Electronic Arts Games (India) Private Limited, Hyderabad V. Deputy Commissioner of Income Tax, Circle 17(1), Hyderabad

MA 24/Hyd/2018

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6860 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 17 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-07-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 08-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A RAJVANSH I JAIN
• Assessee Lawyers: KARISHMA R PHATARPHEKAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER M.A. NO. 24/HYD/2018 (IN ITA NO. 325 /HYD/2016 ASSESSMENT YEAR: 2011-12) ELECTRONIC ART GAMES (INDIA) PRIVATE LIMITED, HYDERABAD. PAN AABCJ4279Q VS DY. CIT, CIRCLE 17(1), HYDERABAD. (APPLICANT) (RESPONDENT) ASSESSEE BY : SMT. KARISHMA R. PHATARPHEKAR & SHRI HARSH R. SHAH REVENUE BY : SMT. A. RAJVANSHI JAIN DATE OF HEARING : 20-07-2018 DATE OF PRONOUNCEMENT : 31-07-2018 ORDER PER B. RAMAKOTAIAH, A.M.: IN THIS CASE AN ORDER HAS BEEN PASSED ON 29.12.2017, WHEREIN AFTER NOTICING THAT DRP HAS NOT GIVEN ANY CLEAR DIRECTIONS AS FAR AS THE COMPARABLES ARE CONCERNED THE MATTER WAS SET ASIDE TO TPO. THE FINAL FINDINGS OF THE TRIBUNAL ARE AS UNDER: THEREFORE, ONLY OPTION LEFT IS TO SET ASIDE THE ORDER OF TPO AND CONSEQUENTIAL ORDER OF DRP AND A.O AND RESTORE THE ISSUE TO TPO AGAIN TO UNDERTAKE THE EXERCISE AFRESH ON THE BASIS OF EITHER ASSESSEE REPORT OR FRESH SEARCH ON THE BASIS OF NEW PARAMETERS / COMPARABLES AND DETERMINE WHETHER ANY ADDITION IS WARRANTED ON THE FACTS. WE ALSO ADVICE THE DRP TO GIVE CLEAR DIRECTIONS TO THE TPO SO THAT THIS SORT OF CONFUSION ARISING IN THE MIND OF ASSESSEE AND OTHER JUDICIAL AUTHORITIES CAN BE AVOIDED. THE GROUNDS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 2 M.A NO. 24/HYD/2018, ELECTRONIC ART GAMES (INDIA) PVT LTD., HYD. 2. THE PRESENT MISCELLANEOUS APPLICATION IS PREFERRED BY ASSESSEE ON THE ISSUE THAT THE BENCH HAS WRONGLY EXCLUDED ONE COMPARABLE I.E. EVOKE TECHNOLOGIES PVT LTD., BY OBSERVING IN PARA 9.1 THAT THE SAME COMPANY HAS EXCLUDED IN LATER YEAR ALSO BY DRP ON WHICH ASSESSEE HAS NOT OBJECTED. IT WAS BROUGHT TO THE NOTICE OF THE BENCH THAT ASSESSEE HAS INDEED OBJECTED AND THE ITAT INITIALLY HAS CONFIRMED THE ACTION OF THE DRP, BUT IN MISCELLANEOUS APPLICATION THE SAME WAS RECTIFIED AND THE SAID COMPANY WAS INCLUDED. IF THAT COMPANY IS INCLUDED, THERE IS NO NEED TO SET ASIDE THE ISSUE TO THE FILE OF THE TPO AND THE OBSERVATION OF THE ITAT HAS RESULTED IN A MISTAKE APPARENT FROM RECORD. 3. LD. COUNSEL FOR THE ASSESSEE EXPLAINED THE CASE AND REITERATED THE SUBMISSIONS MADE IN THE MISCELLANEOUS APPLICATION, WHEREAS, LD. DR HAS RELIED ON THE ORDER OF THE ITAT. 4. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE APPLICATION FILED. EVEN IN THE MISCELLANEOUS APPLICATION, ASSESSEE ADMITS IN PARA 15 THAT DUE TO AMBIGUOUS DIRECTIONS OF DRP, THE ASSESSEE HAS ARGUED THE CASE ON TWO SCENARIOS (A) SCENARIO 1, TAKING THE DRP SET OF THREE COMPANIES AS STARTING POINT (B) SCENARIO 2, TAKING THE TPO SET OF 18 COMPANIES AS STARTING POINT. THUS, IT IS ADMITTED THAT DRP DIRECTIONS WERE AMBIGUOUS AND SCENARIO-1 AND SCENARIO-2 WERE IMAGINED AND ARGUMENTS WERE PLACED ON THAT BASIS. AFTER CONSIDERING THE ARGUMENTS OF THE COUNSEL, THE BENCH IS OF THE OPINION THAT THE ORDERS OF THE DRP CANNOT BE CONSIDERED AND ANALYSED BOTH THE 3 M.A NO. 24/HYD/2018, ELECTRONIC ART GAMES (INDIA) PVT LTD., HYD. SCENARIOS AND HAS COME TO CONCLUSION TO SET ASIDE THE ISSUE TO THE FILE OF THE TPO TO UNDERTAKE THE EXERCISE AFRESH. SINCE IT IS A CONSCIOUS DECISION TAKEN AFTER ANALYZING THE SUBMISSIONS OF THE LD. COUNSEL, THE FINAL DECISION CANNOT BE MODIFIED IN THE MISCELLANEOUS APPLICATION. THE ITAT HAS NO POWER TO REVIEW ITS OWN ORDER. 4.1 AS FAR AS THE SO CALLED MISTAKE OF EVOKE TECHNOLOGIES PVT LTD., POINTED OUT IN PARA 9.1 IS CONSIDERED, THE WORD WHICH ASSESSEE HAS NOT OBJECTED HAS TO BE MODIFIED, IN VIEW OF THE ORDERS IN LATER YEAR IN THE MISCELLANEOUS APPLICATION. THE ONLY COMPARABLE AVAILABLE FOR COMPARISON WILL BE EVOKE TECHNOLOGIES PVT LTD., ON WHICH LD. DR SUBMITTED THAT THERE IS A DIFFERENT STAND AT DIFFERENT STAGES TAKEN BY THE ASSESSEE, BASED ON THE INFORMATION ON THE WEB / ANNUAL REPORT. THIS FORUM CANNOT GIVE ANY FINDING ON THE COMPARABILITY OF THE ABOVE CASE AND SO ENTIRE MATTER IS RESTORED TO THE FILE OF THE A.O / TPO. ASSESSEE IS FREE TO ARGUE THE CASE AFRESH BEFORE THE TPO FOR INCLUSION OF THE ABOVE COMPARABLE IF REQUIRED. TO THAT EXTENT, THE OBSERVATION IS MODIFIED. 5. IN THE RESULT THE MISCELLANEOUS APPLICATION IS CONSIDERED PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 31 ST JULY 2018. SD/- SD/- (P. MADHAVI DEVI) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATED: 31 ST JULY, 2018. 4 M.A NO. 24/HYD/2018, ELECTRONIC ART GAMES (INDIA) PVT LTD., HYD. KRK COPY TO:- 1.ELECTRONIC ARTS GAMES (INDIA) PVT LTD., 7 TH FLOOR, VEGA BLOCK, ASCENDAS IT PARK, MADHAPUR, HYDERABAD. 2. THE DY. CIT, CIRCLE-17(1), HYDERABAD. 3. DISPUTE RESOLUTION PANEL (DRP) 4) DIRECTOR OF INCOME TAX (IT & TP), HYDERABAD. 5) ADDL. CIT (TP), HYDERABAD. 6)THE DEPARTMENT REPRESENTATIVE, I.T.A.T., HYD. 7) GUARD FILE.