9911796707
TMI Blog2016 (4) TMI 1139X X X X Extracts X X X X X X X X Extracts X X X X ..... as raised following grounds : "General Grounds 1. That the Ld. Assessing Officer (AO) / Hon'ble Dispute Resolution Panel (DRP) erred in computing the total income of the Appellant at Rs. 343,103,020/- as against the returned income of Rs. 129,003,431/-. 2. That the DRP/Ld. Transfer Pricing Officer (TPO) erred in making an adjustment of Rs. 217,399,859/- under section 92CA(3) of the Income Tax Act, 1961 ("the Act") in respect of the "advertising and marketing expenses"(AMP expenses) incurred by the Appellant for its own business purposes. Transfer pricing grounds 3. That the Ld. TPO/AO/DRP erred in segregating "AMP transaction" after having accepted the arm's length price of all other transactions under TNMM and having accepted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of DRP to correct the amount of claim of warranty expense made by the appellant with respect to the warranty provision while computing the taxable profits during the financial year. Common ground 11. Ld. AO has erred, in charging interest under sections 234B and 234C of the Act. 12. That on facts and in laws, the Ld. AO erred in holding that the Appellant has furnished inaccurate particulars of income in respect of each item of disallowance/ additions and in initiating penalty proceedings under section 274 read with section 271(1)(c) of the Act." 2. Ground no. 1 and 2 are general in nature and ground no. 12 is raised prematurely so these grounds do not require any comments on our part. 3. Ground nos. 3 to 9 relate to the addition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of SAD written off. When confronted to explain the claim, the assessee submitted that the similar disallowance was made in the assessment year 2010-11 which was confirmed by the DRP. The AO therefore, made the similar disallowance for this year also. The AO proposed the draft assessment order and recomputed the income at Rs. 105,03,22,510/- as under :- Total Income as per return filed 33,78,63,271/- Add:- Transfer Pricing Adjustment 71,23,76,838/- Disallowance of SAD written off 82,399/- Total Income 1,05,03,22,508/- Total Income (rounded off u/s 288A) 1,05,03,22,510/- 5. The assessee filed objection dated 17.02.2015 to the draft assessment order before the DRP-II, New Delhi who vide order dated 15.12.2015 dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a) Pvt. Ltd. vs. A.C.I.T. in I.T.A. No. 643 & 675/14 order dated 23.12.2015 examined this aspect and applied the same principle to distribution business as well. It was further submitted that DRP and the TPO failed to give any cogent reason for de-bundling the AMP function of the assessee as a separate transaction which is in violation of the principles laid down in the case of Sony Ericsson Mobile Communications India Pvt. Ltd reported at (2015) 55 Taxman.com.240(Del.) (Supra). 7. In his rival submissions, the ld. DR although supported the order of the AO could not controvert the aforesaid contention of the Ld. Counsel for the assessee. 8. We have considered the submissions of both the parties and perused the material available on the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g heard to the assessee. 9. The next issue vide ground no. 10 relates to the claim of warranty expenses. The only grievance of the assessee relating to this issue is that the AO has not followed the directions given by the DRP while deciding this issue. It is noticed that the objection of the assessee before the DRP was that the AO had not corrected the claim of warranty expenses made by the assessee with respect to the warranty provisions while computing the taxable process. The DRP directed the AO to verify and correct, if any errors were detected. It appears that the AO did not follow the said directions given by the D.R.P. relating to warranty claim, therefore, this issue is set aside to the file of the AO to be decided afresh as direc ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
