9911796707
TMI Blog2013 (11) TMI 141X X X X Extracts X X X X X X X X Extracts X X X X ..... cent. figure comes to Rs. 12,31,972,759 while the (+) 5 percent comes to Rs. 13,61,654,102 whereas the appellant's price is Rs.13,52,402,382 which falls within the permitted range of 5 percent. Deduction u/s 43B – Held that:- The entire amount was paid before the closure of the financial year or within the due date for filing the return of Income – Decided against Revenue. - - - - - Dated:- 7-11-2012 - Order This is a Revenue's appeal against the orders of the Commissioner of Income-tax (Appeals)-15 Mumbai, dated July 27, 2010. The Revenue has raised the following grounds: "1. On the facts and in the circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) erred in deleting the addition of Rs. 9,3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transaction (Rs.) Receipt (Rs.) Paid (Rs.) 1 Provision of international transport-ation services to the assessee within India 15,26,47,723 NA 2 Provision of international transportat-ion services by the assessee outside India NA 99,89,70,718 3 Allocation of leased-line expenses 2,22,93,580 4 Transfer of minor equipment 1,52,659 The above referred transactions were duly reported by the assessee in Form 3CEB which was filed along with the return of income for the assessment year 2004-05. The Assessing Officer under section 92CA(1) of the Act, refer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 10D(4). Further, the Transfer Pricing Officer in its order dated November 28, 2006 was of the view that transactional net margin method is the most appropriate method and identified two companies-Patel On-Board Couriers Ltd. ("Patel On-Board") and Skypark Services Specialist Ltd. ("Skypark") as comparable companies for benchmarking the appellant's international transactions. Based on the transactional net margin method analysis, the Transfer Pricing Officer arrived at the arm's length margin of 3.61 per cent. (using margins of the two comparables as follows : Patel On Board 3.85 per cent. and Skypark 3.37 per cent.) in respect of the international transactions of the assessee. Given that the margin earned by the assessee did not fall wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer-II also agreed with the assessee on the second issue, i.e., erroneous computations of the margins of the comparables and that of the assessee. The Transfer Pricing Officer-II agreed and concluded that consistency needs to be followed while calculating the margins of the comparables vis-a-vis that of the assessee. The Transfer Pricing Officer-II however, did not agree with the assessee's contention on the third issue on the basis that working capital difference between the assessee and the two comparables is not highly varied. The relevant extracts from the remand report of the Transfer Pricing Officer-II was as under: " On perusal of pages 25 and 36 of the annual report, it is seen that an entity-wide level Patel On-board is en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0.46% 1.90% Considering the remand report of the TPO-II, the Commissioner of Income-tax (Appeals) allowed the relief to the assessee by stating as under: "3.20 I have examined the above contentions of the appellant as well as the remand report. The Transfer Pricing Officer has fairly conceded to the appellant's contention that the segmental data for Patel On-Board needs to be taken and that there was inconsistency in considering certain income/expense items in margin calculation of the comparable vis-a-vis that of the appellant. Based on that, the Transfer Pricing Officer-II in his remand report has considered the margin of the appellant at -3.06 per cent and the arithmetic mean operating margin of the comparabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income- tax (Appeals) allowed the amount as they are within the allowable grace period of 5 days, the Revenue is aggrieved. We do not see any reason to interfere with the order of the Commissioner of Income-tax (Appeals) as the disallowance under section 43B is not required when the amounts are paid within the grace period allowed under the respective Acts. Not only on legal principles but also on the fact that the entire amount was paid before the closure of the financial year or within the due date for filing the return as provided, we uphold the order of the Commissioner of Income tax (Appeals) and dismiss the Revenue's ground No. 2. In the result, the appeal filed by the Revenue is dismissed. The order pronounced in the open court on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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