9911796707
TMI Blog2012 (5) TMI 343X X X X Extracts X X X X X X X X Extracts X X X X ..... against the order of Dispute Resolution Panel (DRP) Chennai, dated 17.9.2010. 2. In Ground Nos. 1 to 5 of the appeal, the assessee has challenged the direction of the DRP for adding a sum of Rs. 30,03,273/- to the total income based on the Transfer Pricing Officer's (TPO)order. 3. The brief facts of the case are that the assessee has adopted Transactional Net Margin Method (TNMM) to determine the Arm's Length Price (ALP). On examination of the service agreement between the assessee and the AE, M/s SCM Micro System (Asia) Pte. Ltd., Singapore, the TPO was of the view that the assessee's service income should be received at Rs. 11,52,60,199/- in place of Rs. 11,22,56,926/-. The assessee argued before the TPO that the mark up on cost of the company is more than that of the comparable companies, the transactions entered into by the company with the AE is at Arm's Length and therefore, no adjustment was required. According to the TPO, when the assessee is able to ultimately collect revenue with reasonable certainty, there is no need to postpone the recognition of Revenue. The TPO was also of the view that there was no risk to revenue recognition, therefore, the assessee's not recogniz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me should not have been excluded from the export turnover while computing the deduction u/s 10B of the Act. 5. The brief facts of the case are that the Assessing Officer observed that internet charges of Rs. 13,93,753/- was required to be reduced from the ETO for the purposes of deduction u/s 10B of the Act for the reason that the issue regarding deduction of expenses from ETO had not reached a finality the aforesaid amount of Rs. 13,93,753/- being internet charges was required to be reduced from the ETO and deduction u/s 10B was recalculated. 6. Being aggrieved by the said order, the assessee filed appeal before the DRP. The assessee submitted that the Assessing Officer has not appreciated that telecommunication/internet charges were not included as part of ETO and as such, the same cannot be excluded from the ETO while computing the deduction u/s 10B of the Act. The DRP decided the issue by observing as under: "5.3 We are carefully considered the facts of the case and the position of law on this issue. As per section 10B internet charges are required to be reduced from the ETO for the purpose of deduction u/s 10B. This is what precisely the A.O has done and his action is as pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to be made by, it. Under sub-section (7), DRP is also authorized before issuing of direction under sub-section (5) to make such further inquiry, as it think fit or cause any further inquiry to be made by any income-tax authority and report the result of the same to it. Under sub-section (8) the DRP has power to confirm, reduce or enhance the variations proposed in the draft order so, however, that it shall not set aside any proposed variation or issue any direction under sub-section (5) for further inquiry and passing of the assessment order. Under sub-section (11) no direction u/s subsection (5) shall be issued unless an opportunity of being heard is given to the assessee and the Assessing Officer on such directions which are prejudicial to the interest of the assessee or the interest of the revenue respectively. Under sub-section (12) directions under sub-section (5) cannot be passed after nine months from the end of the month in which draft order is forwarded to the eligible assessee. Under sub-section (13), on receipt of directions issued under subsection (5), the Assessing Officer has to pass the assessment order in conformity with the directions without providing any furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the respondent No. 1 is quashed and the matter is remanded to the said respondent to adjudicate afresh. Be it noted, when a quasi-judicial authority deals with a list, it is obligatory on its part to ascribe cogent and germane reasons as the same is the heart and soul of the matter and further, the same also facilitates appreciation when the order is called in question before the superior forum. Needless to say that the competent authority, while passing the order, shall keep in mind the order dated 29th November, 2010 wherein we had directed that the period from the date of filing the write petition and four weeks after its disposal shall stand excluded, while computing the limitation for the department to pass an assessment order. The writ petition is allowed to the extent indicated above without any order as to costs. Order dasti under the signatures of the Court Master." [WPO (C) 7028/2010] 12. This Tribunal in many of such cases has restored the issue to the file of DRP for passing a speaking order on each of the objection of the assessee raised before it. Therefore, we find that it is a fit case where the entire matter should be restored back to the file of DRP to pass ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
