Schneider Electric Systems India Private Limited, CHENNAI V. DCIT Corporate Circle 2(2), CHENNAI

ITTPA 31/CHNY/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 6071 (ITAT-CHENNAI)
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 30-01-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2012-2013
• Appeal Filed On: 01-04-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S RAMAKRISHNAN
• Keywords: Transfer pricing; Opportunity of being heard; Principle of natural justice; International transaction; Set aside
• Section: 143(3)

Judgement Text

, , IN THE INCOME-TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . , , BEFORE SHRI DUVVURU RL REDDY, JUDICIAL MEMBER & SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ I.T.[TP]A. NO.31/CHNY/2019 / ASSESSMENT YEAR:2012-13 M/S. SCHNEIDER ELECTRIC SYSTEMS INDIA PVT. LTD. [FORMERLY KNOWN AS INVENSYS INDIA PVT. LTD.], SP PLOT #16-20 & 20A, TAMARAI TECH PARK, THIRU VI KA INDUSTRIAL ESTATE, GUINDY, CHENNAI 600 032. [PAN: AABCS8027M] VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 2(2), CHENNAI. ( /APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI SANDEEP BAGMAR, ADVOCATE / RESPONDENT BY : SHRI S. RAMAKRISHNAN, CIT / DATE OF HEARING : 28.01.2020 /DATE OF PRONOUNCEMENT : 30.01.2020 / O R D E R PER DUVVURUL RL REDDY, JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) 5, CHENNAI, DATED 24.01.2019 RELEVANT TO THE ASSESSMENT YEAR 2012-13. BESIDES CHALLENGING VARIOUS ISSUES ON MERITS, THE LD. COUNSEL FOR THE ASSESSEE HAS MAINLY CHALLENGED THE EX-PARTE ORDER PASSED BY THE LD. CIT(A). IT(TP)A NO. 31/CHNY/2019 2 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HAS FILED THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2012-13 ON 29.11.2012 CLAIMING LOSS OF .39,46,75,176/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND AGAINST THE STATUTORY NOTICES; THE ASSESSEE FURNISHED THE DETAILS CALLED FOR. AS PER FORM 3CEB, THE ASSESSEE HAS ENTERED INTO INTERNATIONAL TRANSACTIONS WITH ASSOCIATED ENTERPRISES FOR AN AMOUNT EXCEEDING .15 CRORES. THUS, THE CASE WAS REFERRED TO TRANSFER PRICING OFFICER FOR DETERMINING OF ARMS LENGTH PRICE. AFTER EXAMINING THE DETAILS FURNISHED BY THE ASSESSEE AS WELL AS CONSIDERING THE SUBMISSIONS, THE TPO PASSED ORDER UNDER SECTION 92CA(3) OF THE INCOME TAX ACT, 1961 [ACT IN SHORT] AFTER DETERMINING TP ADJUSTMENT. AGAINST THE DRAFT ASSESSMENT ORDER UNDER SECTION 144C(1) OF THE ACT SERVED ON THE ASSESSEE, IT WAS THE WRITTEN SUBMISSION OF THE ASSESSEE TO PREFER AN APPEAL BEFORE THE LD. CIT(A), THE ASSESSING OFFICER FINALIZED THE ASSESSMENT ORDER UNDER SECTION 143(3) R.W.S. 144C(3) OF THE ACT BY DETERMINING THE TOTAL INCOME OF THE ASSESSEE AT .4,43,85,740/- AFTER MAKING ADDITION TOWARDS TP ADJUSTMENT AS WELL AS INCOME FROM OTHER SOURCES. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). SINCE THERE WAS NO REPRESENTATION FROM ASSESSEES SIDE, THE LD. CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE. 3. ON BEING AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE LD. CIT(A) HAS NOT IT(TP)A NO. 31/CHNY/2019 3 ADJUDICATED THE ISSUES RAISED IN THE APPEAL ON MERITS BY CONSIDERING THE SUBMISSIONS MADE BEFORE HIM AND PRAYED FOR SUITABLE DIRECTIONS FOR ADJUDICATING THE ISSUE ON MERITS AFTER GIVING ONE MORE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE FOR PRESENTING ITS CASE BEFORE THE LD. CIT(A). ON THE OTHER HAND, THE LD. DR DID NOT SERIOUSLY OBJECTED TO THE SUBMISSIONS OF THE LD. COUNSEL. 4. WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. AGAINST THE FINAL ASSESSMENT ORDER UNDER SECTION 143(3) R.W.S. 144C(3) OF THE ACT, THE ASSESSEE PREFERRED FURTHER APPEAL BEFORE THE LD. CIT(A). ON PERUSAL OF THE APPELLATE ORDER, WE FIND THAT THERE WERE NO RESPONSES TO THE NOTICES FIXING FOR HEARING FROM 19.06.2018 TO 17.01.2019. NEARLY TEN OPPORTUNITIES WERE GIVEN TO THE ASSESSEE TO PRESENT ITS CASE BEFORE THE LD. CIT(A), BUT THE ASSESSEE HAS NOT AVAILED OF. EVEN THOUGH THE ASSESSEE ACKNOWLEDGED THE RECEIPT OF NOTICE FIXING THE HEARING ON 07.03.2019, THE ASSESSEE HAS NOT REPRESENTED HIS CASE BEFORE THE LD. CIT(A). SINCE THERE WERE NO EXPLANATORY NOTES OR OTHER DOCUMENTS TO REBUT THE FINDINGS OF THE ASSESSING OFFICER, THE LD. CIT(A) DISMISSED THE APPEAL FILED BY THE ASSESSEE. HOWEVER, IT WAS THE CONTENTION OF THE ASSESSEE THAT THE LD. CIT(A) HAS NOT ADJUDICATED THE ISSUE ON MERITS BY CONSIDERING THE SUBMISSIONS MADE BY THE ASSESSEE. THUS, TO MEET THE ENDS OF IT(TP)A NO. 31/CHNY/2019 4 NATURAL JUSTICE, WE SET ASIDE THE EXPARTE ORDER OF THE LD. CIT(A) AND DIRECT HIM TO DECIDE THE ISSUE ON MERITS IN ACCORDANCE WITH LAW AFTER CONSIDERING THE MATERIAL EVIDENCES AND OTHER DETAILS AS MAY BE SUBMITTED BY THE ASSESSEE BEFORE THE LD. CIT(A) BY GIVING ONE MORE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO FURNISH COMPLETE DETAILS BEFORE THE LD. CIT(A) FOR ADJUDICATING THE ISSUES ON MERITS. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THE 30 TH JANUARY, 2020 AT CHENNAI. SD/- SD/- (S JAYARAMAN) ACCOUNTANT MEMBER (DUVVURUL RL REDDY) JUDICIAL MEMBER CHENNAI, DATED, THE 30.01.2020 VM/- /COPY TO: 1. /APPELLANT, 2. / RESPONDENT, 3. ( )/CIT(A), 4. /CIT, 5. /DR & 6. /GF.