9911796707
TMI Blog2013 (11) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... ricted only to such receipts which have an element of profit in it – Provisions of section 80HHC relevant in this context are analogous to the provisions of Section 80HHE – Keeping in view the setting aside of the first issue of the case the enhancement by TPO’s order will have no impact - The proviso to Section 92C(4) prohibits any deduction under Chapter VI-A to be allowed on the enhancement made as per the TPO’s order - No effect is to be given to the addition made by the Assessing Officer as per the TPO’s order while computing deduction under Chapter VI-A – Decided against Revenue. - ITA No.4338/Del/2011, Cross-objection No.374/Del/2011, ITA No.4339/Del/2011, ITA No.4573/Del/2011 - - - Dated:- 21-12-2012 - Shri G. D. Agrawal And Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he comparables given by the assessee in the field of engineering, drawing and design services, has not allowed any opportunity to the AO/TPO to rebut the comparables given by the assessee. He, therefore submitted that either the order of the learned CIT(A) should be sustained or the matter can be set aside to his file or even to the file of the TPO. 4. The learned DR, on the other hand, stated that on the facts of the assessee s case, it would be fair if the matter is set aside to the file of the TPO and he is directed to readjudicate the issue in the light of his own order for AY 2008-09. 5. In view of the above submission of both the parties, we set aside the orders of the authorities below on this point and restore the matter to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the said amount. He fairly pointed out that Section 92C(4) provides that no deduction under Chapter VI-A shall be allowed in respect of the amount of income by which the total income is enhanced as per the computation under Section 92C. Therefore, the Assessing Officer is not at all justified in enhancing the total turnover by the adjustment made under Section 92C. With regard to the increase of total turnover by reimbursement of expenses, it was pointed out by the learned counsel that this issue is covered in favour of the assessee by the decision of the Tribunal in assessee s own case for AY 2001-02 2002-03 vide ITA Nos.4278/Del/2005 and 1803/Del/2006. He, therefore, submitted that the order of the learned CIT(A) on this point is in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submissions and also perused the relevant material on record. It is observed that the reimbursement of expenses actually incurred by the assessee company on behalf of its clients was claimed by it from them as per the agreement and even the bills for such reimbursement were separately raised by it on the concerned customers as is evident from the details furnished by the learned counsel for the assessee at page Nos.25 to 27 of his paper book. The reimbursement so claimed was only to the extent of the expenses actually incurred by the assessee company on behalf of its clients and it is not even the case of the Revenue that any profit element was involved in such reimbursements. In the case of CIT Vs. Industrial Engineering Projects Pvt.Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es in its turnover for the purpose of computing deduction u/s 80HHE. The same is, therefore, upheld and ground No.2 of the Revenue s appeal is dismissed. 12. Respectfully following the above decision of ITAT, we uphold the finding of the learned CIT(A) with regard to reduction of reimbursement of expenses from the total turnover. 13. With regard to addition made by the Assessing Officer in the total turnover by the amount of adjustment made as per TPO s order, we find that Section 92C(4) reads as under:- (4) Where an arm s length price is determined by the Assessing Officer under sub-section (3), the Assessing Officer may compute the total income of the assessee having regard to the arm s length price so determined : Provided that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ally, the total income. If all three are increased, obviously, the deduction claimed by the assessee under Chapter VI-A would increase. The proviso to Section 92C(4) prohibits any deduction under Chapter VI-A to be allowed on the enhancement made as per the TPO s order. Therefore, the only logical conclusion that can be drawn is that no effect is to be given to the addition made by the Assessing Officer as per the TPO s order while computing deduction under Chapter VI-A. The Assessing Officer s view cannot be accepted that by the enhancement of income as per the TPO s order, only the total turnover would be increased and not the export turnover or the total income. In view of the above, we uphold the order of learned CIT(A) on this point al ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
