Microsoft India (R&D) Private Limited, New Delhi V. NeAC, New Delhi

ITA 602/DEL/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 3469 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: I
• Assessment Year: 2016-2017
• Appeal Filed On: 26-05-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MAHESH SHAH
• Keywords: Related party transaction; Depreciation; Transfer pricing; International transaction; Question of law
• Section: 56; 143(3); 56(2); 234B; 144C; 139(1); 22

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “I”: NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA No.602/Del/2021 Assessment Year: 2016-17 O R D E R PER SHAMIM YAHYA, ACCOUNTANT MEMBER This appeal by the assessee is directed against the order of the Assessing Officer dated 30.03.2021 passed under section 143(3) r.w.s. 144C(13) r.w.s. 144C(13)/143(3A)/143(3B) of the Income-tax Act, 1961 (for short ‘the Act’) pursuant to the directions of the Dispute Resolution Panel (DRP). Microsoft India (R&D) Private Limited, 807, New Delhi House, Barakhamba Road, New Delhi-110 001 PAN AABCM6358F Vs. National e-Assessment Centre, Delhi. (Appellant) (Respondent) Assessee by: Shri Nageshwar Rao, Advocate Ms. Deepika Aggarwal, Advocate Department by: Shri Mahesh Shah, CIT (DR) Date of Hearing: 08.08.2022 Date of pronouncement 25.08.2022 2 ITA No.602/Del/2021 2. The assessee has taken the following grounds of the appeal before the Tribunal:- “1. Orders passed by Transfer Pricing Officer-2(2)(2) (‘Ld. TPO'), draft assessment order passed by Assistant Commissioner of Income Tax, Special Range 6, New Delhi and final assessment order passed pursuant to directions of Dispute Resolution Panel ('Hon'ble DRP') by Additional/Joint / Deputy / Assistant Commissioner of Income Tax/ Income-tax Officer, National e-Assessment Centre, Delhi ('Ld. AO') are bad in law. 2. Ld. AO has erred on facts and in law in determining total income of the Appellant at INR 7,218,234,160 as against a returned income of INR 5,526,284,370. Part I - Transfer Pricing Matters 3. That on facts and in law, Hon'ble DRP and the Ld. TPO/ Ld. AO erred in making an adjustment of INR 1,569,263,482 to returned income of the Appellant in respect of international transaction pertaining to contract software development services ('SWD' or 'Impugned Transaction') 4. Transfer pricing adjustments made to the Impugned Transaction by Ld. AO based on order of Ld. TPO giving effect to the directions issued by Hon'ble DRP is bad in law inter-alia as the Appellant's AE was being charged to tax at a higher rate in the US and there was no advantage of shifting of any profit from a low tax paying country to a high tax paying country. 5. That on facts, Ld. AO/ Ld. TPO erred in providing full effect to the directions issued by Hon'ble DRP in relation to computation of operating margin of tested party and thus did not consider the revised operation margin of SWD segment while determining Transfer Pricing adjustment for Impugned Transaction. 6. That on facts and in law, Hon'ble DRP and Ld. TPO/ Ld. AO have erred by not appreciating the correct functional profile of Appellant for Impugned Transaction and further erred in drawing erroneous conclusion that Appellant is engaged in providing high-end software development services. 7. That on facts and in law, Hon'ble DRP and Ld. TPO/ Ld. AO have erred by not accepting economic analysis undertaken by the Appellant in accordance with the provisions of the Income - tax Act, 1961 ('the Act') read with the Income - tax Rules, 1962 ('IT Rules/Rules') in toto, and purportedly modifying the economic analysis to reach erroneous conclusion that Impugned Transaction is not at arm's length. 8. Ld. TPO/ Hon'ble DRPI Ld.AO erred in routinely following their A Y 2012-13 and / or A Y 2014-15 orders disregarding favorable and material difference in facts and law considered in contrast to earlier years. 9. That on facts and in law, Hon'ble DRP and Ld. TPOI Ld. AO erred in rejecting certain comparables by applying arbitrary filters such as : 3 ITA No.602/Del/2021 a. Rejection of comparable companies having turnover less than INR 1,115 crores i.e. 50 percent of Appellant's turnover from software development services; b. Rejection of companies having different financial year ending (i.e. not 31 March 2016) or if data of the company do not fall within 12 month period i.e. 01- 04-2015 to 31-03-2016. Without prejudice to the other arguments, the Hon'ble DRP and the Ld. TPO/Ld. AO have also ignored the fact that financial data for several companies for the year ended 31 March 2016 is available in public domain, c. Rejection of companies having export sales less than 75% of the sales; d. Rejection of companies having employee cost less than 25% of the operating cost; e. Selection of only those companies which have generated patents in USA or in India in the field of software R&D for Impugned Transaction; f. Rejection of companies which have diminishing revenue for last three years upto and including FY 2015-16; and g. Inappropriate and inconsistent application of filter to reject the companies which have incurred persistent losses for last 3 years including FY 2015-16. 10. Hon'ble DRP and Ld. TPO/Ld. AO erred in facts and in law, by wrongfully rejecting certain functionally comparable companies and adding certain non-functionally comparable companies to the final set of comparable, on ad-hoc basis. They have resorted to cherry picking of comparable companies to determine ALP for the Impugned Transaction. 11. Hon'ble DRP and the Ld. TPO/ Ld. AO erred in law and in facts by selecting certain companies which are earning super normal profits, as being comparable to the Appellant. 12. That on facts and in law, Hon'ble DRP and Ld. TPO/Ld. AO have grossly erred in incorrectly treating foreign exchange fluctuation as non-operating while computing operating profit of comparable companies and tested party. 13. That on facts and in law, Hon'ble DRP and the Ld. TPO/Ld. AO have grossly erred by not appreciating the fact that Appellant operates as a risk free service provider and all the risks associated with the Impugned Transaction was borne by the foreign AE and not by the Appellant, thus, the Appellant is entitled to suitable adjustments to account for differences in its risk profile vis-a-vis the comparables and if for any reason such adjustments cannot be made, such companies cannot be considered eligible to be comparable in first place. 14. Hon'ble DRP has erred in confirming that the Ld. TPO has discharged his statutory onus to establish that the conditions specified in clause (a) to (d) of Section 92C(3) of the Act have been satisfied before disregarding the ALP determined by the Appellant and proceeded to determine the ALP himself. Part II - Corporate tax matters 4 ITA No.602/Del/2021 15. That on the facts and in law, the Ld. AO and the Hon'ble DRP was not justified and have erred by taxing gross composite rental income of Rs. 23,67,03,600 received from let out building space along with inbuilt infrastructure, plant & machinery and other amenities under the head 'Income from House Property' instead of 'Income from Other Sources' completely disregarding the provisions of Section 56 of the Act and decisions of Hon'ble Jurisdictional High Court. a. That on the facts and in law, the Ld. AO and Ld. DRP erred in not allowing proportionate tax depreciation and expenses under section ('u/s') 57 of the Act amounting to Rs.19,45,43,488. b. That on the facts and in law, the Ld. AO and Ld. DRP erred in applying res judicata which is not applicable in income tax proceedings and erred in not correcting mistakes made in earlier years, disregarding the directions of Hon'ble ITAT for AY 2012-13 i.e., without considering the judgement of Asit C Mehta (2006) 10 SOT 306 (Mum ITAT). c. That on the facts and in law, the Ld. AO and Ld. DRP erred in not finally deciding the characterisation of composite rental income considering the judgement of jurisdictional High Court in the case of Jay Metal Industries (P) Ltd. vs CIT (2017) 396 ITR 194 (Del). 16. That on the facts and in law, the Ld. AO was not justified and has erred in not granting tax deducted at source to the extent of Rs.1,69,948. 17. That on the facts and in law, the Ld AO erred in levying interest u/s 234A of the Act without considering the fact, that return of income for relevant assessment year has been furnished within due date as specified u/s 139(1) of the Act. 18. That on the facts and in law, on disposal of this appeal, material adjustment would be required in computing total income, tax, interest u/s 234B of the Act. Necessary directions may please be given to the Ld. AO in this regard. 19. That on the facts and in the circumstances of the case and in law, the Ld. AO has erred in initiating penalty u/s 271 (1)(c) of the Act.” 3. The assessee is a Private Limited Company engaged in the business of software development and product support services. It filed its return for AY 2016-17 on 29.11.2016 declaring total income of Rs.5,53,01,09.910/- which was subsequently revised to Rs.5,52,62,84,370/- on 26.03.2018. The case was selected for scrutiny under CASS. The Ld. AO completed the assessment under section 143(3) r.w.s 144C of the Act on 30.03.2021 on total income of Rs.7,21,82,34,156/- including therein addition of Rs.1,56,92,63,482/- on 5 ITA No.602/Del/2021 account of transfer pricing adjustments and Rs.12,26,86,304/- on account of difference of rental income offered as other sources. 4. Aggrieved, the assessee filed appeal before the Tribunal and all the grounds of appeal relate to the above mentioned addition to the income returned. 5. We have heard the Ld. Representatives of the parties, considered their submission and perused the material available on record. 6. Ld. Counsel of the assessee submitted that identical issue was considered by this Tribunal in assessee’s own case earlier in ITA No.5027/Del/2017 for AY 2013-14 vide order dated 11.08.2022. Both the ld. counsels agreed that order in the said case may be followed by this Bench as their arguments remain the same. 7. Grounds No.1 and 2 are of general nature not requiring adjudication. 8. As regards ground nos.3 to 14 which relate to transfer pricing adjustment, ld. counsel of the assessee submitted that the issue has been settled under Mutual Agreement Procedure (MAP) in an application filed by its Associated Enterprises (AE), namely, Microsoft Corporation before USA Competent Authority. Ld. counsel of the assessee sought to withdraw these grounds. Ld. DR for the Revenue had no objection. Accordingly, we permit withdrawal of grounds no.3 to 14 and these grounds are dismissed as not pressed. 9. Apropos issue of corporate tax matter, the AO asked the assessee as to why income from house property has been shown as taxable under the head ‘income from other sources’ and should not be considered as ‘income from house property’. AO reproduced the assessee’s submissions and thereafter found that the facts are similar as in earlier years. He proceeded to reject the assessee’s submission and concluded as under :- “5.4 In view of the above facts, the claim of deduction of the above amount is rejected. Addition of Rs.12,26,86,304/- i.e. being the difference of income determined as ‘income from house property’ and income claimed as ‘income from other sources’ (Rs.16,48,46,416/- Rs.4,21,60,112_ as computed below is being made to the computation of income.” 6 ITA No.602/Del/2021 10. On this issue, ld. counsel of the assessee submitted that in assessee’s case for earlier years, identical issue was decided in favour of the assessee. However, ld. DR for the Revenue sought to distinguish the order relied upon by the assessee. These submissions were already made by the ld. DR in the aforesaid appeal for AY 2013-14 and before us, ld. DR submitted that his submissions will be the same. 11. We note that ITAT had decided the issue in the appeal for AY 2013-14 (supra) as under :- “9. The Ld. AR submitted that the issue is covered in favour of the assessee by the order of the Tribunal in the assessee’s own case for AY 2011-12 and 2012-13. Whereas the Ld. DR took lot of pains and in his written submission filed before us attempted to prove that the facts in the case of Sultan Brothers Pvt. Ltd. (supra) and in Jay Metals Industries Pvt. Ltd. 84 taxmann.com 11 (Delhi High Court) are different from the facts in assessee’s case on following points:- “6. Submission distinguishing Sultan Brothers P Ltd and Jay Metals Industries P Ltd being on different facts- 1) The provisions of the section 56(2) are also being reproduced as under- "56 (2) in particular, and without prejudice to the generality of the provisions of sub- section (1), the following incomes, shall be chargeable to income-tax under the head "Income from other sources", namely:- ...................................................................................................... ...................................................................................................... (iii) where an assessee lets on hire machinery, plant or furniture belonging to him and also buildings, and the letting of the buildings is inseparable from the letting of the said machinery, plant or furniture, the income from such letting, if it is not chargeable to income-tax under the head "Profits and gains of business or profession.” 2) In the present case which is before Hon'ble Bench, in the lease deed of the assessee company i.e. Microsoft India Pvt. Ltd with its associated enterprises i.e. M/s Global Service Centre India Pvt. Ltd, it is stated that the assessee company has let out the "Building" along with the infrastructure facilities which includes Centralised Air Conditioning, DG Power supply and other electrical equipments which forms the part of the building and are necessary for the proper functioning of the said 'Building'. It is respectfully submitted that the facts in the case of Sultan Brothers Pvt. Ltd in & in Jay 7 ITA No.602/Del/2021 Metal Industries Pvt. Ltd. are different from Microsoft India (R&D) Pvt. Ltd. on following points:- Facts in the case of Sultan Brothers Pvt. Ltd. (SC) ‘Annexure B’ Facts in M/s Microsoft India (R&D) Pvt. Ltd. Facts in the case of Metal Industries Pvt. Ltd. (Delhi HC) ‘Annexure C’ • At page 9, the Hon'ble Supreme Court has referred to lease deed as- • "We will now refer to the provisions in the lease to see whether the parties intended that the furniture, fixtures and t h e building shall all be enjoyed tighter. Clause 1 of The lessee's covenant, in our opinion, puts the matter beyond doubt and it is as follows:- • (a) To use the demised premises and the said furniture and fixtures for the purpose of running hotel, barding and the lodging house, restaurant, confectionary and such other ancillary business in the said premises such as providing show-cases show windows, newspapers stall, dancing and other exhibition of arts, meeting rooms etc., and not for any other purpose without the previous permission in writing of the Lessors. • It is clear from this • The relevant clauses at page 5 para 1 of the lease deed in the present case under appeal before ITAT are reproduced below- • "3.4 The Lessor shall provide adequate power load to the LESSEE to run its commercial operations smoothly without any hindrance from the LEASED PREMISES. The LESSOR has agreed to provide at the LEASED PREMISES electricity and power load of not less than 1 KW/SFT for the exclusive use of the LESSEE. The LESSOR shall provide to the le LESSEE additional/new electricity and power load in future as may be required by the LESSEE. Any payment which may be required to be made to the electricity board or authorities or any other agency for the additional/new electricity and power load to bring it to the LESSEE'S desired requirements shall be paid by the LESSOR." • At page 6 para 3- • "3.7.4 In the event the • The Hon'ble High Court has stated at page 2 para 3- • Certain other clauses of the lease deed relevant to the present case read thus: • "2(c) The Lessor shall provide a sanctioned load of 210 KVA electricity connection through an independent transformer installed at the premises. The Lessee agrees to pay directly to the concerned department all charges for electricity and water consumed by the lessee in the premises. The electricity charges will be based on the consumption shown by the meter on the basis of the bill received from Haryana Electricity Board. The water charges will be paid by the Lessee on the basis of the bill received from Haryana Water Authority. Both Electricity and water charges will be paid by the lessee directly to the departments on the basis of Bills 8 ITA No.602/Del/2021 clause that the building and the fixtures and furniture were to be used for one purpose, namely, for the purpose of running a hotel with them all tighter. Again cl.1 1(h) of the lessee's covenant provided that the lessee is not to remove any article of thing from the premises except for the purposes of and in the course of the hotel business which latter would be for effecting repairs to them or for replacing them where it was the duty of the lessee to do so under the lease. We think, therefore, that the lease clearly establishes that it was the intention of the parties to it that the furniture and fixture and the building should be enjoyed all tighter and not one separately from the other." services mentioned in this clause 3.7 are not provided by the LESSOR to the satisfaction of the LESSEE, the LESSEE shall be entitled to avail the same from other sources and deduct the amount from the Rent payable by it to the LESSOR. Rent Additionally, in the event the LESSSEE is not satisfied from the 100% power back provided by the LESSOR, the LESSEE shall be entitled to install such Diesel Generator Sets and of such capacity as it may require in the BUILDING for exclusive use of the LESSEE. It is clarified that the LESSOR shall, without any extra cost provide appropriate and suitable space to the LESSEE in the BUILLDING for the aforesaid The LESSEE shall be entitle to deduct the cost and expenses incurred by the it for installation of the Diesel Generator Sets and cost of running and maintaining the same from the Rent payable by the LESSEE to the LESSOR. In the event the LESSEE Could not procure air conditioning and 100% power back- up from third parties, the without any extra received from time to time." • "2(d) The Lessor shall hand over the office with furniture & fixture 200 KVA diesel generator and adequate air conditioners to the Lessee in good working condition. The Lessee agrees to pay directly all charges towards maintenance of the premises including comprehensive maintenance of Generator. Air conditioner and other fixture and findings as per Annexure ’A'." • At page 7 para 2- • However, in the present case, as already discussed, it is plain that letting is not merely of the building but a composite letting of both, the building as well as the equipment, furniture etc. and thereby Section 56 (2) (Hi) of the Act was attracted. Applying the test laid down in Sultan Bros, (supra) the income from the letting in the hands of the Assessee was "a new kind of income" which could be considered to be income from house property since the income not from the 9 ITA No.602/Del/2021 LESSEE shall be entitled to terminate this Lease Deed." ownership of the building alone "but an income which though arising from a building would not have arisen if the plant, machinery and furniture had not also been let along with it". 7. In view of the above, it is submitted that the judgment of the Hon'ble Supreme Court in the case of Sultan Brothers and the judgment of Hon'ble High Court in the case of Jay metals Industries Ltd cannot be relied upon in the present case as the facts in this case i.e M/s Microsoft India Pvt. Ltd are different. Moreover, from the conjoint reading of Para 3.4 (Pg5) and Para 3.7.4 of lease deed in M/s Microsoft India (R&D) Pvt. Ltd (Pg 6 it is apparent that the lessor is required to provide the Services in form of (electricity, Air Conditioning, Power Backup etc.) to the lessee for which the infrastructure such as (Central Air Conditioning with ducting, DG Power Supply, Network equipments, Occupancy Sensors, VAV's & Controllers, Smoke Detectors, Access Control Equipment, Electrical Equipments) are setup. It is the providing of services which is agreed upon as per lease deed. This inference flows out from Para 3.7.4 explicitly which mentions that if lessee is not satisfied with the services provided, then lessee is entitled to bring in his own infrastructure and lessee is entitled to deduct the cost and expenses from the rent payable. Moreover, at Para 7.7 of lease deed in M/s Microsoft India (R&D) Pvt. Ltd it is explicitly mentioned that on interruption of services, Lessee has the option to:- (1) Abatement of Rent. (2) Termination of lease deed. it is clear that the price of services is inbuilt in the rent, and in event of the services not provided, unsatisfactory and lessee bringing in own infrastructure in form of DG generator set, netting of such incurred cost with Rent is permitted in lease deed, which clearly shows that the rent is not composite as envisaged in the section 56(2) of the Act. The assessee company Microsoft India (R&D) Pvt. Ltd has leased out 'Building' along with infrastructure for providing certain services which can also be sourced by lessee in case of inadequacy. Thereby, the condition of the section 56(2) of the Income Tax Act is not satisfied. In the case of Sultan Brothers and Jay Metals Industries Ltd, the furniture and fixtures was composite with building rent as inseparable component. To that extent the facts of Sultan Brothers (P) Ltd and Jay Metal Industries P Ltd are different and ratio is inapplicable to Microsoft India (R&D) Ltd in the A.Y. 2013-14.” The emphasis of the Ld. DR is that the rent is not composite as envisaged in section 56(2) of the Act. 10 ITA No.602/Del/2021 10. We have carefully considered the rival submissions of the parties and perused the material available in the records. It is not in dispute that in preceding years the assessee has been claiming that the rental income earned by it from let out building space along with inbuilt infrastructure and other amenities is taxable as income from other sources and not as income from house property. The Revenue has been rejecting the assessee’s claim on the flimsy ground that claim has not been made in the returns but the claim is made during the course of assessment proceedings. With a view to satisfy the Revenue and to overcome the above disability, the assessee after having filed the original return for AY 2013-14 filed revised return claiming therein that the rental income is assessable under the head ‘income from other sources’. Adopting the reasons given in earlier years, analyzing the nature of lease agreement, holding that the assessee is not receiving composite rent as recommended by the Hon’ble Supreme Court in Sultan Brothers Pvt. Ltd. (supra) and that the lease deed is between related parties, the Ld. AO made the impugned disallowance which is confirmed by the Hon’ble DRP. 11. We observe that this issue came up for consideration before the Tribunal pursuant to the directions of the Hon’ble Delhi High Court for AY 2011-12 and 2012-13. The Tribunal in its order in ITA No. 1479/Del/2016 and ITA No. 507/Del/2017 dated 14.06.2021 proceeded with considering the decision of Hon’ble High Court in Jay Metals Industries Pvt. Ltd. 84 taxmann.com 11 wherein similar issue was considered and decided. In para 9 the Tribunal set out the question of law before the Hon’ble Delhi High Court and in para 10 extracted the observations of the Hon’ble Delhi High Court and analysed the facts of the assessee’s case and the findings of the Ld. AO viz. a viz. the findings and the observations of the Hon’ble Delhi High Court in paras 11 to 15 thereof. The Tribunal, thereafter recorded its findings in paras 16-25 of its order (supra) which is extracted below:- “16. We have given thoughtful consideration to the findings of the Assessing Officer but we do not concur with the findings. There is no dispute that the lease agreement is a composite lease agreement which included the inbuilt infrastructural facilities provided which included central air conditions with ducting, DG power supply, net work equipments, access control equipments, electrical equipments, VAVs and controllers, smoke detectors and occupancy sensors. 17. The agreement also included other amenities, namely installation of dish antenna/satellite, parking space, repair and maintenance which includes repairs, interior or exterior, electrical and plumbing work, repair and maintenance of common and open areas and facilities provided at the building like compounds, gardens, passage, elevators, lifts, terrace, DG sets etc and also 100% power backup and centralised air conditioning. 18. In our considered opinion, for similar set of amenities/facilities, the Hon'ble Supreme Court in the case of Sultan Brothers [supra] has laid down certain tests which have been followed by the Hon'ble High Court of Delhi in the case of Garg Dyeing & Processing Industries [supra] and later on in the case of Jay Metals [supra]. We are of the considered view that in light of the facts discussed hereinabove, there can be no doubt that lease deed was composite one and rental receipt thereunder answered the description u/s 56(2)(iii) of the Income tax Act, 1961. 19. We find that the main thrust in rejecting the claim of the assessee by the Assessing Officer is that it is a related party transaction. The undisputed fact is that the assessment 11 ITA No.602/Del/2021 was subject to transfer pricing assessment for determination of ALP with AE and no such determination has been done by the TPO. We further find that though the Assessing Officer has discarded the claim of the assessee stating that it is a related party transaction, but the provisions of section 40A(2) of the Act have never been invoked. 20. In fact, the Assessing Officer himself has extracted the relevant clauses of lease deed himself showing that the lessor has agreed to provide services which have been enumerated hereinabove elsewhere. Therefore, considering the facts of the case in hand, we find that letting is not merely of the building but a composite let out of both building as well as equipment/furniture etc and thereby 56(2)(iii) of the Act is attracted. 21. Respectfully following the ratio laid down by the Hon'ble Supreme Court in the case of Sultan Brothers [supra] and the Hon'ble High Court of Delhi in the case of Jay Metals [supra], we direct the Assessing Officer to treat the income from letting out of the building as income under the head “Income from other sources”. 22. The other ground which relates to the claim of expenses and depreciation u/s 57 of the Act has already been answered by the Hon'ble High Court of Delhi in the case of Jay Metals [supra] as under: 26. However, the last plea made by the Assessee is that in that event the entire income from the letting is treated as 'income from source sources', it cannot be deprived of the corresponding deduction in terms of Section 57 (iii) of the Act. The Revenue too has not disputed the fact that the Assessee has not claimed depreciation. 27. Accordingly, it is directed that while giving the appeal effect, the AO will grant the Assessee the benefit of Section 57 (iii) of the Act. 23. Respectfully following the findings of the Hon'ble High Court, we direct accordingly. 24. As mentioned elsewhere, facts of A.Y 2012-13 being identical to A.Y 2011- 12, we decide accordingly. 25. In the result, the grounds restored to the file of the Tribunal by the Hon’ble High Court are decided in favour of the assessee and against the Revenue.” 12. We appreciate the efforts made by the Ld. DR to convince us that the lease deed in question is not composite and that the rental receipt does not answer the description under section 56(2)(iii) of the Act. We, however, do not subscribe to the views expressed by him in his written submission which are nothing but reiteration of what the Ld. AO has said in the assessment order which has been duly considered by the Tribunal in the order (supra). The Tribunal in para 18 has observed that for similar set of amenities/facilities, the Hon’ble Supreme Court in Sultan Brothers Pvt. Ltd. (supra) has laid down certain tests which have been followed by the Hon’ble Delhi High Court in Garg Dyeing & Processing Industries vs. ACIT (2012) (ITA 319/2012) (Del) and later in Jay Metals (supra). Testing the facts of the assessee’s case on the touchstone of the decisions (supra) the Tribunal recorded its unequivocal finding that the lease deed under consideration was composite one and that it answered the description under section 56(2)(iii) of the Act. Another objection of the Revenue that it is related party transaction has also been rejected by the Tribunal by saying that no 12 ITA No.602/Del/2021 adverse view has been taken in determination of ALP with AE by the Ld. TPO nor provisions of Section 40A(2) have ever been invoked. 13. In subsequent AYs 2014-15 and 2015-16 also the same issue has been decided by the Tribunal in favour of the assessee in its order dated 24.09.2021 in ITA No. 8229/Del/2018 and 8143/Del/2019 wherein the Tribunal followed its decision dated 14.06.2021 for AY 2011-12 and AY 2012-13. 14. The AY under our consideration falls in between. 15. Admittedly, as Ld. AO says in para 4.3 of his order, in AY 2013-14 also the facts of the case are similar to that of the earlier years. On such admitted fact situation, the co-ordinate benches of the Tribunal have decided this issue in earlier years as also in subsequent years in favour of the assessee. Therefore, there is no reason for us to deviate from the same in the absence of any fresh adverse material in the records. Accordingly the modified ground No.1, 2.1 and 2.2 are decided in favour of the assessee with the direction to the Ld. AO to follow the decision of the Hon’ble Delhi High Court in Jay Metals (supra) in respect of the assessee’s claim of expenses and depreciation under section 57 of the Act extracted by the Tribunal in para 22 of its order (supra) for AY 2011-12 and 2012-13. We order accordingly.” 12. Respectfully following the coordinate Bench order in assessee’s own case for AY 2013-14 (supra), the issue is decided in favour of the assessee with the same directions to the AO as above. 13. As regards the issue of non-granting of tax deducted at source, AO shall examine the same and decide as per law. 14. In the result, the appeal filed by the assessee is partly allowed for statistical purposes. Order pronounced in the open court on 25 th day of August, 2022. Sd/- sd/- (SAKTIJIT DEY) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated the 25 th day of August, 2022 TS Copy forwarded to: 1.Appellant 2.Respondent 3.CIT 4.DRP 5.CIT(ITAT), New Delhi. AR, ITAT NEW DELHI.