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TMI Blog2012 (11) TMI 890X X X X Extracts X X X X X X X X Extracts X X X X ..... 92C(3) - petitioner was on notice of the nature of the enquiry which was being persued by the Transfer Pricing Officer - reasonable opportunity was granted to the petitioner which is evident from the affidavit filed by the Department - order has been passed by an authority competent to pass such an order - writ petition is accordingly dismissed. No order as to costs - WRIT PETITION NOS. 2229 & 2230 OF 2011 - - - Dated:- 14-5-2012 - SHANTANU KEMKAR AND S.C. SHARMA, JJ. S.E. Dastoor, N.K. Dave and Madhur Agrawal for the Petitioner. Mohan Parasaran, Alok Prasanna Kumar, Ramanlal Jain and Ku. Veena Mandlik for the Respondent. ORDER S.C. Sharma, J. - Regard being had to the similitude in the controversy invoked in the present cases, the writ petitions were analogously heard and by a common order, they are being disposed of by this Court. Facts of Writ Petition No. 2229/2011 are narrated hereunder. 2. The petitioner Company before this Court, a Company incorporated and registered under the Companies Act, 1956, has filed this present petition challenging the reference made under section 92CA(1) dated 26/3/2009 for the assessment year 2008 - 2009 by the Addl. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Officer. It has also been stated that opportunity to examine one Mr. Deepak Sehgal was also not given to the petitioner Company and therefore the order passed by the Transfer Pricing Officer deserves to be set aside. The petitioner Company has also prayed for quotient of subsequent Show Cause Notice dated 10/11/2010 and 6/1/2011. The petitioner Company has raised various grounds before this Court and has relied upon the judgments delivered by the Hon'ble Supreme Court and various High Courts governing the issue on merits. On the question of availability of alternative remedy, the petitioner Company has relied upon the judgment delivered in the case of Calcutta Discount Co. Ltd. v. ITO [1961] 41 ITR 191 (SC); Harbanslal Sahnia v. Indian Oil Corpn. Ltd. [2003] 2 SCC 107; Whirlpool Corpn. v. Registrar of Trade Marks [1998] 8 SCC 1; A.V. Venkateswaran, Collector of Customs v. Ramchand Sobhraj Wadhwani AIR 1961 SC 1506. 3. A reply has been filed on behalf the respondents and it has been stated on affidavit that while making a reference under section 92CA(1) dated 26/3/2009, for the assessment year 2008 - 2009, approval was obtained from the Commissioner of Income Tax - I, as per the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r dated 26/3/09 which was received on 3/4/09. Letter dated 3/04/2009 was issued to the petitioner asking several details in relation to the Transfer Pricing proceedings and in response to the letter issued by the Transfer Pricing Officer, the petitioner attended the Office on 28/4/09 and submitted letters dated 27/4/09. The petitioner was asked to file the following details : 1. Incorporation documents of AE (FZE), details of legal law, where it is registered 2. Balance sheet and Profit Loss account of Associated Enterprises 3. Freights paid to third parties and comparison with those paid to associated enterprises 4. Break-up of freight expenses in Profit Loss Accounts. The affidavit further reveals that the petitioner also did not appear on some of the dates, sought adjournments and he was also informed that he should co-operate with the proceedings. The Transfer Pricing Officer has categorically stated that documents were furnished to the petitioner and in spite of repeated opportunities, a totally non - cooperative attitude was adopted by the petitioner Company. The respondents have further stated that reasonable opportunity was granted to the petitioner Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r cause to be produced on a date to be specified therein, any evidence on which the assessee may rely in support of the computation made by him of the arm's length price in relation to the international transaction referred to in sub-section (1). (2A) Where any other international transaction other than an international transaction referred under sub-section (1), comes to the notice of the Transfer Pricing Officer during the course of the proceedings before him, the provisions of this Chapter shall apply as if such other international transaction is an international transaction referred to him under sub-section (1). (3) On the date specified in the notice under sub-section (2), or as soon thereafter as may be, after hearing such evidence as the assessee may produce, including any information or documents referred to in sub-section (3) of section 92D and after considering such evidence as the Transfer Pricing Officer may require on any specified points and after taking into account all relevant materials which he has gathered, the Transfer Pricing Officer shall, by order in writing, determine the arm's length price in relation to the international transaction in accordance with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ionally competent to pass such an order and it can never be said that the order passed by the respondents is without jurisdiction. 10. Section 144C of the Income-tax Act, 1961, reads as under : 144C. Reference to Dispute Resolution Panel. (1) The Assessing. Officer shall, notwithstanding anything to the contrary contained in this Act, in the first instance, forward a draft of the proposed order of assessment (hereafter in this section referred to as the draft order) to the eligible assessee if he proposes to make, on or after the 1st day of October, 2009, any variation in the income or loss returned which is prejudicial to the interest of such assessee. (2) On receipt of the draft order, the eligible assessee shall, within thirty days of the receipt by him of the draft order, (a) file his acceptance of the variations to the Assessing Officer: or (b) file his objections, if any, to such variation with, (i) the Dispute Resolution Panel; and (ii) the Assessing Officer. (3) The Assessing Officer shall complete the assessment on the basis of the draft order, if (a) the assessee intimates to the Assessing Officer the acceptance of the variation; or (b) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13) Upon receipt of the directions issued under sub-section (5), the Assessing Officer shall, in conformity with the directions, complete, notwithstanding anything to the contrary contained in section 153, the assessment without providing any further opportunity of being heard to the assessee, within one month from the end of the month in which such direction is received. (14) The Board may make rules for the purposes of the efficient functioning of the Dispute Resolution Panel and expeditious disposal of the objections filed under sub-section (2) by the eligible assessee. (15) For the purposes of this section, (a) "Dispute Resolution Panel" means a collegium comprising of three Commissioners of Income-tax constituted by the Board for this purpose; (b) "eligible assessee" means, (i) any person in whose case the variation referred to in sub-section (1) arises as a consequence of the order of the Transfer Pricing Officer passed under sub-section (3) of section 92CA; and (ii) any foreign company.'. The aforesaid statutory provision of law provides for submitting objections to the Dispute Resolution Panel and the Assessing Officer. The Dispute Resolution Panel compr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... saction. After considering the evidence which the assessee may produce and after taking into account all relevant materials which he has gathered, the Transfer Pricing Officer can determine the Arm's Length Price in accordance with sub-Section (3) of Section 92C. The proviso to sub-section (3) requires the Assessing Officer to furnish a notice calling upon the assessee to show cause why the Arm's Length Price should not be determined on the basis of material, information or documents in the possession of the Assessing Officer. Once a determination is made by the Transfer Pricing Officer, the Assessing Officer under Section 92CA(4) has to compute the total income of the assessee in conformity with the Arm's Length Price as determined by the Transfer Pricing Officer. Section 144C mandate's that the Assessing Officer shall forward a draft of the proposed order of assessment if he proposes to make any variation in the income or loss returned which is prejudicial to the interest of the Assessee. Upon receipt of the draft order, the Assessee is entitled to submit his objections to the variation with the Dispute Resolution Panel and the Assessing Officer under sub-section (5) of section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions, to which a reference is made earlier, a comprehensive remedy is available to the Petitioner before the Assessing Officer frames an order of assessment. A draft order has to be prepared to which the petitioner is entitled to submit its objections. Even against the draft order, the petitioner has a remedy of moving the Dispute Resolution Panel. Though the Assessing Officer is bound by the determination of the Arm's Length Price by the Transfer Pricing Officer, it is evident from the statutory scheme that the Appellate Tribunal before which remedy of an Appeal is available would be entitled to consider every aspect of the matter when it renders its decision in the exercise of its appellate powers. 12. In this view of the matter, we are not inclined to exercise the writ jurisdiction under Article 226 of the Constitution of India at this stage. We find no merit in the submission that there was a breach of the principles of natural justice by the Transfer Pricing Officer. Under sub-section (3) of section 92CA the Transfer Pricing Officer is required to comply with the principles of natural justice and to render a determination of the Arm's Length Price in relation to the inte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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