GIA INDIA LABORATORY P. LTD, MUMBAI V. ITO 14(1)(3), MUMBAI

ITA 6379/MUM/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3939 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: K
• Assessment Year: 2013-2014
• Appeal Filed On: 05-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Transfer pricing; International transaction
• Section: 143(3)

Judgement Text

ITA NO. 6379/MUM/2018 ASSESSMENT YEAR:2013-14 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNA L MUMBAI K BENCH, MUMBAI [CORAM: PRAMOD KUMAR (VICE PRESIDENT) AND RAVISH SOOD (JUDICIAL MEMBER)] ITA NO. 6379/MUM/2018 ASSESSMENT YEAR: 2013-14 GIA INDIA LABORATORY P. LTD. .APPELLANT 10 TH FLOOR, TRADE CENTRE, BANDRA KURLA COMPLEX, BANDRA, MUMBAI-400 051 [PAN: AACCG 9457 G] VS INCOME TAX OFFICER CIRCLE--14(1)(3), MUMBAI ..........RESPO NDENT APPEARANCES BY KETAN VED FOR THE APPELLANT SUSHIL KUMAR MISHRA & MS. SHREEKALA PARDESHI FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : OCTOBER 8, 2021 DATE OF PRONOUNCEMENT : OCTOBER 8, 2021 ORAL ORDER (DICTATED IN THE OPEN COURT) PER PRAMOD KUMAR, VP: BY WAY OF THIS APPEAL, THE ASSESSEE-APPELLANT HAS C HALLENGED THE CORRECTNESS OF THE ASSESSING OFFICERS ORDER DATED 25.10.2017, IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) R.W.S. 144C(1) OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2013-14. 2. GRIEVANCE RAISED BY THE ASSESSEE APPELLANT ARE A S FOLLOWS: 1 : 0 RE.: NON-CONSIDERATION OF THE 'UNILATERAL AD VANCE PRICINA AGREEMENT' [APA] ENTERED INTO BY THE APPELLANT AND THE 'CENTRAL BOAR D OF DIRECT TAXES [CBDT] VIS-A- VIS THE TRANSFER PRICING ADJUSTMENT OF RS.12,50,43, 955/- IN RELATION TO INTERNATIONAL TRANSACTION OF AVAILING OF MANAGEMENT SERVICES:- 1 : 1 THE ASSESSING OFFICER HAS ERRED IN HOLDING T HAT THE MANAGEMENT FEES PAID BY THE APPELLANT DURING THE YEAR TO ITS ASSOCIATED ENTERPR ISE WERE NOT AT AN ARM'S LENGTH AND IN ITA NO. 6379/MUM/2018 ASSESSMENT YEAR:2013-14 PAGE 2 OF 4 THEREBY MAKING AN ADJUSTMENT OF RS.12,50,43,955/- I N RESPECT THEREOF WHILE COMPUTING THE TOTAL INCOME OF THE APPELLANT. 1 : 2 THE APPELLANT SUBMITS THAT CONSIDERING THE F ACTS AND CIRCUMSTANCES OF ITS CASE, THE LAW PREVAILING ON THE SUBJECT AND, IN PARTICULAR, T HE APA ENTERED INTO BY THE APPELLANT WITH THE CBDT, THE INTERNATIONAL TRANSACTION RELATING TO AVAILING OF MANAGEMENT SERVICES WAS AT AN ARM'S LENGTH AND THE STAND TAKEN BY THE ASSESSING O FFICER IN THIS REGARD IS MISCONCEIVED, ERRONEOUS, INCORRECT AND ILLEGAL. 1 : 3 THE APPELLANT SUBMITS THAT THE ASSESSING OFF ICER BE DIRECTED TO DELETE THE ADJUSTMENT OF RS.12,50,43,955/- MADE BY HIM TO THE APPELLANT'S TOTAL INCOME AND TO RECOMPUTE ITS TAXABLE INCOME AND TAX LIABILITY ACCORDINGLY. 2 : 0 RE.: SHORT GRANT OF TAX DEDUCTED AT SOURC E OF RS. 8,74,036/- :- 2 : 1 THE ASSESSING OFFICER HAS ERRED IN GRANTING THE APPELLANT CREDIT FOR TAX DEDUCTED AT SOURCE SHORT BY RS.8,74,036/- WHILE COMPUTING ITS T AX LIABILITY FOR THE YEAR UNDER CONSIDERATION. 2 : 2 THE APPELLANT SUBMITS THAT CONSIDERING THE F ACTS AND CIRCUMSTANCES OF ITS CASE AND THE LAW PREVAILING ON THE SUBJECT IT IS ENTITLED TO FUL L CREDIT OF TAX DEDUCTED AT SOURCE FROM ITS INCOME. 2 : 3 THE APPELLANT SUBMITS THAT THE ASSESSING OFF ICER BE DIRECTED TO GRANT FULL CREDIT FOR TAX DEDUCTED AT SOURCE AND TO RE-COMPUTE ITS TAX LI ABILITY ACCORDINGLY. 3 : 0 RE.; NON-GRANT OF CREDIT OF TAX PAID ON SELF- ASSESSMENT ON 30 3ULV 2018 OF RS. 2,40,55,982/- :- 3:1 THE ASSESSING OFFICER HAS ERRED IN NOT GRANTING THE APPELLANT CREDIT FOR TAX OF RS.2,40,55,982/- PAID ON SELF-ASSESSMENT WHILE COMP UTING ITS TAX LIABILITY FOR THE UNDER CONSIDERATION. 3:2 THE APPELLANT SUBMITS THAT CONSIDERING THE FAC TS AND CIRCUMSTANCES OF ITS CASE AND THE LAW PREVAILING ON THE SUBJECT IT IS ENTITLED TO FUL L CREDIT OF TAX PAID ON SELF-ASSESSMENT FROM ITS INCOME. 3 : 3 THE APPELLANT SUBMITS THAT THE ASSESSING OFF ICER BE DIRECTED TO GRANT FULL CREDIT OF TAX PAID ON SELF-ASSESSMENT AND TO RE-COMPUTE ITS TAX L IABILITY ACCORDINGLY. 3. WHEN THIS APPEAL CAME UP FOR HEARING, SHRI KETAN VED, LEARNED COUNSEL FOR THE ASSESSEE FAIRLY SUBMITTED THAT THE MATTER IS REQUIR ED TO BE SENT BACK TO THE ASSESSING OFFICER SO AS TO EXAMINE THE COMPLIANCE REPORT AND MODIFIED INCOME TAX RETURN, PURSUANT TO THE ADVANCED PRICING AGREEMENT (APA) THAT THE ASSESSEE HAS ENTERED INTO WITH THE GOVERNMENT OF INDIA, WHICH WAS SUBMITTED A DAY AFTER THE IMPUG NED ASSESSMENT ORDER WAS PASSED. HE SUBMITS THAT THE ASSESSEE HAS ALREADY FILED A RECTI FICATION PETITION U/S.154, WHICH IS ALSO PENDING BEFORE THE ASSESSING OFFICER. LEARNED COUNS EL FOR THE ASSESSEE SUBMITS THAT SO FAR AS ITA NO. 6379/MUM/2018 ASSESSMENT YEAR:2013-14 PAGE 3 OF 4 GROUND NO. 1 IS CONCERNED THAT IS THE ONLY PRAYER H E HAS TO MAKE, AND ONCE AGAIN URGES US TO REMIT THE MATTER TO THE FILE OF THE ASSESSING OFFIC ER FOR FRESH ADJUDICATION IN THE LIGHT OF THE COMPLIANCE REPORT, MODIFIED INCOME TAX RETURN PURSU ANT TO THE APA AND SUCH FURTHER CLARIFICATION THE ASSESSING OFFICER MAY SEEK. 4. COMING TO THE SECOND AND THIRD GROUNDS OF APPEAL , ALL THAT THE LEARNED COUNSEL FOR THE ASSESSEE PRAYS IS THE DIRECTION FOR THE ASSESSING O FFICER TO EXAMINE THE ASSESSEES PLEA REGARDING THE SHORT CREDIT FOR TAX DEDUCTED AT SOUR CE AND NON-CREDIT FOR TAX PAID ON SELF ASSESSMENT. IT IS, THUS, PRAYED THAT THE MATTER IS ALSO SENT BACK TO THE ASSESSING OFFICER AND HE MAY ALSO BE DIRECTED TO LOOK INTO THE TWO ABOVE ISS UES RAISED BY THE ASSESSEE. 5. MS. SHREEKALA PARDESHI, LEARNED SENIOR DEPARTMEN TAL REPRESENTATIVE DOES NOT OBJECT TO THE PRAYER SO MADE BY THE ASSESSEE. 6. IN VIEW OF THE ABOVE DISCUSSIONS, AS ALSO BEARIN G IN MIND IN ENTIRETY OF THE CASE, WE DEEM IT FIT AND PROPER TO REMIT THE MATTER TO THE F ILE OF THE ASSESSING OFFICER FOR ADJUDICATION DE NOVO IN THE LIGHT OF OUR ABOVE OBSERVATIONS AND IN TERM S OF THE PRAYERS OF THE ASSESSEE AS ABOVE. ORDERED, ACCORDINGLY. 7. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSE. DICTATED AND PRONOUNCED IN THE OPEN COURT ON 8 TH DAY OF OCTOBER, 2021. SD/- SD/- RAVISH SOOD PRAMOD KUMAR (JUDICIAL MEMBER) (VICE PRESIDENT) MUMBAI, DATED THE 8 TH DAY OF OCTOBER, 2021 ROSHANI, SR. PS COPIES TO: (1) THE APPLICANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR/SR. PS INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, MUMBAI