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TMI Blog2014 (8) TMI 1028X X X X Extracts X X X X X X X X Extracts X X X X ..... or sustaining the addition made with regard to the payment of technical fee, training fee, testing expenses, payment of modification of tools and payment of design and development expenses. The DRP also has allowed the royalty payment and disallowed the other allied payments. For arriving at the above decision, DRP has not given any cogent reasons. In these circumstances, in our considered opinion, the addition on account of arm's length price amounting to ₹ 26,48,678/- is not sustainable. We are not inclined to interfere with the order passed by the Tribunal. - Decided against revenue - ITA 143/2014 - - - Dated:- 8-8-2014 - MR. SANJIV KHANNA MR. V. KAMESWAR RAO JJ. For the Appellant: Mr.Sanjeev Sabharwal, Senior Standi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of ₹ 1,56,43,832/- as recommended by the Transfer Pricing Officer was not accepted. Payment of royalty of ₹ 1,56,43,832/- was accepted as Arms Length Price/consideration. However, addition of ₹ 26,48,678/- was sustained. The reason given by the Dispute Resolution Panel was that while payment of royalty might be justified, other payments cannot be held at arm's length as either the service claimed to be received was subsumed in the payment of royalty or the supposed service was of such nature that it partook the character of a shareholder's service. Further, if indeed such a service was provided by the associate enterprise, it was towards preserving its inherent interest in the assessee's business. We have res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sis for sustaining the addition made with regard to the payment of technical fee, training fee, testing expenses, payment of modification of tools and payment of design and development expenses. '8.3 The DRP also has allowed the royalty payment and disallowed the other allied payments. For arriving at the above decision, DRP has not given any cogent reasons. In these circumstances, in our considered opinion, the addition on account of arm's length price amounting to ₹ 26,48,678/- is not sustainable. 8.4 Now we deal with the Ld. Departmental Representative's submissions that the matter may be remitted to the file of the TPO to give a detailed and proper finding on allied payments other than royalty. 8.5 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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