOUS CLIENTS RISK IS REDUCED COMPARABLY AS THERE ARE MORE CLIENTS SO FAILURE OR NON OBTAINING OF WORK FROM ONE OR TWO MAY NOT SI GNIFICANTLY ALTER THE PROSPECTS OF A COMPANY. THEREFORE, HE CONTENDED THA T IN HIS OPINION THE ASSESSEE WAS MORE PRONE TO RISK AND, THEREFORE, REQ UIRED A RISK ADJUSTMENT ON THE OPPOSITE SIDE. HIGHLIGHTING FROM RULE 10 THE LD . DEPARTMENTAL REPRESENTATIVE CONTENDED THAT IF THERE WERE SUBSTAN TIAL DIFFERENCES THEN ONLY ADJUSTMENT HAS TO BE DONE OTHERWISE +, - 5% AS PROV IDED IN THE ACT TAKES CARE OF THE SMALL DIFFERENCES. HE FURTHER ARGUED TH AT NO WORKING CAPITAL ADJUSTMENT WAS REQUIRED IN THE CASE OF ASSESSEE. FU RTHER IT WAS CONTENDED THAT IF AT ALL WORKING CAPITAL ADJUSTMENT WAS NEEDE D AND ADVANCES RECEIVED BY ASSESSEE WERE NOT FROM INDIAN BANKS BUT WAS OBTA INED FROM CHEAPER SOURCES FROM OUTSIDE INDIA THEREFORE, INDIAN PLR SH OULD NOT BE USED TO ASCERTAIN INTEREST RATES FOR CALCULATION OF WORKING CAPITAL ADJUSTMENT. 10. RELIANCE IN THIS RESPECT WAS PLACED ON THE FOLL OWING CASE LAWS: 1) GE INDIA TECHNOLOGY CENTRE (PVT.) LTD. (BANGALOR E) VS. DCIT REPORTED IN ITA NO.789 ITA NO.5365 /DEL/2010 9 2) ST MICROELECTRONICS (PVT.) LTD. VS. CIT REPORTED IN ITA NOS. 1806 & 1807. 3) DCIT HYDERABAD VS. DELLOITE CONSULTING INDIA (PV T.) LTD. REPORTED IN ITA NO.1082. 4) INTERRA INFORMATION TECHNOLOGIES VS. DCIT REPORT ED IN ITA NO.5568. 5) WILLS PROCESSING SERVICES INDIA VS. DCIT MUMBAI REPORTED IN ITA 8772. IN VIEW OF THE ABOVE JUDGMENTS THE LD. DEPARTMENT AL REPRESENTATIVE SUBMITTED THAT ADJUSTMENT CANNOT BE GIVEN FOR RISKS ASSUMED BY ASSESSEE VIZ- A-VIZ ITS COMPARABLE. 11. THE LD. AR IN HIS REJOINDER SUBMITTED THAT ASS ESSEE WAS AN INDIAN COMPANY SO THEREFORE ONLY INDIAN PLR CAN BE USED. A S REGARDS THE CONTENTION OF LD. DEPARTMENTAL REPRESENTATIVE THAT +, -5% AS PROVIDED IN THE ACT WAS SUFFICIENT TO TAKE CARE OF DIFFERENCE I N COMPARABLES THE LD. AR SUBMITTED THAT IT WAS NOT CORRECT AS THERE IS RULE 10B WHICH PROVIDES FOR ELIMINATION OF DIFFERENCES IN COMPARABLES AND ARGUE D THAT INTERPRETATION WHICH RENDERS THE RULES REDUNDANT SHOULD NOT BE TAK EN. 12. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE T HROUGH THE MATERIAL PLACED ON RECORD. GROUND NO.1.17 RELATES TO THE GRI EVANCE OF ASSESSEE WITH REGARD TO NON- GRANTING OF ADJUSTMENT ON ACCOUNT OF DIFFERENCE IN WORKING CAPITAL REQUIREMENTS AND RISK ASSUMED BY APPELLANT VIZ-A-VIZ COMPARABLE COMPANIES. AS REGARDS THE ADJUSTMENT ON ACCOUNT OF DIFFERENCE IN WORKING CAPITAL REQUIREMENT, WE ARE OF THE OPINION THAT MOR E ACCOUNT RECEIVABLE IN ITA NO.5365 /DEL/2010 10 CASE OF A COMPANY WOULD MEAN RELATIVELY LOWER PROFI TS. THEREFORE, THE COMPANIES COULD BE CONSIDERED FULLY COMPARABLE IF T HEY HOLD THE SAME LEVEL OF ACCOUNT RECEIVABLE AND ACCOUNT PAYABLE. RULE 10( 2) (D) ALSO PROVIDES THAT THE COMPARABILITY HAS TO BE JUDGED WITH RESPECT TO VARIOUS FACTORS INCLUDING THE MARKET CONDITIONS, GEOGRAPHICAL CONDITIONS, COS T OF LABOUR AND CAPITAL IN THE MARKET. ACCOUNTS RECEIVABLE/ PAYABLE EFFECT TH E COST OF WORKING CAPITAL. A COMPANY WHICH HAS A SUBSTANTIAL AMOUNT BLOCKED WI TH THE DEBTORS FOR A LONG PERIOD CANNOT BE FULLY COMPARABLE TO THE CASE WHICH IS ABLE TO RECOVER THE DEBT PROMPTLY. THE PLEA OF THE AR THAT THE ASSE SSEE HAS BEEN RECEIVING ADVANCE PAYMENTS AS COMPARED TO ITS COMPARABLES. WH ICH WERE HAVING SUNDRY DEBTORS DESERVES MERITS IN VIEW OF THE FACT S AND CIRCUMSTANCES OF THE PRESENT CASE AND, THEREFORE WORKING CAPITAL ADJUSTM ENT SHOULD HAVE BEEN GIVEN TO THE ASSESSEE. 13. MOREOVER, IT IS OBSERVED THAT ASSESSING OFFICER HIMSELF HAD GIVEN WORKING CAPITAL ADJUSTMENT IN THE CASE OF ASSESSEE ITSELF IN THE ASSESSMENT YEAR 2008-09. THEREFORE, KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AND ON THE BASIS OF VARIOUS JUDICIAL P RONOUNCEMENTS RELIED UPON BY ASSESSEE WE ARE OF THE CONSIDERED OPINION THAT A PPROPRIATE WORKING CAPITAL ADJUSTMENT WAS REQUIRED TO BE MADE BEFORE M AKING THE MARGINS ITA NO.5365 /DEL/2010 11 COMPARABLE WITH THE MARGINS OF COMPARABLES. THEREFO RE, ASSESSING OFFICER IS DIRECTED TO GIVE APPROPRIATE ADJUSTMENT IN THIS RESPECT. 14. AS REGARDS PLEA OF THE LD. AR FOR GIVING ADJUST MENT ON ACCOUNT OF IT BEING A RISK FREE ENTITY, WE ARE OF THE CONSIDERED OPINION THAT COMPANIES CONDUCTING BUSINESS WILL HAVE THE SAME RISK THAT IS CUSTOMER RISK, GOVT. POLICY RISK ETC. THERE MAY BE VARIOUS KINDS OF RISK S ASSOCIATED WITH CONDUCTING BUSINESS. UNLESS THE RISK IS QUANTIFIED IN A CERTAIN OBJECTIVE MANNER AND CAN BE REPRESENTED BY WAY OF NUMBERS, IT IS VERY DIFFICULT TO MAKE ADJUSTMENT ON PREMISES AND CONJECTURES. UNLESS THE RISK ADJUSTMENT IS QUANTIFIED IN A SCIENTIFIC MANNER THE RISK ADJUSTME NT CANNOT BE GIVEN. IN FACT IT IS A DUTY OF ASSESSEE AS WELL AS TPO TO CONDUCT A PROPER FAR ANALYSIS SO THAT RIGHT COMPARABLES ARE SELECTED. ONCE THE COMPA RABLES ARE SELECTED AND ACCEPTED EXCEPT FOR WORKING CAPITAL ADJUSTMENT NO F URTHER RISK ADJUSTMENT IS REQUIRED TO BE MADE. IN VIEW OF THIS WE DO NOT AGR EE WITH ASSESSEES CONTENTIONS SO FAR AS RISK ADJUSTMENT IS CONCERNED. IN VIEW OF THE ABOVE, GROUND NO.1 IS PARTLY ALLOW ED. 15. AS REGARDS DEPRECIATION ON COMPUTER PERIPHERALS THE CASE OF THE ASSESSEE IS FULLY COVERED BY THE DECISION IN THE CA SE OF CIT VS. BSES RAJDHANI POWERS LTD. REPORTED IN ITA NO. 1266/2010 WHEREIN IT HAS BEEN HELD THAT COMPUTER PERIPHERALS ARE ELIGIBLE FOR DEP RECIATION @ 60% ITA NO.5365 /DEL/2010 12 THEREFORE, GROUND NO.2 IS ALLOWED. GROUND NO.3 WIT H RESPECT TO INTEREST U/S 234B IS CONSEQUENTIAL AND DOES NOT REQUIRE ANY ADJU DICATION. IN VIEW OF THE ABOVE, THE APPEAL FILED BY ASSESSE E IS PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 27 TH /09/ 2013 SD/- SD/- (U. B. S. BEDI) (T.S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 27 TH DAY OF SEPTEMBER, 2013 S.SINHA COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. CIT(ITAT), NEW DELHI. AR,ITAT NEW DELHI.