VFS GLOBAL SERVICES P.LTD, MUMBAI V. DCIT RG 1(3)(2), MUMBAI

ITA 893/MUM/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93193 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: K
• Assessment Year: 2010-2011
• Appeal Filed On: 09-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JI TENDRA YADAV
• Keywords: Transfer pricing; International transaction

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL K BENCH, MUMBAI . . , , , BEFORE SHRI A.D. JAIN , JUDICIAL MEMBER AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO . 893/MUM/2015 ( / ASSESSMENT YEAR : 2010 - 11 M/S. VFSGLOBAL SERVICES PVT. LTD., 9 TH FLOOR, TOWER A, URMI ESTATE, GANPAT KADAM,LOWER PAREL, MUMBAI - 400 013 / VS. THE DCIT - RANGE 1(3)2, AAYAKAR BHAVAN, MUMBAI ./ ./ PAN/GIR NO. : AACCC 7513P ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI NIRAJ SHETH / RESPONDENT BY : SHRI JITENDRA YADAV / DATE OF HEARING : 15 . 0 7 .2015 / DATE OF PRONOUNCEMENT : 15 .0 7 .2015 / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE DIRECTIONS ISSUED U/S. 144C(5) OF THE ACT BY THE DISPUTE RESOLUTION PANEL - II, MUMBAI AND BY ORDER DT. 29.10.2014. 2. GROUND NO. 1 IS OF GENERAL IN NATURE AND NEEDS NO SEPARATE ADJUDICATION. ITA. NO S . 2443 & 2444/M/2013 2 3. GROUND NO. 2 RELATES TO THE ADJUSTMENTS OF RS. 7,80,06,843/ - RELATING TO INTERNATIONAL TRANSACTION OF PROVISION OF UK VISA PROCESSING SERVICES. 3.1. AT THE VERY OUTSET, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT AN IDENTICAL ISSUE AROSE IN A.Y. 2008 - 09 AND THE MATTER TRAVELLED UPTO THE TRIBUNAL AND THE TRIBUNA L IN ITA NO. 7316/M/2013 HAS CONSIDERED AN IDENTICAL ISSUE QUA GROUND NO. 3 OF THAT APPEAL AND AFTER CONSIDERING THE FACTS AND THE SUBMISSIONS, THE TRIBUNAL AT PARA - 5.3.1 HELD AS UNDER: AS FAR AS THE COMPARABILITY OF THE PRICE CHARGED BY THE ASSESSEE FR OM ITS ANOTHER AE IS CONCERNED THE SAME CANNOT BE CONSIDERED AS A COMPARABLE UNCONTROLLED PRICE AS PER THE PROVISIONS OF TRANSFER PRICING PROVIDED UNDER THE INCOME TAX ACT AS WELL AS RULES. AN IDENTICAL ISSUE HAS BEEN DECIDED BY THE IIIRD MEMBER DECISION IN THE CASE OF TECHNIMONT ICB INDIA PVT. LTD. (SUPRA) AND HELD THAT A PRICE CHARGED TO A RELATED PARTY CANNOT BE CONSIDERED AS UNCONTROLLED COMPARABLE PRICE FOR THE PURPOSE OF DETERMINATION OF ALP IN RESPECT OF INTERNATIONAL TRANSACTION WITH ANOTHER AE. T HEREFORE, THE PRICE CHARGED BY THE ASSESSEE FROM ITS AE AT NEPAL CANNOT BE CONSIDERED AS COMPARABLE AND ALP IN RESPECT OF THE INTERNATIONAL TRANSACTION WITH AE AT MAURITIUS. THE ASSESSEE FURTHER POINTED OUT THAT THE PRICE CHARGED FROM THE AE AT NEPAL INCL UDES COURIER CHARGES, BANK CHARGES ETC. THEREFORE, THE SAID AMOUNT CANNOT BE COMPARED WITH THE AMOUNT RECEIVED FROM ITS AE AS ALP IN RESPECT OF THE INTERNATIONAL TRANSACTION WITH ANOTHER AE WHICH IS NOT PERMISSIBLE UNDER TRANSFER PRICING PROVISIONS AND IN VIEW OF THE IIIRD MEMBER DECISION IN THE CASE OF TECHNIMONT ICB INDIA PVT. LTD(SUPRA), WE SET ASIDE THIS ISSUE TO THE RECORD OF TPO/AO TO DECIDE THE SAME AFTER CONSIDERING THE RELEVANT FACTS AND RECORD TO BE FILED BY THE ASSESSEE. THE ASSESSEE IS DIRECT ED TO CO - OPERATE WITH THE AO/TPO AND PROVIDE THE NECESSARY DETAILS AND INFORMATION IN THIS RESPECT. 3.2. AS NO DISTINGUISHING DECISION/FACTS HAVE BEEN BROUGHT BEFORE US, RESPECTFULLY FOLLOWING THE DECISION OF THE CO - ORDINATE BENCH (SUPRA), WE ITA. NO S . 2443 & 2444/M/2013 3 SET ASIDE T HIS ISSUE TO THE RECORD OF TPO/AO TO DECIDE THE SAME IN THE LINE OF THE DIRECTIONS GIVEN BY THE TRIBUNAL IN A.Y. 2008 - 09. 4. WITH THIS GROUND NO. 3 BECOME OTIOSE. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. OR DER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON 15TH JU LY , 2015 SD/ - SD/ - ( A.D. JAIN ) (N.K. BILLAIYA) /JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 15 TH JU LY , 2015 . . ./ RJ , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI