Bentley Systems India Pvt. Ltd., New Delhi V. ACIT, New Delhi

ITA 6160/DEL/2013

• Counselvise Citation: 616020114 RSA 2013
• Duration Of Justice: 1 year(s) 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 15-01-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 18-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PEEYUSH JAIN
• Assessee Lawyers: NEHA SINGH ADV S
• Keywords: Transfer pricing; International transaction; Additional evidence
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: I NEW DELHI BEFORE SHRI I. C. SUDHIR , JUDICIAL MEMBER AND SHRI J. S. REDDY, ACCOUNTANT MEMBER I.T.A. NO. 6160 /DEL/201 3 ASSESSMENT YEARS: 200 7 - 0 8 BENTLEY SYSTEMS INDIA PVT. LTD. VS. ACIT 203, 2 ND FLOOR, CIRCLE - 2(1) OKHLA INDUSTRIAL AREA, PHASE - III NEW DELHI. NEW DELHI - 1100 2 0 PAN: AA BCB5645E (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI. DEEPAK CHOPRA , & MS. NEHA SINGH ADV S . REVENUE BY : S HRI . PEEYUSH JAIN , CIT .DR. ORDER PER J. S. REDDY, AM : THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF ASSESSING OFFICER PASSED U/S 143(3) R.W.S. 144C R.W.S. 254 OF THE INCOME TAX ACT 1961 (HEREINAFTER REFERRED TO AS THE ACT) . 2. IN T HE FIRST ROUND OF APPELLATE PROCEEDINGS THE ITAT, IN ITA NO. 5730/DEL/20 11 ORDER DATED 5.9.2012 HELD AS FOLLOWS: 7. A PERUSAL OF THE ABOVE CONTENTS OF THE WRITTEN SUBMISSION FILED BY THE ASSESSEE BEFO RE THE TPO SHOWS THAT THE DATA WAS PROVIDED BY THE ASSESSEE BEFORE THE TPO 2 CONCERNING THE INTERNATIONAL TRANSACTION PERTAINING TO AVAILING OF INTRA GROUP SERVICES BY THE ASSESSEE FROM ITS ASSOCIATED ENTERPRISES AS TO HOW THIS DATA IS INADEQUATE, HAS NOT BE EN MADE CLEAR BY THE LD. DRP AND IT HAS MERELY BEEN OBSERVED THAT CONSIDERING TH FACTS AND CIRCUMSTANCES OF THE CASE THE POSITION PUT FORTH BY THE TPO WAS BEING ACCEPTED IN THE ABSENCE OF ADEQUATE DATA. THE ASSESSEE S OBJECTIONS IN THIS REGARD WERE, AS SUC H, REJECTED WITHOUT PASSING A SPEAKING ORDER. 8. IN THE AFOREMENTIONED CIRCUMSTANCES, WE DEEM IT PROPER TO REMIT THIS MATTER TO THE FILE OF THE LD. DRP TO BE DECIDED AFRESH IN ACCORDANCE WITH LAW ON CONSIDERING THE AFORESAID DATA PROVIDED BY THE ASSESSEE BEFORE THE TPO. 3. T HE DRP VIDE ITS ORDER DATED 16.8.2013 IN THE SET ASIDE PROCEEDING AT PARA 6 & 7 HAS OBSERVED AS FOLLOWS: 6. IN VIEW OF THE ABOVE DIRECTIONS OF THE HON BLE ITAT, THE MATTER BEFORE THE DRP IS LIMITED TO RE - APPRAISAL OF THE DATA PROVIDED BY THE ASSESSEE BEFORE THE TPO ON THE ISSUE OF AVAILING OF INTRA - GROUP SERVICES. 7. ASSESSEE HAD SUBMITTED TRANSFER PRICING STUDY MAINTAINED BY THE ASSESSEE FOR THE FY 2006 - 07. THE ASSESSEE HAS SUBMITTED LETTERS BEFORE THE TPO DATED 27.04.2010, 5.05.2010, 13.05.2010 AND 21.09.2010. THE SUFFICIENCY OF EVIDENCE TO JUSTIFYING THE PAYMENT FOR AVAILING OF SERVICES FROM THE GROUP COMPANIES NEEDS TO JUDGE BASED ON THESE DOCUMENTATION PRESENTED BEFORE THE TPO. (EMPHASIS) 3 4 . THEREAFTER AT PARA 7.2 THE DRP HELD AS FOLLOWS : THERE ARE TWO ASPECTS TO THIS CONCLUSION OF THE TPO. THE FIRST AND FOREMOST IS THAT THE ASSESSEE SHOULD ESTABLISH THROUGH DOCUMENTARY EVIDENCE THAT IT HAS RECEIVED MANAGEMENT SERVICES. THE SECOND LIMB IS THAT THE VALUES OF SUCH SERVICE S ARE AT ARM S LENGTH. IN THE PRESENT CASE, THE ASSESSEE HAS FAILED TO ESTABLISH BOTH. THEREFORE, AFTER CAREFULLY EXAMINING THE DOCUMENTS PRODUCED BEFORE THE TPO, DRP COMES TO THE CONCLUSION THAT THE TPO WAS RIGHT IN HOLDING THAT THE ARM S LENGTH PRICE OF TH IS TRANSACTION RELATING TO RECEIPT OF CORPORATE SERVICES WAS NIL. 5 . AGGRIEVED THE ASSESSEE FILED AN APPEAL, IT ALSO FILED AN APPLICATION FOR ADMISSION OF ADDITIONAL EVIDENCE AS THE DRP DID NOT CONSIDER THE EVIDENCE FILED BEFORE IT. . 6 . AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE OF THE CONSIDERED OPINION THAT THE DRP HAS NOT FOLLOWED THE DIRECTIONS OF THE TRIBUNAL . THE EVIDENCE FILED BY THE ASSESSEE BEFORE IT SHOULD HAVE BEEN TAKEN ON RECORD A S P ER SECTION 144(C) (6) (C) OF THE AC T AND IT G OES INTO THE ROOT OF THE MATTER AND ARE NECESSARY FOR ADJUDICATION OF THE APPEAL. I N THESE CIRCUMSTANCES, WE ARE OF THE CONSIDERED OPINION THAT THE ADDITIONAL EVIDENCE PROVIDED BY THE ASSESSEE SHOULD BE ADMITTED. 7 . IN THE RESULT, WE ADMIT THESE ADDITIONA L EVIDENCES. AS THESE EVIDENCES HAVE TO BE CONSIDERED ON MERIT, WE SET ASIDE THE MATTER TO THE FILE OF THE AO FOR 4 FRESH ADJUDICATION, AFTER OBTAINING A REPORT FROM TPO. THE TPO SHALL PASS AN ORDER DE - NOVO, AFTER PROVIDING ADEQUATE OPPORTUNITY TO THE ASSESS EE. 8 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 1 8 T H / 02/2015. S D / - S D / - ( I. C. SUDHIR ) (J. S. REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 8 T H /02/2015 *AK VERMA* COPY FORWARDED TO: 1. ASSESSEE 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR