DCIT, Puducherry V. M/s. Tweezerman (India) Pvt.Ltd., Puducherry

ITA 612/CHNY/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61177 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 23-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR SIBENDU MOHARANA IRS
• Assessee Lawyers: R VIJAYARAGHAVAN
• Keywords: Transfer pricing
• Section: 143(3); 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI V.DURGA RAO, JUDICIAL MEMBER ITA NO.612(MDS)/2012 ASSESSMENT YEAR:2007-08 THE DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE I, PUDUCHERRY. VS. M/S.TWEEZERMAN(INDIA) PVT. LTD., C-24, INDUSTRIAL ESTATE, THATTANCHAVADY, PUDUCHERRY-9. PAN AABCT3599F. (APPELLANT) (RESPONDENT) APPELLANT BY : DR.SIBENDU MOHARANA, IRS, CIT RESPONDENT BY: SHRI R.VIJAYARAGHAVAN, AD VOCATE DATE OF HEARING : 24 TH MAY, 2012 DATE OF PRONOUNCEMENT : 24 TH MAY, 2012 O R D E R PER DR.O.K.NARAYANAN, VICE PRESIDENT THIS APPEAL IS FILED BY THE REVENUE. THE RELEVAN T ASSESSMENT YEAR IS 2007-08. THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-XI I AT CHENNAI, DATED 2-12-2011 AND ARISES OUT OF THE ASSE SSMENT COMPLETED UNDER SECTION 143(3) OF THE INCOME-TAX AC T, 1961. - - ITA 612 OF 2012 2 2. THE ONLY ISSUE RAISED BY THE REVENUE IN THIS AP PEAL IS REGARDING THE EXCESS PROFIT WORKED OUT BY THE TR ANSFER PRICING OFFICER OVER AND ABOVE THE ARMS LENGTH PRICE AND TH E ASSESSING OFFICER TREATING THE SAME AS TAXABLE INCOME IN THE HANDS OF THE ASSESSEE BY NOT GIVING DEDUCTION UNDER SECTION 10B TO THAT EXTENT. 3. THE RELEVANT GROUND OF APPEAL IS REPRODUCED BELOW:- THE DECISION OF THE LEARNED COMMISSIONER OF INCOME-TAX(APPEALS) IS NOT ACCEPTABLE FOR THE REASON THAT THE ISSUE INVOLVED IN THIS CASE FOR THI S YEAR, EARLIER YEARS AND SUBSEQUENT YEARS IS THAT TH E PURPOSE OF REFERRING TO THE TPO IN THIS CASE HAS ALWAYS BEEN TO DETERMINE THE EXCESS PROFITS SHOWN BY THE ASSESSEE OVER AND ABOVE THE NORMAL PROFITS IN COMPARABLE CASES AND EXCLUDE THE SAME FROM COMPUTATION OF EXEMPTION U/S 10B AND ASSESS SUCH INCOME UNDER OTHER SOURCES. HENCE, THE ALP - - ITA 612 OF 2012 3 BEING LESS THAN THE ASSESSEES SALE VALUE WOULD ONLY STRENGTHEN THE ORDER OF THE ASSESSING OFFICER. 4. THIS ISSUE IS SQUARELY COVERED BY THE DECISION OF THE INCOME-TAX APPELLATE TRIBUNAL, CHENNAI BENCH-D IN T HE CASE OF VISUAL GRAPHICS COMPUTING SERVICES(INDIA) P. LTD. V S. ACIT, REPORTED IN 15 ITR (TRIB) 393 (CHENNAI). IT HAS BE EN HELD IN THE ABOVE DECISION THAT THE ASSESSING OFFICER HAS ERRED IN REDUCING FROM THE ELIGIBLE PROFIT OF THE ASSESSEE THE EXCESS OF THE PRICE REALIZED BY THE ASSESSEE OVER THE ARMS LENGTH PRICE DETERMINED BY THE TRANSFER PRICING OFFICER, FOR THE PURPOSE OF SECTION 10A. WHILE ARRIVING AT THE ABOVE DECISION, THE TRIBUNAL HAS FOLLOWED THE DECISION OF THE INCOME-TAX APPELLATE TRIBUNAL, CHENNAI, RENDERED IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2004-05, REPORTED IN 4 ITR(TRIB.) 130(CHENNAI). 5. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE UPHOLD THE ORDER OF THE COMMISSIONER OF INCOME-TAX( APPEALS). - - ITA 612 OF 2012 4 6. IN RESULT, THIS APPEAL FILED BY THE REVENUE IS DISMISSED. ORDERS PRONOUNCED IN THE OPEN COURT AT THE TIME O F HEARING ON THURSDAY, THE 24 TH OF MAY, 2012 AT CHENNAI. SD/- SD/- (V.DURGA RAO) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED, THE 24TH MAY, 2012. V.A.P. COPY TO: 1. ASSESSEE 2. DEPARTMENT 3. CIT 4. CIT(A) 5. DR 6. GF.