SCIOINSPIRE CONSULTING SEVICES INDIA PVT LTD,CHENNAI V. DCIT,CIRCLE-22(2), DELHI

SA 92/DEL/2025

AI Insights

The case involves Scioinspire Consulting Services India Pvt. Ltd., which filed a stay application (SA No. 92/Del/2025) against the Deputy Commissioner of Income Tax, Circle-22(2), New Delhi, concerning an outstanding demand of Rs. 1,16,19,350 for the assessment year 2021-22. The demand arose from an assessment order dated 11th November 2024, which was contested by the assessee on grounds including that the order was time-barred and that the adjustments made to the income were unjustified. The Tribunal considered the arguments and decided to grant a stay on the recovery of the demand, pending a detailed hearing of the appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 30523 (ITAT-DELHI)
• Appeal Type: Stay Application
• Pronouncement Date: 28-02-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: H
• Assessment Year: 2021-2022
• Other Referred Cases: CIT v. Roca Bathroom Products Pvt. Ltd. [2021] 127 taxmann.com 332, Shelf Drilling Ron Tappmeyer Limited v. ACIT [2023] 153 taxmann.com 162, Louis Dreyfus Company India Pvt. Ltd. v. DCIT [2024] 464 ITR 595(Del.), M/s Expeditors International of Washington Inc. v. ACIT, Circle International Tax 1(2)(2), Delhi in WP(C) 11032/2022 &C.Mo. No. 32314/2022
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SANJAY KUMAR
• Assessee Lawyers: AJAY VOHRA; .; DHRUV SETH
• Keywords: Transfer pricing; International transaction; Depreciation; Validity of assessment; Application of stay
• Section: 143(3); 153

Judgement Text

"1 SA no. 92/Del/2025 (In ITA no. 146/Del/2025) A.Y. 2021-22 1 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: ‘H’: NEW DELHI) BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT, AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER SA No.: 92/Del/2025 Arising Out of ITA No.: 146/Del/2025 (Assessment Year: 2021-22) Scioinspire Consulting Services India Pvt. Ltd., Tower 1, 6th Floor TVH Beliciaa Towers, Block no. 94, MRC Nagar, Chennai, Tamilnadu-600028. v. Deputy Commissioner of Income Tax, Circle-22(2), New Delhi. PAN No: AALCS 3371 E APPELLANT RESPONDENT Assesseeby : Shri Ajay Vohra, Sr. Adv., & Shri Dhruv Seth, CA Revenue by : Shri Sanjay Kumar, CIT-DR Date of Hearing : 28.02.2025 Date of Pronouncement : 28.02.2025 ORDER PER RAMIT KOCHAR, AM: This stay application bearing SA no. 92/Del/2025, arising out of appeal in ITA no. 146/Del/2025 for A.Y. 2021-22, has been filed by the assessee seeking stay on recovery of outstanding demand towards income-tax and interest thereon , to the tune of Rs. 1,16,19,347/-. The assessment has been framed by the Assessing Officer vide assessment order dated 11.11.2024 passed u/s. 143(3) read with 2 SA no. 92/Del/2025 (In ITA no. 146/Del/2025) A.Y. 2021-22 2 section 144C(3)read with section 144B of the Income-tax Act, 1961 (“the Act”) (DIN:ITBA/AST/S/143(3)/2024-25/1070254835(1)), wherein the income assessed by the AO was to the tune of Rs. 18,82,35,350/- as against the returned income filed by the assessee at Rs. 16,00,85,280/-. Notice of demand u/s 156 and the computation sheet issued by the AO are enclosed by the assessee bearing DIN & Notice no. ITBA/AST/S/156/2024-25/1070254903(1) and DIN & Doc. no. ITBA/AST/S/621/2024-25/1070254905(1) respectively, both dated 11.11.2024, raising demand against the assessee to the tune of Rs. 1,16,19,350/- towards income-tax and interest thereon. 2. The learned counsel for the assessee Shri Ajay Vohra, Senior Advocatesubmitted before the Bench that the assessee is engaged in providing IT and IT enabled services(ITES) to Group companies. Learned counsel for the assessee submitted that the assessment order passed by the AO is barred by limitation keeping in view provisions of section 153(1) read with section 153(4) of the Act. It was submitted that the assessee has raised this ground of appeal challenging legality and validity of assessment order on the grounds of being time barred in its appeal filed with ITAT. Learned counsel referred to the judgment and order of the Hon’ble Madras High Court in the case of CIT v. Roca Bathroom Products Pvt. Ltd. [2021] 127 taxmann.com 332; and also judgment and order of Hon’ble Bombay High Court in the case of Shelf Drilling Ron Tappmeyer Limited v. ACIT [2023] 153 taxmann.com 162. It was submitted that , however, the aforesaid issue relating to the 3 SA no. 92/Del/2025 (In ITA no. 146/Del/2025) A.Y. 2021-22 3 limitation is now sub-judicebefore Hon’ble Supreme Court. Further, it is also the say of learned counsel that the order was required to be passed by the AO within one month from the end of the month in which directions of learned DRP were received by the AO. The ld. Counsel for the assessee submitted that the directions were issued by learned DRP on 29.09.2024 and the assessmentwas required to be completed by the AO by 31.10.2024 , while the assessment in this case was completed by AO only on 11.11.2024 , and hence the assessment order is time barred. Our attention was drawn to email received from ld. DRP by the assessee on 29.09.2024 at 11.32AM(Page 192 PB). Learned counsel for the assesseerelied on the judgment and order of Hon’ble Delhi High Court in the case of Louis Dreyfus Company India Pvt. Ltd. v. DCIT [2024] 464 ITR 595(Del.) and other decisions of Hon’ble Courts as are stated in the stay application. The said judgment and order is placed on record in PB filed by the assessee. Further, it is the say of the learned counsel for the assessee Shri Ajay Vohra, Senior Advocate that the upward adjustment to ALP has been made by Revenue to the tune of Rs. 2,81,50,076/- in relation to the international transaction of provision of IT services. It is submitted that even on merit, theassessee has a good case as the assessee has charged depreciation on fixed assets on Straight Line Method(‘SLM’) basis at the rates higher than depreciation rates as stipulated under the Companies Act, 2013, keeping in view the useful life of the fixed assets vis-a-vis comparable’s selected by TPO who may have charged depreciation as per rates provided under the 4 SA no. 92/Del/2025 (In ITA no. 146/Del/2025) A.Y. 2021-22 4 Companies Act, 2013. Thus, the assessee ought to have been provided adjustment on account of differential in depreciation so charged on fixed assets by the assessee vis-à-vis comparables. It was submitted by ld. Counsel for the assesseethat in the case of group company, namely, Exl Service.Com(India) Pvt. Ltd., the Delhi Benches of ITAT in ITA nos. 1939 /Del/2008 for A.Y. 2003-04; and in ITA nos. 302 & 615/Del/2015 for A.Y. 2010-11 , has allowed depreciation adjustment to the profits of the comparable’s on account of difference in deprecation method viz. SLM adopted by the said assessee EXL , and while comparable’s may have adopted WDV method for computing deprecation .It is also averred by ld. Counsel for the assessee that there are other challenges raised by the assessee on merits to the additions to the incomeas was made by the AO.Thus, in nut-shell it was submitted that the assessee has good prima-facie case for grant of stay on recovery of outstanding demand of income-tax and interest thereon. 3.The learned CIT-DR left the matter to be decided by the Bench. 4. After hearing both the parties , we are of the view, without commenting on the merits of the issues arising in the appeal, that the assessee has made out a prima-facie case for grant of early hearing of the appeal filed by the assessee, and the appeal in ITA no.146/Del/2025 for assessment year 2021-21 filed by the assessee be listed out of turn for hearing before the ITAT, ‘H’ Bench, Delhi , on 9.04.2025, and in the meantime the Department is directed not to 5 SA no. 92/Del/2025 (In ITA no. 146/Del/2025) A.Y. 2021-22 5 take any coercive action against the assessee for recovery of outstanding demand towards income-tax and interest thereon to the tune of Rs. 1,16,19,350/- until the date of hearing of the appeal i.e. 9.4.2025. It will also be relevant to refer here to the order of Hon’ble Delhi High Court dated 29th July, 2022 in M/s Expeditors International of Washington Inc. v. ACIT, Circle International Tax 1(2)(2), Delhi in WP(C) 11032/2022 &C.Mo. No. 32314/2022. We would like to reiterate and clarify once again that we have not commented on the merits of the issues arising in the appeal.Further, that the assessee will fully co-operate in speedy disposal of the appeal by ITAT, and the assessee will not seek any un-necessary adjournments before the Tribunal in the appellate proceedings in ITA No. 146/Del/2025. On breach of aforesaid conditions, the out of turn hearing granted by us vide this order shall revert back to its original status. The terms of this order was pronounced during the course of hearing in open court. We order accordingly. 5. In the result, Stay Application filed by the assessee is disposed off in the manner as stated in this order. Order pronounced in the open court on 28th February, 2025. Sd/- Sd/- (MAHAVIR SINGH) (RAMIT KOCHAR) VICE PRESIDENT ACCOUNTANT MEMBER Dated: 06/03/2025. *MPV* 6 SA no. 92/Del/2025 (In ITA no. 146/Del/2025) A.Y. 2021-22 6 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. DRP 5. DR Asst. Registrar, ITAT, New Delhi "