ACIT CIR. 13(3), MUMBAI V. M/s. PRABHAT INDUSTRIES, MUMBAI

ITA 6249/MUM/2005

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1353 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 8 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2010
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: J
• Assessment Year: 2000-2001
• Appeal Filed On: 21-10-2005
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: MRS AARTI VISSANJI
• Keywords: Transfer pricing; Opportunity of being heard; International transaction; Set aside
• Section: 92C; 92D; 92A; 92E; 80HHC; 10B; 92

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH L,MUMBAI BEFORE SHRI R.S. PADVEKAR (JM) & SHRI R.K. PANDA(AM ) I.T.A.NO.6429/MUM/2005 (A.Y. 2002-03) DY.COMMR. OF INCOME-TAX-16(3), MATRU MANDIR, TARDEO ROAD, MUMBAI-400 007. VS. M/S. S. NARENDRA, 405, MEHTA BHAVAN, \311, CHARNI RD., MUMBAI-400 004. PAN:AAAFS29994P APPELLANT RESPONDENT I.T.A.NO.643 1/MUM/2005 (A.Y. 2002-03) DY.COMMR. OF INCOME-TAX-16(3), MATRU MANDIR, TARDEO ROAD, MUMBAI-400 007. VS. M/S.NAVINCHANDRA LAXMICHAND SHAH, 812-A, PRASAD CHAMBERS, OPERA HOUSE,MUMBAI-400 004. PAN:AAAFN1212B APPELLANT RESPONDENT I.T.A.NO.6432/MUM/2005 (A.Y. 2002-03) DY.COMMR. OF INCOME-TAX-16(3), MATRU MANDIR, TARDEO ROAD, MUMBAI-400 007. VS. M/S.K.RAJNIKANT & CO., 101, PANCHRATNA, OPERA HOUSE,MUMBAI-400 004. PAN:AAAFK1490J APPELLANT RESPONDENT I.T.A.NO.6435/MUM/2005 (A.Y. 2002-03) DY.COMMR. OF INCOME-TAX-16(3), MATRU MANDIR, TARDEO ROAD, MUMBAI-400 007. VS. M/S.POPATLAL NATHALAL SHAH, 1802, PANCHRATNA, OPERA HOUSE, MUMBAI-400 004. PAN:AAAFP0468K APPELLANT RESPONDENT APPELLANT BY SHRI AARSI PRASAD. RESPONDENTS BY MRS. AARTI VISSANJI. O R D E R PER R.K. PANDA, AM: THE ABOVE FOUR APPEALS FILED BY THE REVENUE ARE DIR ECTED AGAINST THE ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 2 SEPARATE ORDERS OF THE CIT(A)XVII, MUMBAI, RELATING TO ASST. YEAR 2002-03. SINCE COMMON GROUNDS ARE INVOLVED IN ALL THESE APPEALS, T HEREFORE, THEY WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON O RDER. ITA NO.6432/MUM/2005 (DCIT VS. M/S.K.RAJNIKANT & CO .-A.Y.2002-03) : 2. GROUND NO.1 BY THE REVENUE READS AS UNDER : 1. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND O N FACTS IN DIRECTING THE AO TO CONSIDER FOREIGN EXCHANGE RATE DIFFERENCE GAIN OF RS.4,75,092/-PERTAINING TO THE EXPORTS OF EARLIER Y EARS ELIGIBLE FOR DEDUCTION U/S.80HHC OF THE I.T.ACT, 1961 WITHOUT AP PRECIATING THE FACTS THAT THE SAID AMOUNT DID NOT FORM PART OF EXP ORT TURNOVER FOR THE ASSESSMENT YEAR UNDER QUESTION AS DEFINED IN CL AUSE (B) OF EXPLANATION BELOW SUB-SECTION (4C) OF SEC.80HHC OF THE I.T.ACT, 1961. 2.1 BOTH THE PARTIES FAIRLY AGREED THAT THE ISSUE S HOULD BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE DECIS ION OF THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF PRAKASH L. SAHA REPORTED IN 115 ITD 167(SB). WE, THEREFORE, RESTORE THIS ISSUE TO THE FILE OF AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE DECISION OF THE SPECIAL BENCH CITED ABOVE. THIS GROUND BY THE REVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 3. GROUND NO.2 BY THE REVENUE READS AS UNDER : 2. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING THE AO TO DELETE THE ADDITION OF RS.29,99 ,837/- WHICH WAS MADE U/S.92CA(3) AS PER ORDER OF THE ADDL. CIT, T.P .-III DATED 15.03.2005. 3.1 THE FACTS OF THE CASE, IN BRIEF, ARE THAT THE A SSESSEE FIRM IS ENGAGED IN THE BUSINESS OF IMPORT, MANUFACTURE AND EXPORT OF DIAMO NDS. DURING THE YEAR, THE ASSESSEE HAS SHOWN EXPORT SALES OF POLISHED DIAMOND S AT RS.8,28,55,764/- AND DECLARED A GROSS TOTAL INCOME OF RS.56,62,102/-. TH E ASSESSEE HAS CLAIMED DEDUCTION U/S.80HHC AT RS.64,28,232/-. THE AO NOTED THAT THE TPO IN THE INSTANT CASE HAS INTIMATED ENHANCEMENT OF TOTAL INC OME BY RS.29,99,834/- ON ACCOUNT OF ADJUSTMENT TO THE VALUE OF INTERNATIONAL TRANSACTION ENTERED INTO BY ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 3 THE ASSESSEE. THE AO CONFRONTED THE SAME TO THE ASS ESSEE. IT WAS SUBMITTED THAT THE TPO HAS APPLIED OPERATING PROFIT MARGIN OF INDE PENDENT ENTERPRISES AS ENTIRE SALES OR OPERATING COST OF THE ASSESSEE. IT WAS FUR THER SUBMITTED THAT CHAPTER X AUTHORIZES TPO TO DETERMINE ALP OF AN INTERNATIONA L TRANSACTION WITH AE AND NOT FOR ALL THE TRANSACTIONS OF THE ASSESSEE. THE ASSES SEE FURTHER STATED THAT THE ASSESSEES APPLICATION U/S.154 IS PENDING BEFORE TH E TPO. SINCE THE RECTIFICATION PETITION WAS NOT YET DISPOSED OF BY THE TPO, THE AO ADDED AN AMOUNT OF RS.29,99,534/- TO THE INCOME OF THE ASSESSEE AS DIR ECTED BY THE TPO. 4. IN APPEAL, THE CIT(A) DIRECTED THE AO TO DELETE THE ADDITION OF RS.29,99,837/- WHICH WAS MADE U/S.92CA OF THE I.T. ACT. WHILE DOING SO, SHE NOTED THAT THE INCLUSION OF THE TRADING RESULTS OF M/S.DHARMANANDAN DIAMONDS AND M/S. ROYAL DIAM HAD GIVEN A DISTORTED WORKING O F OPERATING PROFIT MARGIN TO SALES AND COST. AFTER EXCLUDING THE TRADING RESULTS OF THESE ENTITIES FROM THE LIST OF COMPARABLE CASES, THE PROFIT MARGIN TO SALES WORKED AT 5.46% AND TO COST AT 5.8% WHICH ARE WITHIN THE RANGE OF +/- MINUS 5% VA RIATION AS STIPULATED IN SEC. 92C(2) OF THE T.P. RULES & REGULATIONS. HE ACCORDIN GLY DIRECTED THE AO TO DELETE THE ADDITION OF RS.29,99,834/- BEING THE ADJUSTMENT TO ALP AS CALCULATED BY THE AO. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE RE VENUE IS IN APPEAL BEFORE US. 5. THE LD. D.R., REFERRING TO THE DECISION OF THE T RIBUNAL IN THE CASE OF ACIT VS. M/S. TWINKLE DIAMONDS VIDE ITA NO.5300/M/07 ORD ER DATED 30-04-2010 FOR THE ASST. YEAR 2004-05 AND IN THE CASE OF DCIT VS. STARLITE VIDE ITA NO.2279/M/06 ORDER DATED 20-04-2010, SUBMITTED THAT UNDER IDENTICAL FACTS AND CIRCUMSTANCES THE TRIBUNAL HAS RESTORED THE MATTER TO THE FILE OF THE AO FOR FRESH ADJUDICATION. THEREFORE, THIS MATTER IS ALSO REQUIR ED TO BE SET ASIDE TO THE FILE OF THE AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE F INDINGS GIVEN IN THE ABOVEMENTIONED ORDER OF THE TRIBUNAL. ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 4 6. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER H AND, SUBMITTED THAT THE DECISIONS CITED BY THE LD. D.R. ARE NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. SHE SUBMITTED THAT NET PROFIT MARGIN DERIVED FROM S ALE OF DIAMONDS IN EVERY INTERNATIONAL TRANSACTION VARIES PRIMARILY BECAUSE EVERY DIAMOND HAS DIFFERENT QUALITIES. SHE SUBMITTED THAT THE VALUE OF A DIAMON D IS BASED UPON 4 QUALITIES I.E. COLOUR, CUT, CARATAGE AND CLARITY. DIAMONDS BEING N ATURAL PRODUCTS ARE NEVER ALIKE EVEN IF TWO DIAMONDS HAVE THE SAME CHARACTERS AND C UT, COLOUR OR CLARITY. FURTHER, BASED ON INDIVIDUAL FEATURES, THE PRICE VA RIES. THE PRICE IS FURTHER AFFECTED BY FLAW WHICH AN INDIVIDUAL DIAMOND MAY HA VE. THEREFORE, THOUGH TWO TRANSACTIONS COULD INVOLVE THE SAME NUMBER OF DIAMO NDS, THE NET MARGIN WOULD VARY BECAUSE THE DIAMONDS ARE NOT IDENTICAL. SHE SU BMITTED THAT IN VIEW OF THE LARGE QUANTITIES OF DIAMONDS WHICH THE ASSESSEE DEA LS IN, THE COST OF EACH DIAMOND IS IMPOSSIBLE TO BE DETERMINED. THE ASSESS EE IMPORTS ROUGH DIAMONDS WHICH COMES IN LOTS. THEREAFTER, THESE ARE CUT AND POLISHED. THE ASSESSEE CAN THEREFORE MAINTAIN ONLY QUANTITYWISE RECORDS. DIAMO NDS ARE NOT SOLD IN SAME LOTS AS THEY ARE PURCHASED. THERE IS A VARIATION DEPENDI NG UPON THE REQUIREMENTS OF THE BUYER. THEREFORE, THERE IS A CONSTANT RE-ASSORT MENT OF THE STOCK THAT THE ASSESSEE HOLDS AND THEREFORE THE IDENTITY OF THE FI NISHED GOODS VIS--VIS ROUGH DIAMONDS PURCHASED IS LOST. THE GROSS PROFIT MARGIN FROM THE SALE OF EACH DIAMOND THEREFORE CANNOT BE WORKED OUT. 7. THE LD. COUNSEL FOR THE ASSESSEE FURTHER SUBMITT ED THAT WHEN DIAMONDS ARE EXPORTED FROM INDIA, THEIR VALUES ARE ASSESSED BY T HE CUSTOMS AUTHORITIES. THE CUSTOMS DEPT. OF ALMOST ALL COUNTRIES HAVE A SEPARA TE SET UP WITH TRAINED VALUERS/ASSESSORS FOR DIAMONDS. ONCE THE SALE VALUE OF EXPORTS HAS BEEN ACCEPTED BY THE TRAINED VALUERS OF A GOVT. AUTHORIT Y, IT WOULD NOT BE OPEN FOR THE TPO TO DISPUTE THE TRANSACTION. SHE SUBMITTED THAT ALL THESE FACTORS WERE NOT ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 5 CONSIDERED BY THE TRIBUNAL IN THE CASE OF TWINKLE D IAMONDS & STARLITE (SUPRA). THEREFORE, THOSE DECISIONS CANNOT BE APPLIED TO THE FACTS OF THE PRESENT CASE. REFERRING TO THE DECISION OF THE TRIBUNAL IN THE CA SE OF INDO AMERICAN JEWELLERY, SHE SUBMITTED THAT THE TRIBUNAL IN THE SAID CASE HA S ACCEPTED THAT THERE CAN BE NO INTENTION TO SHIFT THE PROFIT OFF SHORE IF THE AE RESIDES IN A COUNTRY WHERE THE TAX RATE IS HIGHER. SHE SUBMITTED THAT IN THE INSTA NT CASE THE AE IS RESIDENT OF BELGIUM WHERE THE PREVAILING TAX RATE IS 40.17%. SI NCE THE ASSESSEE IS AN 100% EXPORTER AND WAS ENTITLED TO DEDUCTION OF 70% OF IT S ELIGIBLE PROFITS U/S.80HHC, THEREFORE, THE EFFECTIVE TAX IS LESS THAN 13.15% AP PROXIMATELY. THEREFORE, THERE WAS NO PLAUSIBLE REASON TO SHIFT THE PROFIT TO THE AE. SHE SUBMITTED THAT THE TPO HAS NOT GIVEN THE BENEFIT OF +/- 5% AS STIPULATED I N SEC. 92C(2) OF THE I.T. ACT. SHE SUBMITTED THAT ADJUSTMENT, IF ANY, SHOULD BE RE STRICTED TO THE SALES TO AE. HOWEVER, THE TPO, IN THE INSTANT CASE, HAS MADE THE ADDITION TO ALL THE SALES INCLUDING SALES TO THIRD/NON-RELATED PARTIES, WHICH IS NOT PROPER. 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND THE PAPER B OOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECIS IONS CITED BEFORE US. WE FIND THE FACTS OF THE IMPUGNED CASE ARE IDENTICAL TO THE FACTS OF THE CASE IN THE CASE OF M/S. STARLITE (SUPRA). ADMITTEDLY, THE VARIOUS ARGU MENTS ADVANCED BY THE LD. COUNSEL FOR THE ASSESSEE BEFORE US WERE NOT BEFORE THE AO OR CIT(A). WE FIND THE TRIBUNAL IN THE CASE OF M/S. STARLITE (SUPRA) , AFTER CONSIDERING THE MEANING OF INTERNATIONAL TRANSACTIONS, COMPUTATION OF ALP AND DETERMINATION OF ALP U/S.92C AT PARAS 10 TO 13 OF THE ORDER, HAS HELD AS UNDER : 10. WE HAVE HEARD MR. APURVA SHAH, LEARNED COUNSEL FOR THE ASSESSEE AND MR. AARSI PRASAD, LEARNED DR. ON CAREFUL CONSIDERA TION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, PERUSAL OF THE PAPERS ON RECORD AND ORDER OF AUTHORITIES BELOW AS WELL AS CASE LAWS CITED, WE HO LD AS FOLLOWS :- ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 6 GROUND NO. 1 IN BOTH ASSESSEES APPEAL, AS WELL AS REVENUES APPEAL, PERTAIN TO ADJUSTMENTS MADE CONSEQUENT TO, DETERMINATION OF ALP, IN AN INTERNATIONAL TRANSACTIONS WITH AN ASSOCIATED ENTER PRISES UNDER TRANSFER PRICING REGULATIONS, LAID DOWN UNDER CHAPTER-X OF THE INCOME TAX ACT 1961. LEARNED COUNSEL FOR THE ASSESSEE HAS NOT DISPUTED T HE FACT THAT TRANSACTIONS IN QUESTION, WERE IN FACT WITH ASSOCIATED ENTERPRIS ES AS DEFINED IN SECTION 92A OF THE ACT. THE ASSESSEE HAD VOLUNTARILY FILED TRAN SFER PRICING REPOT IN FORM NO. 3CEB FOR TRANSACTIONS WITH THE A.E. THUS, THIS ISSUE IS NOT BEFORE US AND WE CANNOT COMMENT ON THE SAME. THERE IS NO DISPUTE RAISED BY THE ASSESSEE IN THIS REGARD. COMING TO THE ISSUE OF DETERMINATION OF ALP, WE AGR EE WITH THE FINDINGS OF TPO AT PARAGRAPH NO. 9 OF HER ORDER, WHICH IS ALREA DY EXTRACTED IN PARA 3 OF THIS ORDER. IT IS MANDATORY UNDER SPECIAL PROVISION STIPULATED IN CHAPTER-X OF THE INCOME TAX ACT, 1961, TO COMPUTE THE ALP IN ONE OF THE METHODS SPECIFIED UNDER STATUTE. SECTION 92(1) READS AS FOL LOWS :- MEANING OF INTERNATIONAL TRANSACTION . 92B. (1) FOR THE PURPOSES OF THIS SECTION AND SECTIONS 92 , 92C , 92D AND 92E , INTERNATIONAL TRANSACTION MEANS A TRANSACTION BET WEEN TWO OR MORE ASSOCIATED ENTERPRISES, EITHER OR BOTH OF WHOM ARE NON-RESIDEN TS, IN THE NATURE OF PURCHASE, SALE OR LEASE OF TANGIBLE OR INTANGIBLE PROPERTY, O R PROVISION OF SERVICES, OR LENDING OR BORROWING MONEY, OR ANY OTHER TRANSACTIO N HAVING A BEARING ON THE PROFITS, INCOME, LOSSES OR ASSETS OF SUCH ENTERPRIS ES, AND SHALL INCLUDE A MUTUAL AGREEMENT OR ARRANGEMENT BETWEEN TWO OR MORE ASSOCI ATED ENTERPRISES FOR THE ALLOCATION OR APPORTIONMENT OF, OR ANY CONTRIBUTION TO, ANY COST OR EXPENSE INCURRED OR TO BE INCURRED IN CONNECTION WITH A BEN EFIT, SERVICE OR FACILITY PROVIDED OR TO BE PROVIDED TO ANY ONE OR MORE OF SU CH ENTERPRISES. SECTION 92(C) READS AS FOLLOWS : COMPUTATION OF ARMS LENGTH PRICE . 92C. (1) THE ARMS LENGTH PRICE IN RELATION TO AN INTERN ATIONAL TRANSACTION SHALL BE DETERMINED BY ANY OF THE FOLLOWING METHODS , BEING THE MOST APPROPRIATE METHOD, HAVING REGARD TO THE NATURE OF TRANSACTION OR CLASS OF TRANSACTION OR CLASS OF ASSOCIATED PERSONS OR FUNCTIONS PERFORMED BY SUC H PERSONS OR SUCH OTHER RELEVANT FACTORS AS THE BOARD MAY PRESCRIBE 78 , NAMELY : ( A ) COMPARABLE UNCONTROLLED PRICE METHOD; ( B ) RESALE PRICE METHOD; ( C ) COST PLUS METHOD; ( D ) PROFIT SPLIT METHOD; ( E ) TRANSACTIONAL NET MARGIN METHOD; ( F ) SUCH OTHER METHOD AS MAY BE PRESCRIBED 79 BY THE BOARD. RULE 10B READS AS FOLLOWS : DETERMINATION OF ARMS LENGTH PRICE UNDER SECTION 92C. 10B. (1) FOR THE PURPOSES OF SUB-SECTION (2) OF SECTION 92C, THE ARMS LENGTH PRICE IN RELATION TO AN INTERNATIONAL TRANSACTION SHALL BE DETERMINED BY ANY OF ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 7 THE FOLLOWING METHODS , BEING THE MOST APPROPRIATE METHOD, IN THE FOLLOWI NG MANNER, NAMELY . 11. PLAIN READING OF THE ABOVE PROVISIONS IN THE AC T AS WELL AS IN THE RULES, SHOW THAT IT IS MANDATORY FOR THE ASSESSEE, TO FOLL OW ONE OF THE PRESCRIBED METHOD AND DEMONSTRATE THAT THE INTERNATIONAL TRANS ACTIONS, ENTERED INTO BY IT, WITH AN ASSOCIATED ENTERPRISE, ARE AT ARMS LENG TH PRICE. BY SIMPLY SAYING THAT NONE OF THE METHODS CAN BE APPLIED AND CITING EXCUSES FOR THE SAME, IN OUR CONSIDERED OPINION DOES NOT ABSOLVE THE ASSESSE E OF ITS STATUTORY DUTY IN DETERMINING ALP AS PER THE LAW. IN A NUMBER OF CASE S, WHERE DIFFERENT ASSESSES, ARE HAVING SIMILAR LINES OF BUSINESS, TRA NSFER PRICING REPORT HAS BEEN FILED AND ONE OF THE METHODS SPECIFIED UNDER T HE ACT WAS USED TO ARRIVE AT AS MOST APPROPRIATE METHOD. SURPRISINGLY, IN THI S CASE, THE ASSESSEE IN OUR HUMBLE OPINION,CONTRARY TO THE STAND OF MANY SIMILA R ORGANIZATIONS, HAS TAKING UNSUSTAINABLE STAND THAT NONE OF THE METHODS PRESCRIBED UNDER LAW, CAN BE FOLLOWED BY IT. THUS, ON THIS ASPECT, WE UPH OLD THE ORDER OF THE TPO. 12. COMING TO THE COMPUTATION OF INCOME ALP BY TPO, AS WELL AS BY THE ASSESSEE, WE FIND THAT TPO HAS ADOPTED ENTERPRISES LEVEL OPERATING MARGINS, AS TNMM FOR THE PURPOSE OF COMPARISON. IN OUR CONSI DERED OPINION, TRANSACTIONS NET MARGIN METHOD (TNMM) DOES NOT PERM IT THE ASSESSEE OR THE ASSESSING OFFICER, TO COMPARE ENTERPRISE LEVEL PROF ITS AND MAKE ADJUSTMENTS UNDER CHAPTER-X. THIS BENCH OF THE TRIBUNAL IN ITA NO. 5034/MUM/07 DATED 15.2.2010, L BENCH IN THE CASE OF ADDL. CIT VS. M /S. TEJ DIAM AT PARAGRAPH 6 ONWARDS HELD AS FOLLOWS :- 6. RIVAL CONTENTIONS HEARD. ON A CAREFUL CONSIDERA TION OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND A PERUSAL O F THE PAPERS ON RECORD AND THE ORDERS OF THE AUTHORITIES BELOW, WE HOLD AS FOLLOWS. 7. THE FOLLOWING DEFINITIONS ARE EXTRACTED FOR READ Y REFERENCE : SECTION 92F(II) ARMS LENGTH PRICE: ARMS LENGTH PRICE MEANS A PRICE WHICH IS APPLIE D OR PROPOSED TO BE APPLIED IN A TRANSACTION BETWEEN PERSONS OTHER THAN ASSOCIATED ENTERPRISES, IN UNCONTROLLED CONDITIONS. (V) - TRANSACTION. TRANSACTION INCLUDES AN ARRANGEMENT, UNDER STANDING OR ACTION IN CONCERT,- ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 8 (A) WHETHER OR NOT SUCH ARRANGEMENT, UNDERSTANDING OR ACTION IS FORMAL OR IN WRITING; OR (B) WHETHER OR NOT SUCH ARRANGEMENT, UNDERSTANDING OR ACTION IS INTENDED TO BE ENFORCEABLE BY LEGAL PROCEEDING. RULE 10B SUB CLAUSE (E) TRANSACTION AT MARGIN MET HOD: ( E ) TRANSACTIONAL NET MARGIN METHOD, BY WHICH, ( I ) THE NET PROFIT MARGIN REALISED BY THE ENTERPRISE FR OM AN INTERNATIONAL TRANSACTION ENTERED INTO WITH AN ASSOCIATED 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 REALISED BY THE ENTERPRISE OR BY AN UNRELATED ENTERPRISE FROM A COMPARABLE UNCONTROLLED TRANSACTION OR A NUMBER OF SUCH TRANSACTIONS IS COM PUTED HAVING REGARD TO THE SAME BASE; ( III ) THE NET PROFIT MARGIN REFERRED TO IN SUB-CLAUSE ( II ) ARISING IN COMPARABLE UNCONTROLLED TRANSACTIONS IS ADJUSTED TO TAKE INTO ACCOUNT THE DIFFERENCES, IF ANY, BETWEEN THE INTERN ATIONAL TRANSACTION AND THE COMPARABLE UNCONTROLLED TRANSAC TIONS, OR BETWEEN THE ENTERPRISES ENTERING INTO SUCH TRANSACT IONS, WHICH COULD MATERIALLY AFFECT THE AMOUNT OF NET PROFIT MA RGIN IN THE OPEN MARKET; ( IV ) THE NET PROFIT MARGIN REALISED BY THE ENTERPRISE 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 TA KEN INTO ACCOUNT TO ARRIVE AT AN ARMS LENGTH PRICE IN RELAT ION TO THE INTERNATIONAL TRANSACTION. 8. A PLAIN READING OF THE ABOVE SHOWS THAT TNMM REQ UIRES COMPARISON OF NET PROFIT MARGINS REALISED BY AN ENT ERPRISE FROM AN INTERNATIONAL TRANSACTION OR AN AGGREGATE O F INTERNATIONAL TRANSACTIONS AND NOT COMPARISONS OF O PERATING MARGINS OF ENTERPRISES. FOR ARRIVING AT THIS CONCLU SION, WE DREW STRENGTH FROM THE DECISION OF MUMBAI L BENCH OF T HE TRIBUNAL IN THE CASE OF UCB INDIA P. LTD. VS. ACIT 121 ITD 1 31 (MUM.) WHERE IT IS HELD THAT SECTION 92C READ WITH RULE 10 B(1)(E) DEALS WITH TRANSACTIONS NET MARGIN METHOD (TNMM) A ND IT ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 9 REFERS TO ONLY NET PROFIT MARGIN REALISED BY AN ENT ERPRISE FROM AN INTERNATIONAL TRANSACTION OR A CLASS OF SUCH TRA NSACTION, BUT NOT OPERATIONAL MARGINS OF ENTERPRISES AS A WHOLE. 9. RESPECTFULLY FOLLOWING THE SAME, WE HOLD THAT TH E TPO AS WELL AS THE AO HAVE COMMITTED AN ERROR BY WRONGLY APPLYI NG TRANSACTION NET MARGIN METHOD. ------ 13. AS IN THIS CASE, TPO HAS NOT APPLIED TRANSACTIO NS NET MARGIN METHOD, AS CONTEMPLATED IN THE ACT, WE HAVE NO OTHER ALTERN ATIVE BUT TO SET ASIDE HER ORDER. IN ANY EVENT, AS THE ASSESSEE HAS ALSO NOT F ULFILLED ITS STATUTORY OBLIGATIONS CONTEMPLATED IN CHAPTER-X OF THE ACT, W E DEEM IT APPROPRIATE, UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, TO S ET ASIDE THE MATTER, TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATIO N. AS BOTH THE ASSESSEE AS WELL AS THE ASSESSING OFFICER HAVE NOT FOLLOWED THE LAW, IN THE INTEREST OF JUSTICE, WE DEEM IT APPROPRIATE TO PERMIT THE ASSES SEE TO FURNISH A FRESH TRANSFER PRICING STUDY REPORT, IN SUPPORT OF ITS CO NTENTION, THAT THE TRANSACTIONS WITH ASSOCIATED ENTERPRISES WERE IN FA CT AT ARMS LENGTH. WE MAKE IT CLEAR THAT THE ASSESSEE WOULD BE ENTITLED TO FUR NISH FRESH INFORMATION AND DOCUMENTATION, OR CHOSE A FRESH METHOD AS PRESCRIBE D, AS THE MOST APPROPRIATE METHOD, IN SUPPORT OF ITS CASE. THE ASS ESSING OFFICER AS WELL AS THE TPO SHALL EXAMINE THE REPORT AS CONTEMPLATED UNDER SECTION 92E DE NOVO, AFTER GIVING APPROPRIATE OPPORTUNITY TO THE ASSESSE E. WE ALSO AGREE WITH THE ARGUMENTS OF LEARNED COUNSEL FOR THE ASSESSEE THAT ADJUSTMENTS, IF ANY, ARISING DUE TO COMPUTATION OF ALP SHOULD BE RESTRICTED ONLY TO THE INTERNATIONAL TRANSACTIONS AND NOT TO THE ENTIRE TURNOVER OF THE ASSESSEE COMPANY .NO ADDITION CAN BE MADE TO LOCAL TRANSACTIONS UNDER CH APTER X OF THE ACT. SUCH THINGS ARE DONE ONLY WHEN THE ASSESSING OFFICER INV OKES SECTION 144. WE DIRECT THE ASSESSING OFFICER TO RESTRICT THE ADJUSTMENTS, IF ANY ONLY TO INTERNATIONAL TRANSACTIONS, WHICH ARE FOUND BY HIM TO HAVE TAKEN PLACE AT A PRICE OTHER THAN ALP. WITH THESE OBSERVATIONS, WE SET ASIDE THE MATTER TO THE ASSESSING OFFICER FOR FRESH ADJUDICATION. WE DO NOT FIND ANY FORCE IN THE ARGUMENTS ADVANCED BY THE LD. COUNSEL FOR THE ASSESSEE SO AS TO TAKE A DIFFERENT VIEW ALREADY TA KEN BY THE TRIBUNAL IN THE CASE OF M/S.STARLITE (SUPRA). CONSIDERING THE TOTALITY O F THE FACTS OF THE CASE AND IN THE INTEREST OF JUSTICE, WE DEEM IT PROPER TO TO RESTO RE THE MATTER TO THE FILE OF AO WITH A DIRECTION TO DECIDE THE ISSUE AFRESH AND IN ACCORDANCE WITH LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE AO SHALL CONSIDER THE VARIOUS ARGUMENTS ADVANCED BY THE LD. COUNSEL FOR T HE ASSESSEE BEFORE THE TRIBUNAL, WHICH WERE NOT BEFORE THE LOWER AUTHORITI ES, AND DECIDE THE ISSUE AFRESH AND IN ACCORDANCE WITH LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 10 THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. THIS GROUND BY THE REVENUE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. 9. GROUND NOS.3 AND 4, BEING GENERAL IN NATURE, ARE DISMISSED. 10. IN THE RESULT, THE REVENUES APPEAL IS PARTLY A LLOWED FOR STATISTICAL PURPOSES. ITA NO.6431/MUM/2005: (DCIT VS. M/S.NAVINCHANDRA LA XMICHAND SHAH - A.Y. 2002-03): 11. GROUND NO. 1 BY THE REVENUE READS AS UNDER : 1. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING THE AO TO CONSIDER FOREIGN EXCHANGE RATE DIFFERENCE GAIN OF RS.6,72,075/- PERTAINING TO THE EXPORTS OF EARLIER YEARS ELIGIBLE FOR DEDUCTION U/S.80HHC OF THE I.T. ACT, 1961 WITHOUT A PPRECIATING THE FACTS THAT THE SAID AMOUNT DID NOT FORM PART OF EXP ORT TURNOVER FOR THE ASSESSMENT YEAR UNDER QUESTION AS DEFINED IN CL AUSE (B) OF EXPLANATION BELOW SUB-SECTION (4C) OF SEC. 80HHC OF THE I.T. ACT, 1961. 11.1 AFTER HEARING BOTH THE SIDES, WE FIND THIS GRO UND IS IDENTICAL TO GROUND NO. 1 IN ITA NO.6432/MUM/2005. WE HAVE ALREADY DECIDED THE ISSUE AND THE MATTER HAS BEEN RESTORED TO THE FILE OF THE AO FOR FRESH A DJUDICATION IN THE LIGHT OF THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN TH E CASE OF PRAKASH L. SAHA (SUPRA). FOLLOWING THE SAME RATIO, THIS GROUND IS A LSO RESTORED TO THE FILE OF AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE DIRECTIONS G IVEN THEREIN. THIS GROUND BY THE REVENUE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURP OSES. 12. GROUND NO. BY HE REVENUE READS AS UNDER : 2. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING THE AO TO DELETE THE ADDITION OF RS.1,24, 18,675/- WHICH WAS MADE U/S.92CA(3) AS PER ORDER OF THE ADDL. CIT, T.P.-2 DATED 07.03.2005. 12.1 AFTER HEARING BOTH THE SIDES, WE FIND THIS GRO UND IS IDENTICAL TO GROUND NO.2 IN ITA NO.6432/MUM/05. WE HAVE ALREADY DECIDED THE ISSUE AND THE GROUND RAISED BY THE REVENUE HAS BEEN RESTORED TO THE FILE OF AO FOR FRESH ADJUDICATION. ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 11 FOLLOWING THE SAME RATIO, THIS GROUND BY THE REVENU E IS RESTORED TO THE FILE OF AO FOR FRESH ADJUDICATION. THE GROUND RAISED BY THE RE VENUE IS ALLOWED FOR STATISTICAL PURPOSES. 13. IN THE RESULT, THE APPEAL BY THE REVENUE IS A LLOWED FOR STATISTICAL PURPOSES. ITA NO.6429/MUM/2005: (DCIT VS. M/S.S. NARENDRA - A .Y. 2002-03) : 14. GROUND NO. 1 BY THE REVENUE READS AS UNDER : 1. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND O N FACTS IN DIRECTING THE AO TO CONSIDER FOREIGN EXCHANGE RATE DIFFERENCE GAIN OF RS.14,48,734/- PERTAINING TO THE EXPORTS OF EARLIER YEARS ELIGIBLE FOR DEDUCTION U/S.80HHC OF THE I.T. ACT, 1961 WITHOUT A PPRECIATING THE FACTS THAT THE SAID AMOUNT DID NOT FORM PART OF EXP ORT TURNOVER FOR THE ASSESSMENT YEAR UNDER QUESTION AS DEFINED IN CL AUSE (B) OF EXPLANATION BELOW SUB-SECTION (4C) OF SEC.80HHC OF THE I.T. ACT. 14.1 AFTER HEARING BOTH THE SIDES, WE FIND THIS GRO UND IS IDENTICAL TO GROUND NO. IN ITA NO.6432/MUM/2005. WE HAVE ALREADY DECIDED TH E ISSUE AND THE MATTER HAS BEEN RESTORED TO THE FILE OF AO FOR FRESH ADJUD ICATION IN THE LIGHT OF THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN TH E CASE OF PRAKASH L. SAHA (SUPRA). FOLLOWING THE SAME RATIO, THIS GROUND IS A LSO RESTORED TO THE FILE OF AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE DIRECTIONS G IVEN THEREIN. THIS GROUND BY THE REVENUE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURP OSES. 15. GROUND NO. 2 BY THE REVENUE READS AS UNDER : 2. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING THE ASSESSING OFFICER TO DELETE THE ADDIT ION OF RS.1,91,39,922/- WHICH WAS MADE U/S.92CA(3) AS PER ORDER OF THE ADDL. CIT., T.P.2. 15.1 AFTER HEARING BOTH THE PARTIES, WE FIND THIS G ROUND IS IDENTICAL TO GROUND NO.2 IN ITA NO.6432/MUM/2005. WE HAVE ALREADY DECID ED THE ISSUE AND THE GROUND RAISED BY THE REVENUE HAS BEEN RESTORED TO T HE FILE OF AO FOR FRESH ADJUDICATION. FOLLOWING THE SAME RATIO, THIS GROUND BY THE REVENUE IS RESTORED TO ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 12 THE FILE OF AO FOR FRESH ADJUDICATION. THE GROUND R AISED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. 16. GROUND NO.3 BY THE REVENUE IS AS UNDER : 3. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING THE A.O. TO ALLOW THE NETTING OF INTEREST ON FIXED DEPOSITS AGAINST THE INTEREST EXPENDITURE ON BORROWED FUNDS WHILE COMPUTING DEDUCTION U/S.80HHC WITHOUT APPRECIATING THAT THE INTEREST FROM FIXED DEPOSITS BEING IN THE NATURE OF INCOME FROM OTHER SOURCES NO SUCH NETTING IS PERMISSIBLE AS HELD BY VARIOUS COUR T DECISIONS NAMELY : I. SOUTH INDIA SHIPPING CORPN. LTD. VS. CIT 240 ITR 24 (MAD). II. TUTICORIN ALKALI CHEMICALS AND FERTILIZERS LTD. VS. CIT (1997) 227 ITR 172 (SC). III. CIT VS. K.K. DOSHI &CO. 245 ITR 849 (BOM). IV. M/S. VINTEX ENGG. EXPORT PVT.LTD. (A.Y. 1991-92) ITA NO.1640/M/98 DATED 5.10.2000 (MUMBAI TRIBUNAL). V. ITO VS. M/S. TRANSPO INTERNATIONAL WOR KS ITA NO.1170/M/2001 AND ALSO HONBLE SUPREME COURTS DECISION IN THE CA SE OF CIT VS. DR.V.P. GOPINATH (248 ITR 449) WHEREIN THE HONBLE SUPREME COURT OBSERVED THAT THE INTEREST ON LOAN TAKEN FROM THE B ANK DID NOT REDUCE THE AMOUNT RECEIVED BY WAY OF INTEREST ON FI XED DEPOSITS. FURTHER, THE HONBLE PUNJAB AND HARYANA HIGH COURT IN THE JUDGEMENT DATED 07.10.2003 IN THE CASE OF RANI PALI WAL VS. CIT 268 ITR 221 HELD THAT THE AMOUNT OF INTEREST PAID BY TH E ASSESSEE COULD NOT BE DEDUCTED FROM GROSS INTEREST PAID BY THE ASS ESSEE COULD NOT BE DEDUCTED FROM GROSS INTEREST RECEIVED BY THE AS SESSEE FOR THE COMPUTATION OF 80HHC (PURPOSE). 16.1 BOTH THE PARTIES AGREED THAT THIS ISSUE SHOULD BE RESTORED TO THE FILE OF AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE LATEST DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF ASIAN STAR CO.LTD. VIDE ITA NO .200 OF 2009 ORDER DATED 18- 3-2010. WE, THEREFORE, RESTORE THIS ISSUE TO THE FI LE OF AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE ABOVE CITED DECISION OF THE JURIS DICTIONAL HIGH COURT. THE AO SHALL ALSO DECIDE THE APPLICABILITY OF SEC. 57(III) OF TH E I.T. ACT AND DECIDE THE ISSUE AFRESH AND IN ACCORDANCE WITH LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. THIS GROUND BY THE REVENUE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 13 17. IN THE RESULT, THE APPEAL IS ALLOWED FOR STAT ISTICAL PURPOSES. ITA NO.6435/MUM/05 : 18. GROUND NO. 1 BY THE REVENUE READS AS UNDER : 1. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND O N FACTS IN DIRECTING THE AO TO CONSIDER FOREIGN EXCHANGE RATE DIFFERENCE GAIN OF RS.21,17,268/- PERTAINING TO THE EXPORTS OF EARLIER YEARS ELIGIBLE FOR DEDUCTION U/S.80HHC OF THE I.T. ACT, 1961 WITHOUT A PPRECIATING THE FACTS THAT THE SAID AMOUNT DID NOT FORM PART OF EXP ORT TURNOVER FOR THE ASSESSMENT YEAR UNDER QUESTION AS DEFINED IN CL AUSE (B) OF EXPLANATION BELOW SUB-SECTION (4C) OF SEC. 80HHC OF THE I.T. ACT, 1961. 18.1 AFTER HEARING BOTH THE SIDES, WE FIND THIS GRO UND IS IDENTICAL TO GROUND OF APPEAL NO.1 IN ITA NO.6432/MUM/05. WE HAVE ALREADY DECIDED THE ISSUE AND THE MATTER HAS BEEN RESTORED TO THE FILE OF AO FOR FRES H ADJUDICATION IN THE LIGHT OF THE DECISION OF THE SPECIAL BENCH IN THE CASE OF PRAKAS H L. SAHA (SUPRA). FOLLOWING THE SAME RATIO, THIS GROUND IS ALSO RESTORED TO THE FILE OF AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE DIRECTIONS GIVEN THEREIN. THIS GROUND BY THE REVENUE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. 19. GROUND NO.2 BY THE REVENUE READS AS UNDER : 2. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND O N FACTS IN DIRECTING THE ASSESSING OFFICER TO DELETE THE ADDIT ION OF RS.1,83,64,234/- WHICH WAS MADE U/S.92CA(3) AS PER ORDER OF THE ADDL. CIT., T.P.2. 19.1 AFTER HEARING BOTH THE SIDES, WE FIND THIS GRO UND IS IDENTICAL TO GROUND NO.2 IN ITA NO.6432/MUM/05. WE HAVE ALREADY DECIDED THE ISSUE AND THE GROUND RAISED BY THE REVENUE HAS BEEN RESTORED TO THE FILE OF AO FOR FRESH ADJUDICATION. FOLLOWING THE SAME RATIO, THIS GROUND BY THE REVENU E IS RESTORED TO THE FILE OF AO FOR FRESH ADJUDICATION. THE GROUND RAISED BY THE RE VENUE IS ALLOWED FOR STATISTICAL PURPOSES. 20. GROUND NO.3 BY THE REVENUE READS AS UNDER : ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 14 3. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING THE AO TO ALLOW THE NETTING OF INTEREST O N FIXED DEPOSITS AGAINST THE INTEREST EXPENDITURE ON BORROWED FUNDS WHILE COMPUTING DEDUCTION U/S.80HHC WITHOUT APPRECIATING THAT THE I NTEREST FROM FIXED DEPOSITS BEING IN THE NATURE OF INCOME FROM OTHER SOURCES NO SUCH NETTING IS PERMISSIBLE AS HELD BY VARIOUS COUR T DECISIONS NAMELY: I. SOUTH INDIA SHIPPING CORPN. LTD. VS. CIT 240 ITR 24 (MAD) II. TUTICORIN ALKALI CHEMICALS AND FERTILIZERS LTD. VS. CIT (1997) 227 IR 172 (SC). III. CIT VS. K.K. DOSHI & CO. 245 ITR 849 (BOM). IV. M/S. VINTEX ENGG. EXPORT PVT.LTD. (A.Y. 1991-92). V. ITO VS. M/S. TRANSPO INTERNATIONAL WORKS ITA NO.1 170/M/2001 DATED 26.9.2001 (MUMBAI TRIBUNAL). AND ALSO HONBLE SUPREME COURTS DECISION IN THE CA SE OF CIT VS. DR. V.P. GOPINATH (248 ITR 449) WHEREIN THE HONBLE SUPREME COURT OBSERVED THAT THE INTEREST ON LOAN TAKEN FROM THE BANK DID NOT REDUCE THE AMOUNT RECEIVED BY WAY OF INTEREST O N FIXED DEPOSITS. FURTHER, THE HONBLE PUNJAB AND HARYANA HIGH COURT IN THE JUDGEMENT DATED 07.10.2003 IN THE CASE OF RANI PALI WAL VS. CIT 268 ITR 221 HELD THAT THE AMOUNT OF INTEREST PAID B Y THE ASSESSEE COULD NOT BE DEDUCTED FROM GROSS INTEREST RECEIVED BY THE ASSESSEE FOR THE COMPUTATION OF 80HHC (PURPOSE) . 20.1 BOTH THE PARTIES AGREED THAT THIS ISSUE SHOULD BE RESTORED TO THE FILE OF AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE LATEST DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF ASIAN STAR CO. LTD. VIDE ITA N O.200 OF 2009 ORDER DATED 18- 3-2010. WE, THEREFORE, RESTORE THIS ISSUE TO THE FI LE OF AO FOR FRESH ADJUDICATION IN THE LIGHT OF THE LATEST DECISION OF THE JURISDICTIO NAL HIGH COURT. THE AO SHALL ALSO DECIDE THE APPLICABILITY OF SEC. 57(III) OF THE I.T . ACT AND DECIDE THE ISSUE AFRESH AND IN ACCORDANCE WITH LAW AFTER GIVING DUE OPPORTU NITY OF BEING HEARD TO THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. THIS GROU ND BY THE REVENUE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. THE REVENUES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 21. IN THE RESULT, ALL THE 4 APPEALS FILED BY THE R EVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 15 ORDER PRONOUNCED ON THE 30TH DAY OF JUNE, 2010. SD/- SD/- (R.S. PADVEKAR) (R.K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI: 30TH JUNE , 2010. NG: COPY TO : 1. DEPARTMENT. 2. ASSESSEE. 3 CIT(A)-XVII, MUMBAI. 4 CIT, MC-XVI,MUMBAI. 5.DR,L BENCH,MUMBAI. 6.MASTER FILE. (TRUE COPY) BY ORDER, ASST.REGISTRAR, ITAT, MUMBAI. ITA 6429/M/05 & 3 ORS. M/S.S. NARENDRA & 3 ORS. 16 DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 21-06-2010 SR.PS/ 2 DRAFT PLACED BEFORE AUTHOR 24-06-2010 SR.PS/ 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/ 6. KEPT FOR PRONOUNCEMENT ON SR.PS/ 7. FILE SENT TO THE BENCH CLERK SR.PS/ 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER