H&S Software Development And Knowledge Management Centre (P) Ltd, Gurgaon V. ITO, New Delhi

MA 251/DEL/2018

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 2873 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 4 month(s) 16 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 08-09-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I2
• Next Hearing Date: 10-03-2022
• Assessment Year: 2010-2011
• Appeal Filed On: 22-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: VISHU GOEL
• Keywords: Transfer pricing

Judgement Text

MA. 251/Del/2018 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “I-2” NEW DELHI BEFORE SHRI NARENDRA KUMAR BILLAIYA, ACCOUNTANT MEMBER A N D SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER Misc. App. No. 251/Del/2018 [ in आ.अ.सं . I.T.A No. 516/Del/2015 ] ( िनधाᭅरण वषᭅ/Assessment Year: 2010-11 ) M/s. H & S Software Development and Knowledge Management Centre Pvt. Ltd., MVLi Park, Unit No. 501 & 502, 5 th Floor, Near Red Cross Society, Sector 15, Part II, Gurgaon – 122 001 [Haryana] बनाम Vs. DCIT, Ward : 11 (1), New Delhi. PAN No. AABCH2697E अपीलाथŎ /Applicant ᮧ᭜यथᱮ/Respondent िनधाᭅᳯरतीकᳱओरसे /Assessee by : Shri S. S. Tomar, Adv.; & Shri Vishu Goel, C. A.; राज᭭वकᳱओरसे /Revenue by : Shri M. Baranwal, Sr. D. R.; सुनवाईकᳱतारीख/ Date of hearing : 11/03/2022 उ᳃ोषणाकᳱतारीख/Pronouncement on : 09/09/2022 आदेश / O R D E R PER C. N. PRASAD, J. M. : 1. Through this Misc. application the assessee prays for restoring/recalling the order of the Tribunal in ITA. No. 516/Del/2015 dated 20.03.2018 for the assessment year 2010-11 for the limited purpose of adjudicating ground No. 3.5 of grounds MA. 251/Del/2018 2 of appeal of the assessee vis-a-vis the exclusion of Eclerx Services Limited (Eclerx) from the set of comparable companies for the assessment year 2010-11, which is under consideration. 2. The ld. Counsel for the assessee submits that the Tribunal inadvertently missed to give any finding on rejection of Eclerx Services Ltd. from the set of comparables though the assessee had consistently argued for rejection of the said company. The ld. Counsel submits that the Tribunal for the assessment year 2007-08, 2008-09 and 2011-12 excluded Eclerx Services Limited from the set of comparables while determining the transfer pricing adjustment. The ld. Counsel referring to page 26 of the paper book submits that the assessee contended before the Tribunal that it is disputing Eclerx Services Limited as one of the comparable companies for the assessment year 2010-11 and written arguments were placed at page 33 of the paper book. Therefore, the ld. Counsel for the assessee submits that the Tribunal in its order in ITA. No. 516/Del/2015 dated 20.03.2018 did not adjudicate ground No. 3.5 completely in the sense that one of the comparable companies, namely, Eclerx Services Limited which was disputed by the assessee was not adjudicated. 3. The ld. DR submits that the assessee has not taken ground in the grounds of appeal. 4. In reply the ld. Counsel for the assessee submits that the assessee had taken ground No. 3.5 specifically for selecting companies which were not comparable to the assessee on various grounds. MA. 251/Del/2018 3 5. We have heard the rival submissions, gone through the contentions of the assessee in the Misc. application and the order passed by the Tribunal and the grounds of appeal filed by the assessee. In the appeal filed by the assessee the assessee disputed the order of the Assessing Officer in determining arm’s length price of the assessee on international transactions by raising the following ground of appeal:- “3. That on the facts and circumstances of the case and in law, the Ld. AO erred in determining the arm's length price ("ALP") of the Appellant's international transactions at Rs.l61,838,198/- as against Rs.l41,550,138/- determined by the Appellant and recommending an addition of Rs.20,288,0601- on that account to the Appellant's income by : 3.1 modifying the comparability analysis conducted in the transfer pricing documentation of the Appellant on inappropriate and inadequate grounds; 3.2 rejecting the applicability of functional filter applied in the search process by the Appellant; 3.3 adopting a new search criterion and inconsistently applying certain additional quantitative filters; 3.4 rejecting the comparable companies selected by the Appellant without providing cogent and sufficient reasoning; 3.5 selecting companies which were not comparable to the Appellant on various grounds: 3.6 confirming the selection of current year (i.e. financial year 2009-10) data for comparability; 3.7 erred in not appreciating the fact that there is no motive on the part of the Appellant to shift the profits to any other jurisdiction since it claims tax holiday benefits as per the Software Technology Park of India.” 6. In ground No. 3.5 of the grounds of appeal the assessee specifically challenged the order of the Assessing Officer in selecting companies, which were not comparable to the assessee. MA. 251/Del/2018 4 The assessee made its submissions before the Tribunal for exclusion of Eclerx Services Limited, which is placed at page 33 of the paper book. However, the Tribunal while passing the order in ITA. No. 516/Del/2015 dated 20.03.2018 inadvertently omitted to adjudicate one of the comparable companies, namely, Eclerx Services Limited. Non-adjudication of ground No. 3.5 vis-à-vis Eclerx Services Limited while passing the order by the Tribunal is a mistake apparent from record. Thus, we recall the order of the Tribunal in ITA. No. 516/Del/2015 dated 20.03.2018 for the limited purpose of adjudicating one of the comparables, namely, Eclerx Services Limited, which is part of ground No. 3.5 for adjudication by the Tribunal. The Registry is directed to post the appeal for hearing in due course for the limited purpose of disposing of ground No. 3.5 and the comparable Eclerx Services Limited by issusing notice to both the parties. 7. In the result, the Misc. application is allowed, as indicated above. Order pronounced in the open court on : 09/09/2022. Sd/- Sd/- ( N. K. BILLAIYA ) ( C. N. PRASAD ) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 09/09/2022. *MEHTA* Copy forwarded to 1. Applicant; 2. Respondent; 3. CIT MA. 251/Del/2018 5 4. CIT (Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, New Delhi. Date of dictation 02.09.2022 Date on which the typed draft is placed before the dictating member 08.09.2022 Date on which the typed draft is placed before the other member 09.09.2022 Date on which the approved draft comes to the Sr. PS/ PS 09.09.2022 Date on which the fair order is placed before the dictating member for pronouncement 09.09.2022 Date on which the fair order comes back to the Sr. PS/ PS 09.09.2022 Date on which the final order is uploaded on the website of ITAT 09.09.2022 Date on which the file goes to the Bench Clerk 09.09.2022 Date on which the file goes to the Head Clerk The date on which the file goes to the Assistant Registrar for signature on the order Date of dispatch of the order