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TMI Blog2012 (10) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... P Whether issues on Transfer pricing is decided by DRP and Non Transfer pricing issues are decided by Tribunal – Held that:- The various issues raised in the appeal filed by the assessee for a particular assessment year will be placed before different authorities at different levels, issuewise and groundwise, then it will very difficult for the AO to pass the final order to give effect to the appellate and court directions and it will be difficult for the assessee as well to appear before different authorities for arguing different points. Entire file remit back to DRP - ITA No.2112(Mds)/2010 - - - Dated:- 13-6-2012 - Dr. O.K. NARAYANAN, AND SHRI VIKAS AWASTHY, JJ. Appellant by : Shri Arvind Sonde, Advocate Respondent by : Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ck obsolescence. Community development expenses. Deduction under section 35D. Disallowance under section 40(a), etc. 4. Shri Arvind Sonde, the learned counsel, appeared for the assessee and Shri K.E.B.Rengarajan, the learned standing counsel, appeared for the Revenue. 5. The first objection raised by the learned counsel appearing for the assessee is that the proceedings of the DRP at Chennai in the present case is a nullity in the eyes of law, as the DRP has not opened their mouth to express any opinion, this way or that way, on various issues of TP matters raised by the assessee before it. 6. The learned counsel explained that disputes on TP analysis made for the earlier assessment year 2004-05 are pending before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O. during the T.P. audit. Briefly, the assessee wants multiple year data. Further, it was pleaded on behalf of the assessee that there was inappropriate analysis conducted by the T.P.O. with regard to the fundamental principles of transfer pricing. Non-performance of appropriate adjustments to the comparable companies and capacity utilization were not considered properly. It was also pleaded on behalf of the assessee that the T.P.O. has disturbed the Cost Plus Method (CPM) adopted by the assessee in its T.P. audit and instead adopted the TNMM as the most appropriate method (MAM). The assessee also reiterated its earlier stand which was taken by it before the T.P.O. that multiple year data should be adopted, however the assessee has not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issues this year are identical with those as obtaining in A.Y. 2004-05, therefore no separate view can be taken by us on the present application of the assessee before us. We therefore uphold the action of the T.P.O. in making the upward and downward adjustments in respect of assessee s exports and imports respectively from its AEs. Consequently, the addition of Rs.44,74,32,138/- proposed by the A.O. is confirmed and these grounds of dispute are rejected. The learned counsel invited our attention specifically to subsections (5), (7) and (13) of section 144C, where the law has stated the statutory responsibility of the DRP in giving directions to the Assessing Officer in the matters of transfer pricing. The DRP has not followed any of su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acted above. A reading of the said extract shows that the DRP has not considered any of the objections raised by the assessee in respect of TP matters. They held that the appeal filed by the assessee on some issues are pending before the Commissioner of Income-tax(Appeals) pertaining to the assessment year 2004-05 and, therefore, the issues have not reached finality and for that reason the contentions raised by the assessee for the impugned assessment year 2006-07 are liable to be rejected. Therefore, the DRP themselves have made it clear that they are upholding the draft order of the assessing authority on TP issues without considering the objections and arguments of the assessee. When the DRP itself concedes that they have rejected the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing authority. We set aside the proceedings of the DRP dated 28-9-2010. 15. We remit back the file to the DRP to consider the reference made by the assessee afresh in accordance with law and after hearing the assessee in detail. As held by the Hon ble Delhi High Court in the case of Vodafone Essar Ltd. vs. Dispute Resolution Panel-II Ors., when a quasi judicial authority deals with a lis, 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. 16. The learned standing counsel appearing for the Revenue has suggested that the Tribunal may adjudicate the issues rais ..... X X X X Extracts X X X X X X X X Extracts X X X X
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