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TMI Blog2013 (8) TMI 697X X X X Extracts X X X X X X X X Extracts X X X X ..... guidance of the Assessing Officer to enable him to complete the assessment and under sub-section (6) such directions which are put up under sub-section (5) would be further considering the following documents: (a) draft order; (b) the objection filed by the assessee; (c) the evidence furnished by the assessee; (d) report, if any, of the Assessing Officer, valuation officer, or TPO or any other authority; (e) records relating to the draft order; (f) evidence collected by, or caused to be colleted by, it; and (g) result of any inquiry made by, or caused 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 sub-section (5) shall be issued unless an opportunit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal of the assessee. The DRP has dismissed the grounds of appeal raised before it in a summarily manner without stating the reasons for not accepting the submissions of the assessee or as to why the case laws relied on by the assessee are not applicable to the case of the assessee. He also referred to Annexure to Form 35A filed alongwith the appeal memo and submitted that in this Annexure the assessee has given its detailed arguments pointwise on the order of the Assessing Officer and TPO as to why the orders of the Assessing Officer and TPO were not acceptable to the assessee. The DRP has not considered and decided the objections of the assessee against the order of the Assessing Officer and TPO an therefore, it was his submission that the entire appeal of the assessee should be restored back to the file of the DRP for adjudication afresh. 3. The ld. DR also agreed with the above submission of the ld. A.R of the assessee. 4. After considering the rival submissions and perusing the orders of the lower authorities and materials available on record, we find that the assessee had challenged the order of the Assessing Officer/TPO before the DRP on the following grounds/issues: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperly applied. The panel considered that, and decided that the following comparables may be dropped: Infosys Technologies Limited ("Infosys") - functionally dissimilar Agnite Education Limited ("Agnite") - functionally dissimilar 7Seas Entertainment Limited ("7Seas") - function any dissimilar Cybertech Systems Software Limited - high RPT Following comparables were decided to be added or retained: Kals Information Systems Limited ("Kals") -- functionally similar Indium Softwar (India) Limited ("'Indium") - significant foreign transactions Melstar Information Technologies Limited ("Melstar") - foreign transactions Maars Software International Limited ("Maars") - not persistently loss SIP Technologies Exports Limited ("SIP") - not persistently loss VJIL Consulting Limited ("VJIL") was considered to be loss making. It made loss in two years, and made some operating profit in FY 2007-08. 16. On the adjustments for un utilised rental cost, which was reduced from 24 percent as claimed by the assessee to 10.88 percent, the Panel decided that the TPO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he benefit of + /- 5 % as per proviso to Section 92C of the Act cannot be considered to be a standard universal deduction allowed in each and every case which the assessee exceeds the permissible limit and falls outside the arm's length. The proviso provides a relief to the tax payer at the time of determining the ALP. Therefore, this option is available to the assessee only when assessee is computing the ALP and not when the AO/TPO is computing the "ALP". Thus, this objection of the assessee also is not valid. Directions under Section 144C (5) of the IT Act 19. Based on the above discussion, the direction of the Panel as per the provisions of Section 144C(5) of the IT Act is as below: (a) First Ground of objection - General Objections These are general grounds, and so no comments. (b) Second ground of Objection - Rejection of Adjustments for Extra-ordinary Cost towards Unutilized Space TPO would work out the excess rent payment for 7 months, rented from September 2007, in the case of 1st floor, and allow the adjustments. (c) Third Ground of objection - Rejection of adjustment for Extra-ordinary Travel Costs during start-up phase Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nks fit for the guidance of the Assessing Officer to enable him to complete the assessment and under sub-section (6) such directions which are put up under sub-section (5) would be further considering the following documents: (a) draft order; (b) the objection filed by the assessee; (c) the evidence furnished by the assessee; (d) report, if any, of the Assessing Officer, valuation officer, or TPO or any other authority; (e) records relating to the draft order; (f) evidence collected by, or caused to be colleted by, it; and (g) result of any inquiry made by, or caused 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 sub-section (5) shall be issued unles ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... By this writ petition, the petitioner has prayed for issue of a writ of certiorari for quashment of the order dated 30th September, 2010 passed by the dispute resolution panel-II, the first respondent herein. What could have been a matter of debate was put to rest by Mr. Sanjeev Sabharwal, ld. Counsel for the revenue by stating that the order passed on 30th September, 2010, contained in Annexure-P1, deserves to be quashed and the matter be remanded to the said authority for fresh adjudication. In view of the aforesaid fair concession, the order dated 30th September, 2010 passed 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 an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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