YCH Logistics (India) Pvt. Ltd., Kancheepuram V. ACIT, CHENNAI

MA 218/CHNY/2016

• Counselvise Citation: [2017] 124 COUNSELVISE.COM (IT) 5570 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 25 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-04-2017
• Appeal Filed By: Assessee
• Bench Allotted: D
• Next Hearing Date: 06-01-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 10-08-2016
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH
• Keywords: Transfer pricing; Opportunity of being heard; Principle of natural justice
• Section: 10AA

Judgement Text

, , IN THE INCOME - TAX APPELLATE TRIBUNAL D BENCH, CHENNAI , . , BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY, JUDICIAL MEMBER M.P. NO. 218/MDS/2016 [IN I.T.A.NO. 322/MDS/2016 ] / ASSESSMENT YEAR :20 11 - 1 2 YCH LOGISTICS (INDIA) PRIVATE LIMITED, PLOT NO. DV1, SIPCOT HI - TECH SEZ PHASE II, SIRUMANGADU VILLAGE, SRIPERUMBUDUR TALUK, KANCHEEPURAM DISTRICT, TAM IL NADU 602 105. [PAN: A AACY2873L ] VS. THE DEPUTY COMMISSIONER OF INCOME TAX , CORPORATE CIRCLE 3 ( 2 ), CHENNAI. ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI RAGHUNATHAN SAMPATH, ADVOCATE / RESPONDENT BY : SHRI A.V. SREEKANTH , J CIT / DATE OF HEARING : 0 6 . 0 1 .201 7 / DATE OF P RONOUNCEMENT : 04 . 0 4 .201 7 / O R D E R PER DUVVURU RL REDDY , JUDICIAL MEMBER : BY MEANS OF PRESENT MISCELLANEO US PETITION, THE ASSESSEE SEEKS TO GET RECALLED THE ORDER PASSED BY THE TRIBUNAL IN I.T.A. NO. 322/ MDS/201 5 DATED 30 .06.2016 RELEVANT TO THE ASSESSMENT YEAR 2011 - 12 . BY REFERRING TO THE PETITION, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT IN THE OR IGINAL APPEAL AGAINST THE GROUND NO.2, THE ASSESSEE HAS RAISED THE ISSUE OF DOWNWARD ADJUSTMENT WITH RESPECT TO TRANSFER PRICING TRANSACTIONS AND M.P . NO . 2 18 /M/ 16 2 DECIDED THE ISSUE AGAINST THE ASSESSEE ON THE GROUND THAT THE ASSESSEE HAS NOT FILED COPY OF THE AGREEMENT WIT H YCH, SINGAPORE. IN THIS CONNECTION, BY REFERRING TO THE AFFIDAVIT FILED BY THE ASSESSEE, THE LD. COUNSEL HAS SUBMITTED THAT AT THE TIME OF FILING THE APPEAL BEFORE THE REGISTRY OF TRIBUNAL, THE ASSESSEE HAS FILED PAPER BOOK I ON 29.03.2016 AND ADDITIONAL PAPER BOOK ON 31.03.2016, BUT INADVERTENTLY, THE SAME WERE NOT PLACED BEFORE THE BENCH AND THEREFORE, THE BENCH HAD NO OCCASION TO PERUSE THE DETAILS FILED BY THE ASSESSEE IN THE FORM OF ABOVE PAPER BOOKS AND PLEADED THAT THE ORDER OF THE TRIBUNAL MAY BE RECALLED AND THE ASSESSEE MAY BE GIVEN AN OPPORTUNITY TO PRESENT ITS CASE BEFORE THE BENCH IN SUPPORT OF RELEVANT AGREEMENTS ENTERED INTO. 2. ON THE OTHER HAND, THE LD. DR DID NOT SERIOUSLY OBJECT TO THE SUBMISSIONS OF THE ASSESSEE. 3. WE HAVE HEARD BOTH SIDES AND PERUSED THE ORDER OF THE TRIBUNAL. VIDE ORDER DATED 30.06.2016, AT PARA 8, THE TRIBUNAL HAS OBSERVED AS UNDER: 8. DURING THE COURSE OF DRP PROCEEDINGS, THE LD. COUNSEL FOR THE ASSESSEE HAS REITERATED THE SUBMISSIONS AS MADE BEFORE THE TPO. DURING THE COURSE OF HEARING THE ASSESSEE WAS ASKED TO PRODUCE THE AGREEMENT WITH YCH SINGAPORE WHICH WOULD BE THE BASIS FOR PAYMENT OF MANAGEMENT SUPPORT SERVICE BY THE ASSESSEE. HOWEVER, THE ASSESSEE COULD NOT PRODUCE THE AGREEMENT EITHER BEFORE THE LD. DRP OR EVEN BEFORE THE TRIBUNAL . IT WAS SUBMITTED THAT THE AMOUNT OF MANAGEMENT SUPPORT SERVICES WAS PAID BY ASSESSEE AS ALLOCATED TO IT BY THE SINGAPORE AE. BUT, NO DETAILS OF SPECIFIC SERVICES OR THE BASIS OF ALLOCATION COULD BE FURNISHED BY THE ASSESSE E IN SUPPORT OF ITS CLAIM. THEREFORE, AFTER CONSIDERATION OF ALL ASPECTS, THE DRP WAS OF THE M.P . NO . 2 18 /M/ 16 3 OPINION THAT THE DECISION OF THE TPO CANNOT BE FAULTED WITH. THE APPROACH OF TPO TO ADOPT TRANSACTION SPECIFIC ANALYSIS ALSO CANNOT BE WRONGED AS THIS APPROACH CON FIRMS TO THE BASIC PRINCIPLES OF COMPARABILITY ANALYSIS. CONSEQUENTLY, THE OBJECTION OF THE ASSESSEE WAS REJECTED BY THE DRP. IN VIEW OF THE ABOVE, WE FIND NO INFIRMITY IN THE ORDER PASSED BY THE LD. DRP AND DISMISS THE GROUND RAISED BY THE ASSESSEE. FRO M THE ABOVE, IT IS CLEAR THAT THE BENCH HAD NO OCCASION TO PERUSE VARIOUS DETAILS FILED BY THE ASSESSEE IN THE FORM OF PAPER BOOK AT THE TIME OF HEARING AS WELL AS WHILE ADJUDICATING THE GROUND RAISED BY THE ASSESSEE. BEFORE US, THE LD. COUNSEL SUBMITS THA T INADVERTENTLY THE DOCUMENTS FILED BY THE ASSESSEE IN THE FORM OF PAPER BOOKS WERE NOT PLACED BEFORE THE BENCH AND PLEADS FOR GIVING GIVEN ONE MORE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. TO MEET THE ENDS OF NATURAL JUSTICE, WE ARE OF THE CONSIDERED O PINION THAT THE ASSESSEE SHOULD BE GIVEN ONE MORE OPPORTUNITY OF BEING HEARD, AS PLEADED ABOVE, WE RECALL THE ORDER PASSED BY THE TRIBUNAL IN I.T.A. NO. 322/MDS/2015 FOR THE ASSESSMENT YEAR 2011 - 12 DATED 30.06.2016, FOR LIMITED PURPOSE, TO DECIDE THE ABOVE ISSUE AFRESH AFTER HEARING TO BOTH THE PARTIES. ACCORDINGLY, WE DIRECT THE REGISTRY TO POST THE APPEAL FOR LIMITED PURPOSE ON REGULAR COURSE . 4. WITH REGARD TO GROUND NO. 3 RELATING TO DISALLOWANCE OF DEDUCTION UNDER SECTION 10AA OF THE ACT, ON PERUSAL OF THE ORDER OF THE TRIBUNAL, WE FIND THAT AFTER CONSIDERING THE MATERIALS AVAILABLE ON RECORD AS WELL AS PROVISIONS OF SECTION, THE TRIBUNAL HAS ADJUDICATED THE ISSUE ON MERITS AT M.P . NO . 2 18 /M/ 16 4 PARA 15 & 16 AND THERE APPEARS NO REQUIREMENT TO VERIFY ANY DETAILS FROM T HE PAPER BOOK, WE ARE OF THE OPINION THAT THERE IS NO MISTAKE APPARENT ON RECORD WARRANTING RECTIFICATION/ RECALLING THE ORDER. 4.1 FURTHER, WITH REGARD TO GROUND NO. 4 RELATING TO DISALLOWANCE ON ACCOUNT OF UNREALIZED FOREIGN EXCHANGE LOSS, WE FIND THAT THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE AT PARA 21 OF THE ORDER OF THE TRIBUNAL. THUS, BOTH THE ABOVE GROUNDS ARE DISMISSED. 4.2 IN VIEW OF THE ABOVE, WE SHALL MAKE CLEAR THAT AGAINST THE FIRST ISSUE OF DOWNWARD ADJUSTMENT WITH RESPECT TO TP TRANSACTIONS, THE ORDER OF THE TRIBUNAL IS RECALLED FOR LIMITED PURPOSE. 5. THE MISCELLANEOUS PETITION FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON THE 04 TH APRIL, 2017 AT CHENNAI. SD/ - SD/ - ( CHANDRA POOJARI ) ACCOUNTANT MEMBER ( DUVVURU RL REDDY ) JUDICIAL MEMBER CHENNAI, DATED, THE 04 . 0 4 .201 7 VM/ - / COPY TO: 1. / APPELLANT , 2. / RESPONDENT , 3. ( ) / CIT(A) , 4. / CIT , 5. / DR & 6. / GF.