Dy. Commissioner of Income Tax , Circle-16(1), Hyderabad V. Nava Bharat Ventures Limited, Hyderabad

ITA 634/Hyd/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0090 (ITAT-HYDERABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2021
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB-B
• Next Hearing Date: 09-06-2021
• Assessment Year: 2013-2014
• Appeal Filed On: 06-04-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJIV RANKA
• Keywords: Transfer pricing; International transaction; Question of law
• Section: 92C; 10AA; 115JB; 80G; 10B; 119; 22; 92CA; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER I.T.A. NO. 634/HYD/2018 ASSESSMENT YEAR: 2013-14 DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-16(1), HYDERABAD VS M/S.NAVA BHARAT VENTURES LTD. HYDERABAD [PAN: AAACN7327C] (APPELLANT) (RESPONDENT) FOR REVENUE : SHRI RAJIV RANKA, CIT-DR FOR ASSESSEE : SHRI P.V.S.S.PRASAD, AR DATE OF HEARING : 09-06-2021 DATE OF PRONOUNCEMENT : 22-07-2021 O R D E R PER S.S.GODARA, J.M. : THIS REVENUES APPEAL FOR AY.2013-14 ARISES FROM THE CIT(A)-4, HYDERABADS ORDER DATED 29-01-2018 PASSED IN CASE NO.0457 / 2016-17 / ACIT,CIR.16(1) / CIT(A)-4 / HYD / 17-18, IN PROCEEDINGS U/S.143(3) R.W.S.92CA(3) OF THE INCOM E TAX ACT, 1961 [IN SHORT, THE ACT]. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE REVENUE HAS PROPOSED THE FOLLOWING TWIN SUBSTA NTIVE GROUNDS IN THE INSTANT APPEAL: 1.IN THE FACTS AND CIRCUMSTANCES OF THE CASE WHETH ER CIT(A) IS JUSTIFIED IN HOLDING THAT DEPB INCENTIVES ARE TO BE CONSIDERED FOR COMPARABILITY ANALYSIS, IGNORING THE FACT THAT DEPB INCENTIVES ARE EXPORT INCENTIVES GIVEN BY GOVERNMENT AND ARE NOT P ROFITS DERIVED FROM THE BUSINESS DIRECTLY. ITA NO.634/HYD/2018 :- 2 -: 2.IN THE FACTS AND CIRCUMSTANCES OF THE CASE WHETHE R CIT(A) IS JUSTIFIED IN HOLDING THAT DEPB INCENTIVES ARE TO BE CONSIDERED FOR COMPARABILITY ANALYSIS IGNORING THE FACT THAT CONSI DERING DEPB INCENTIVES FOR COMPARABILITY ANALYSIS RESULTS IN SH IFTING OF INCENTIVES TO FOREIGN TERRITORY WHICH IS AGAINST THE OBJECTING OF TRANSFER PRICING LAW. 3. IN THE FACTS AND CIRCUMSTANCES OF THE CASE WHETH ER CIT(A) IS JUSTIFIED IN DELETING THE ADJUSTMENT ON CORPORATE G UARANTEE FEES IGNORING THE FACT THAT NO INDEPENDENT PARTY WILL ST AND GUARANTEE FOR ANY OTHER PARTY CHARGING LESS THAT THE APPROPRIATE FEES/COMMISSION DETERMINED BY THE MARKET CONDITIONS. 4. ANY OTHER GROUND THAT MAY BE URGED AT TIME OF HE ARING. 3. WE ADVERT TO THE FORMER ISSUE OF INCLUSION OF THE ASSESSEES DEPB INCENTIVES IN RULE 10(B)(1)(A)(II) O F INCOME TAX RULES AS AN ADJUSTMENT IN THE COMPARABLE UN-CONTROLLE D PRICE CUP METHOD FOR THE PURPOSE OF ARRIVING AT ARMS LE NGTH PRICE ALP UNDER THE PROVISIONS OF THE ACT. 4. WE START WITH THE BASIC RELEVANT FACTS. THIS ASSESSEE IS ADMITTEDLY A COMPANY, MANUFACTURING FERRO ALLOYS AND SUGAR, FABRICATION OF EQUIPMENT AND GENERATION OF POWER. IT F ILED ITS RETURN ON 29-11-2013 ADMITTING TOTAL INCOME OF RS.173,64,26,290/- AFTER CLAIMING SECTION 80G DEDUCTIO N OF RS.13.10 LAKHS ALONG WITH SECTION 80-IA DEDUCTION OF RS.121,32,88,080/- FOLLOWED BY SECTION 115JB BOOK PR OFITS AT RS.296,63,14,260/-. 5. THE ASSESSING OFFICER NOTICED DURING THE COURSE OF SCRUTINY THAT THE ASSESSEE HAD ENTERED INTO INTERNATIONAL TRANSACTIONS WITH ITS OVERSEAS ASSOCIATED ENTERPRISE AE IN VARIOUS SEGMENTS. HE THUS MADE SECTION 92CA REFEREN CE TO THE TRANSFER PRICING OFFICER TPO TO ASCERTAIN ARMS LEN GTH PRICE ALP THEREOF. THE ASSESSEES INTERNATIONAL TRANSACTION S WITH ITS AES INVOLVED SALE OF SILICO MANGANESE AND FERRO CHR OME. THE ITA NO.634/HYD/2018 :- 3 -: ASSESSEES ENDEAVOUR BEFORE THE TPO WAS TO INCLUDE DP EB AND FPS DECLARED BY THE GOVERNMENT OF INDIA AS AN ADJUSTM ENT UNDER RULE 10B(1)(A)(II). IT QUOTED RULE 10B(A)(VI) A PPLICABLE IN CASE OF THE CUP METHOD THAT THE SAME DULY ACKNOWLEDGED SUCH INCENTIVES AMOUNTING TO DIFFERENCES MATERIALLY AF FECTING THE ALP IN OPEN MARKET. THE TPOS ORDER DT.26-10-201 6 QUOTED GOODYEAR INDIA LTD. 152 TTDJ 458 (DEL) TO HOLD THAT EXPORT INCENTIVES LIKE DPEB ETC. ARE AVAILABLE ONLY I N INDIA WHICH COULD NOT BE PASSED IN FAVOUR OF ANY ENTITY OUTS IDE THE TERRITORY. HE FURTHER APPEARS TO HAVE CONSIDERED TRIBUNA LS YET ANOTHER DECISION IN ITA NO.6539/MUM/2009 DT.19-11-201 2 IN CASE OF CIT VS. WELSPUN ZUCCHI TEXTILES LIMITED (391 ITR 211) DECIDING THE ISSUE IN ASSESSEES FAVOUR AS AN ADJUSTM ENT. THE ASSESSING OFFICER PASSED HIS DRAFT ASSESSMENT DT.15-11 -2016 FOLLOWED THE IMPUGNED ASSESSMENT DT.09-01-2017 IN VIEW OF THE FACT THAT THIS TAXPAYER HAD NOT PREFERRED OBJECTIONS BE FORE THE DRP. THE ASSESSING OFFICERS ASSESSMENT WENT BY THE FOREGOING TPOS PROPOSING ALP ADJUSTMENT RELATING TO SALE OF SILICO MANGANESE AND FERRO CHROME OF RS.2,50,63,257/- AGAINST THE ASSESSEE. 6. THE ASSESSEE PREFERRED APPEAL. THE CIT(A) HAS D IRECTED THE ASSESSING OFFICER TO VERIFY AND CONSIDER THE FOREG OING DPEB BENEFIT FOR COMPARABILITY ANALYSIS AND RE-WORK THE CONSEQUENTIAL ADJUSTMENT OF THE SELLING PRICE AS UNDER: 5. I HAVE CAREFULLY CONSIDERED THE ASSESSMENT ORDE R, FACTS OF THE CASE AND SUBMISSIONS FURNISHED BY THE APPELLANT. TH E ASSESSING OFFICER MADE THE ADDITION IN TWO ASPECTS VIZ., SHOR TFALL IN RESPECT OF SALE OF SILICO MANGANESE AT RS.2,50,63,257/- AND IN RESPECT OF CORPORATE GUARANTEE FEE AT RS.3,51,06,335/-, TOTALI NG TO RS. 6,01,69,592/- AS ADJUSTMENT U/S 92CA(3) OF THE I.T. ACT, AS DETERMINED BY THE TPO. IN THIS REGARD, THE SUBMISSI ONS MADE BY THE ITA NO.634/HYD/2018 :- 4 -: APPELLANT COMPANY WERE VERIFIED AND IT IS NOTICED T HAT THE APPELLANT COMPANY HAS RELIED UPON THE HON'BLE BOMBAY HIGH COU RT DECISION IN THE CASE OF CIT VS. WELSPUN ZUCCHI TEXTILES LIMITED (391 ITR 211), WHEREIN IT WAS HELD THAT DEPB BENEFITS ARE TO BE CO NSIDERED FOR COMPARISON OF PRICES. FURTHER, AS PER THE APPELLANT 'S SUBMISSIONS, HON'BLE ITAT, DELHI BENCH, IN THE CASE OF DEGANIA M EDICAL DEVICES (P) LTD., VS. ACIT, WHEREIN IT WAS HELD THAT DEPB/DUTY DRAWBACK ARE PART OF THE OPERATING PROFITS SHOULD NOT BE EXCLUDE D FOR THE PURPOSE OF COMPARABILITY ANALYSIS. THEREFORE, AFTER CONSIDERIN G THE SUBMISSIONS OF THE APPELLANT AND CASE LAWS RELIED UPON, THE ASS ESSING OFFICER IS DIRECTED TO VERIFY AND CONSIDER THE DEPB BENEFIT FO R COMPARABILITY ANALYSIS AND REWORK OUT THE ADJUSTMENT ON ACCOUNT O F SELLING PRICE. 7. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO RIVAL PLEADINGS QUA THE ASSESSEES CASE THAT ITS DPEB BENEFITS DERIVED FROM SALE OF SILICO MANGANESE FERRO CHROME DESERVE TO BE CONSIDERED AS AN ADJUSTMENT UNDER RULE 10B(1)(A)(I I) OF THE INCOME TAX RULES. LEARNED COUNSEL HAS ALSO FILED A WRITTEN NOTE WITH CATENA OF CASE LAW HONBLE BOMBAY HIGH COUR T (SUPRA), (2020) 119 TAXMANN.COM 401 (BANGALORE-TRIB) REITZEL INDIA (P.) LTD., VS. DCIT, (2019) 101 TAXMANN.COM 325 (PUNE- TRIB), CUMMINS INDIA LTD., VS. DCIT, (2018) 97 TAXMANN.COM 494 (KOLKATA - TRIB) DCIT VS. JJ EXPORTERS LTD. HOLDIN G THAT SINCE DPEB BENEFITS ARE EXPORT INCENTIVES FORMING PAR T OF OPERATING REVENUES, THE SAME ALSO DESERVE TO BE CONSID ERED AS AN ADJUSTMENT UNDER RULE 10B OF THE RULES. 8. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO FOREGO ING RIVAL PLEADINGS AND FIND NO REASON TO AGREE WITH THE ASSESSEES STAND SUPPORTING THE CIT(A)S FOREGOING CONCLUSION. THIS IS FOR THE PRECISE REASON THAT WE ARE DEALING WITH CHAPTER-X OF THE ACT IN THE NATURE OF (A) SPECIAL PROVISION RELATING TO AVOIDANCE OF ACT INTRODUCED AS AN ANTI-AVOIDANCE MEASURE BY THE LEGISLATURE. SECTION 92(1) THEREUNDER STIPULATES THAT ANY INCOME ARISING FROM AN INTERNATIONAL TRANSACTI ON SHALL ITA NO.634/HYD/2018 :- 5 -: BE COMPUTED HAVING REGARD TO THE ARMS LENGTH PRICE. S ECTION 92C PRESCRIBES THE DETAILED MECHANISM FOR ALP COMPUTATI ON. SUB-SECTION (4) 1 ST PROVISO THEREOF ENVISAGES THAT NO DEDUCTION U/S.10A [OR SECTION 10AA] OR SECTION 10B ARE UNDER C HAPTER-VI SHALL BE ALLOWED IN RESPECT OF THE AMOUNT OF INCOME BY WHICH THE TOTAL INCOME OF THE ASSESSEE IS ENHANCED AFTER COMPU TATION OF INCOME UNDER THIS SUB-SECTION. 8.1. THE FOREGOING STATUTORY PROVISO IN SECTION 92C(4 ) ALSO FORMED SUBJECT MATTER OF ADJUDICATION IN THIS TRIBUNALS SPECIAL BENCHS DECISION DOSHI SERVICES P. LTD. VS. DCIT (TS ) 1086- ITAT-2019 (AHD) WHEREIN THE ASSESSEES ENDEAVOUR SEE KING TO APPLY PURPOSIVE CONSTRUCTION STANDS DECLINED ON 24-10 -2019. 8.2. COUPLED WITH THIS, THE LEGISLATURE HAS ALSO INVE STED A DEFINITION CLAUSE IN SECTION 92F(II) THAT ARMS LENGTH PRICE MEANS A PRICE WHICH IS APPLIED OR PROPOSED TO BE AP PLIED IN A TRANSACTION BETWEEN PERSONS OTHER THAN ASSOCIATED ENTER PRISES IN UN-CONTROLLED CONDITIONS. LEARNED COUNSEL IS FAI R ENOUGH IN HIGHLIGHTING THE ISSUE BEFORE US AS TO WHETHER THE DPE B BENEFITS DERIVED FROM THE CORRESPONDING SCHEME OUGHT TO BE CONSIDERED FOR ADJUSTMENT OR NOT UNDER RULE 10B(1)(A)( III) BEING IN THE NATURE OF A DIFFERENCE MATERIALLY AFFECTING THE PRICE IN OPEN MARKET. HONBLE APEX COURTS LATEST FULL BENCH D ECISION IN COMMISSIONER OF CUSTOMS VS. DILIP KUMAR (2018) 9 SCC 1 (FB)(SC) HOLDS THAT TAXING AND AN EXEMPTION PROVISIONS HAVE TO BE STRICTLY CONSTRUED AND BENEFIT OF DOUBT IN SUCH AN IN STANCE GOES TO THE ASSESSEE AND REVENUE; RESPECTIVELY. WE AR E UNABLE TO LOOSE SIGHT OF THE FACT THAT CHAPTER-X IS SPECIAL AS AGAINST ALL OTHER GENERAL PROVISIONS INCLUDING SECTION(S) 10 , 10A, 10AA ITA NO.634/HYD/2018 :- 6 -: AND 10B ETC; AS THE CASE MAY BE. WE CITE LEGAL MAXIM GENERALIA SPEIALIBUS NON-DEROGANT MEANING THAT A G ENERAL PROVISION DOES NOT APPLY AT THE COST OF THE SPECIAL ONE OR THE FORMER OF THEM MUST MAKE WAY FOR THE LATTER; RESPECTIVELY ; AND, ARE OF THE OPINION THAT THE ASSESSEES ARGUMENTS GO AGA INST ARMS LENGTH PRICE DEFINED AS A PRICE WHICH IS APP LIED OR PROPOSED TO BE APPLIED IN A TRANSACTION BETWEEN PERSON S OTHER THAN ASSOCIATE ENTERPRISES, IN UNCONTROLLED CONDITIONS ONLY. SO FAR AS THE ASSESSEES CASE THAT VARIOUS JUDICIAL PRECEDENTS (SUPRA) HAVE ALREADY DECIDED THE ISSUE IN ITS FAVOUR, WE QUOTE THE FOREGOING HONBLE APEX COURTS DECISION B INDING ON ALL THE COURTS WITHIN THE TERRITORY OF INDIA AS PER ARTICLE 141 OF THE CONSTITUTION AND HOLD THAT NONE OF THEM CONSI DER THE LEGISLATURE SCHEME IN CHAPTER-X (SUPRA). AND THAT DEVIATES THEREFROM WOULD NOT ONLY VIOLATES THE SAME BUT ALSO WOUL D AMOUNTS TO NON-COMPLIANCE OF BETWEEN PERSONS IN SE CTION 92F. 9. HON'BLE JURISDICTIONAL HIGH COURTS FULL BENCH DE CISION IN (1993) 202 ITR 333 (AP) CIT VS. B.R.CONSTRUCTIONS AL SO HOLDS THAT A JUDICIAL PRECEDENT CEASES TO BE BINDING IN THE FO LLOWING CONDITIONS: 37. THE EFFECT OF BINDING PRECEDENTS IN INDIA IS T HAT THE DECISIONS OF THE SUPREME COURT ARE BINDING ON ALL THE COURTS. INDEED, ARTICL E 141 OF THE CONSTITUTION EMBODIES THE RULE OF PRECEDENT. ALL THE SUBORDINATE COURTS ARE BOUND BY THE JUDGMENTS OF THE HIGH COURT. A SINGLE JUDGE OF A HI GH COURT IS BOUND BY THE JUDGMENT OF ANOTHER SINGLE JUDGE AND A FORTIORI JUD GMENTS OF BENCHES CONSISTING OF MORE JUDGES THAN ONE. SO ALSO, A DIVISION BENCH OF A HIGH COURT IS BOUND BY JUDGMENTS OF ANOTHER DIVISION BENCH AND FULL . A SI NGLE JUDGE OR BENCHES OF HIGH COURTS CANNOT DIFFER FROM THE EARLIER JUDGMENTS OF CO-ORDINATE JURISDICTION MERELY BECAUSE THEY HOLD A DIFFERENT VIEW ON THE QUESTION OF LAW FOR THE REASON THAT CERTAINTY AND UNIFORMITY IN THE ADMINISTRATION OF J USTICE ARE OF PARAMOUNT IMPORTANCE. BUT, IF THE EARLIER JUDGMENT IS ERRONEO US OR ADHERENCE TO THE RULE OF PRECEDENTS RESULTS IN MANIFEST INJUSTICE, DIFFERING FROM THE EARLIER JUDGMENT WILL BE PERMISSIBLE. WHEN A DIVISION BENCH DIFFERS FROM THE JUDGMENT OF ANOTHER DIVISION ITA NO.634/HYD/2018 :- 7 -: BENCH, IT HAS TO REFER THE CASE TO A FULL BENCH. A SINGLE JUDGE CANNOT DIFFER FROM A DECISION OF A DIVISION BENCH EXCEPT WHEN THAT DECIS ION OR A JUDGMENT RELIED UPON IN THAT DECISION IS OVERRULED BY A FULL BENCH OR TH E SUPREME COURT, OR WHEN THE LAW LAID DOWN BY A FULL BENCH OR THE SUPREME COURT IS INCONSISTENT WITH THE DECISION. 38. IT MAY BE NOTICED THAT PRECEDENT CEASES TO BE A BINDING PRECEDENT - (I) IF IT IS REVERSED OR OVERRULED BY A HIGHER COURT, (II) WHEN IT IS AFFIRMED OR REVERSED ON A DIFFERENT GROUND, (III) WHEN IT IS INCONSISTENT WIT H THE EARLIER DECISIONS OF THE SAME RANK, (IV) WHEN IT IS SUB SILENTIO, AND (V) WHEN IT IS RENDERED PER INCURIAM. 39. IN PARAGRAPH 578 AT PAGE 297 OF HALSBURY'S LAWS OF ENGLAND, FOURTH EDITION, THE RULE OF PER INCURIAM IS STATED AS FOLLOWS : 'A DECISION IS GIVEN PER INCURIAM WHEN THE COURT HA S ACTED IN IGNORANCE OF A PREVIOUS DECISION OF ITS OWN OR OF A COURT OF CO-OR DINATE JURISDICTION WHICH COVERED THE CASE BEFORE IT, IN WHICH CASE IT MUST DECIDED W HICH CASE TO FOLLOW; OR WHEN IT HAS ACTED IN IGNORANCE OF A HOUSE OF LORDS DECISION , IN WHICH CASE IT MUST FOLLOW THAT DECISION; OR WHEN THE DECISION IS GIVEN IN IGN ORANCE OF THE TERMS OF A STATUTE OR RULE HAVING STATUTORY FORCE.' 40. IN PUNJAB LAND DEVELOPMENT AND RECLAMATION CORP ORATION LTD. V. PRESIDING OFFICER, LABOUR COURT , THE SUPREME COURT EXPLAINED THE EXPRESSION 'PER INCURIAM' THUS (AT PAGE 36 OF 77 FJR) : 'THE LATIN EXPRESSION PER INCURIAM MEANS THROUGH IN ADVERTENCE. A DECISION CAN BE SAID GENERALLY TO BE GIVEN PER INCURIAM WHEN THE SU PREME COURT HAS ACTED IN IGNORANCE OF A PERVIOUS DECISION OF ITS OWN OR WHEN A HIGH COURT HAS ACTED IN IGNORANCE OF A DECISION OF THE SUPREME COURT.' 42. AS HAS BEEN NOTICED ABOVE, A JUDGMENT CAN BE SA ID TO BE PER INCURIAM IF IT IS RENDERED IN IGNORANCE OR FORGETFULNESS OF THE PROVI SIONS OF A STATUTE OR A RULE HAVING STATUTORY FORCE OR A BINDING AUTHORITY. BUT, IF THE PROVISION OF THE ACT WAS NOTICED AND CONSIDERED BEFORE THE CONCLUSION ARRIVE D AT, ON THE GROUND THAT IT HAS ERRONEOUSLY REACHED THE CONCLUSION THE JUDGMENT CAN NOT BE IGNORED AS BEING PER INCURIAM. IN SALMOND ON JURISPRUDENCE, TWELFTH EDIT ION, AT PAGE 151, THE RULE IS SATED AS FOLLOWS : 'THE MERE FACT THAT (AS IS CONTENDED) THE EARLIER C OURT MISCONSTRUED A STATUTE, OR IGNORED A RULE OF CONSTRUCTION, IS NO GROUND FOR IM PUGNING THE AUTHORITY OF THE PRECEDENT. A PRECEDENT ON THE CONSTRUCTION OF A STA TUTE IS AS MUCH BINDING AS ANY OTHER, AND THE FACT THAT IT WAS MISTAKEN IN ITS REA SONING DOES NOT DESTROY ITS BINDING FORCE.' 43. IN CHOUDHRY BROTHERS' CASE , AS NOTICED ABOVE, THE DIVISION BENCH TREATED THE JUDGMENT IN CH. ATCHAIAH'S CASE , AS PER INCURIAM O N THE GROUND THAT THE EARLIER DIVISION BENCH DID NOT NOTICE THE SIGNIFICANT CHANG ES THE CHARGING SECTION 3 HAS UNDERGONE BY THE OMISSION OF THE WORDS 'OR THE PART NERS OF THE FIRM OR THE MEMBERS OF THE ASSOCIATION INDIVIDUALLY'-. IN OUR VIEW, THI S CANNOT BE A GROUND TO TREAT AN EARLIER JUDGMENT AS PER INCURIAM. THE CHANGE IN THE PROVISIONS OF THE ACT WAS PRESENT IN THE MIND OF THE COURT WHICH DECIDED CH. ATCHAIAH'S CASE . MERELY BECAUSE THE CONCLUSION ARRIVED AT ON CONSTRUING THE PROVISIONS OF THE CHARGING ITA NO.634/HYD/2018 :- 8 -: SECTION UNDER THE OLD ACT AS WELL AS UNDER THE NEW ACT DID NOT HAVE THE CONCURRENCE OF THE LATTER BENCH, THE EARLIER JUDGME NT CANNOT BE CALLED PER INCURIAM. 44. THOUGH A JUDGMENT RENDERED PER INCURIAM CAN BE IGNORED EVEN BY A LOWER COURT, YET IT APPEARS THAT SUCH A COURSE OF ACTION WAS NOT APPROVED BY THE HOUSE OF LORDS IN CASSELL AND CO. LTD. V. BROOME [1972] 1 AL L ER 801, WHEREIN THE HOUSE OF LORDS DISAPPROVED THE JUDGMENT OF THE COURT OF A PPEAL TREATING AN EARLIER JUDGMENT OF THE HOUSE OF LORDS AS PER INCURIAM. LOR D HAILSHAM OBSERVED (AT PAGE 809) : 'IT IS NOT OPEN TO THE COURT OF APPEAL TO GI VE GRATUITOUS ADVICE TO JUDGES OF FIRST INSTANCE TO IGNORE DECISIONS OF THE HOUSE OF LORDS IN THIS WAY.' 45. IT IS RECOGNISED THAT THE RULE OF PER INCURIAM IS OF LIMITED APPLICATION AND WILL BE APPLICABLE ONLY IN THE RAREST OF RARE CASES. THE REFORE, WHEN A LEARNED SINGLE JUDGE OR A DIVISION BENCH DOUBTS THE CORRECTNESS OF AN OTHERWISE BINDING PRECEDENT, THE APPROPRIATE COURSE WOULD BE TO REFER THE CASE TO A DIVISION BENCH OR FULL BENCH, AS THE CASE MAY BE, FOR AN AUTHORITATIV E PRONOUNCEMENT ON THE QUESTION INVOLVED AS INDICATED ABOVE. THE ABOVE-SAI D TWO QUESTIONS ARE ANSWERED AS INDICATED ABOVE. 46. IN THE RESULT, THE QUESTIONS REFERRED TO US ARE ANSWERED ACCORDINGLY. WE CONCLUDE IN THIS FACTUAL AND LEGAL BACKDROP THAT THE ASSESSEES ARGUMENT SEEKING TO INCLUDE DEPB AS AN ADJUSTMENT FOR ALP COMPUTATION BECAUSE IT IS IN THE NATU RE OF AN OPERATING INCOME, OUGHT NOT BE ACCEPTED AS IT TEND S TO HAVE AN OVERRIDING EFFECT ON APPLICATION OF CHAPTER-X OF THE ACT AS PER STRICTER INTERPRETATION RULE. WE THEREFORE ACCEPT THE REVENUES INSTANT FORMER SUBSTANTIVE GRIEVANCE. 9.1. NEXT COMES LATTER ISSUE OF CORPORATE GUARANTEE ADJUSTMENT OF RS.3,51,06,335/- DELETED IN THE CIT(A)S DETAILED DISCUSSION AS UNDER: 5.1 WITH REGARD TO ADJUSTMENT ON AMOUNT OF SHORTFA LL IN CORPORATE GUARANTEE COMMISSION OF RS.3,51,06,335/-, AFTER CON SIDERING THE SUBMISSIONS OF THE APPELLANT COMPANY AND ALSO BY FO LLOWING EARLIER ORDER IN THE APPELLANTS OWN CASE FOR THE AY.2011-1 2, WHEREIN I DECIDED THE ISSUE IN FAVOUR OF THE APPELLANT COMPAN Y BY OBSERVING THAT, THE TRANSFER PRICING OFFICER HAD CHARGED COR PORATE GUARANTEE COMMISSION @ 2% WHICH IS HIGHER THAN THE APPELLANT CHARGED. SINCE THE APPELLANT HAS CHARGED A REASONABLE CORPORATE GU ARANTEE COMMISSION I.E. @ 0.875% ARE MORE THAN THE TRIBUNAL S ALLOWED. THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFIC ER IS HEREBY ITA NO.634/HYD/2018 :- 9 -: DELETED. THEREFORE, THE ADDITION MADE BY THE ASSES SING OFFICER IS DELETED. 9.2. IT HAS COME ON RECORD THAT THE ASSESSEE HAD ITSELF RECORDED COMPARABLE GUARANTEE COMMISSION @8.75% I.E. MUCH MORE THAN THAT THAT DECIDED BY THE TRIBUNAL (SUPRA). WE THEREFORE ADOPT JUDICIAL CONSISTENCY AND DECLINE REVEN UES INSTANT LATTER SUBSTANTIVE GROUND FOR THIS PRECISE REAS ON ALONE. NO OTHER ARGUMENT HAS BEEN RAISED BEFORE US. 10. THIS REVENUES APPEAL IS PARTLY ALLOWED IN ABOVE TERMS. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND JULY, 2021 SD/- SD/- (LAXMI PRASAD SAHU) (S.S.GO DARA) ACCOUNTANT MEMBER JUDICIAL MEMB ER HYDERABAD, DATED: 22-07-2021 TNMM ITA NO.634/HYD/2018 :- 10 -: COPY TO : 1.THE DY.COMMISSIONER OF INCOME TAX, CIRCLE-16(1), HYDERABAD. 2.M/S.NAVA BHARAT VENTURES LTD., 6-3-1109/1, 3 RD FLOOR, RAJBHAVAN ROAD, SOMAJIGUDA, HYDERABAD. 3.CIT(APPEALS)-4, HYDERABAD. 4.PR.CIT-4, HYDERABAD. 5.D.R. ITAT, HYDERABAD. 6.GUARD FILE.