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TMI Blog2020 (7) TMI 468X X X X Extracts X X X X X X X X Extracts X X X X ..... tical in A.Y.2003-04, in our considered opinion, the decision taken by this Tribunal in assessee s own case for the A.Yrs. 2002-03, 2004-05 and 2005-06 would squarely apply to this assessment year also and accordingly, we dealt the addition made towards manning services fee on account of transfer pricing adjustment. We find that the ld. CIT(A) had already granted relief to the extent of ₹ 2,14,48,677/- in this regard and had confirmed only the remaining sum of ₹ 5,00,47,881/-. At the time of hearing, both the parties informed that no appeal was preferred by the revenue against such relief granted by the ld. CIT(A). Accordingly, the ground No.4 raised by the assessee is allowed. - ITA No. 6203/Mum/2010 - - - Dated:- 17-7-2020 - Shri M. Balaganesh, AM And Shri Ram Lal Negi, JM For the Assessee : Shri Uodol Raj Singh For the Revenue : Shri Nishant Thakkar ORDER PER M. BALAGANESH (A.M): This appeal in ITA No.6203/Mum/2010 for A.Y.2003-04 arises out of the order by the ld. Commissioner of Income Tax (Appeals)-15, Mumbai in appeal No. CIT(A)-15/IT-101/Addl.CIT-Rg.8(1)/06-07 dated 03/09/2010 (ld. CIT(A) in short) against the order of assessment pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rental income towards repairs under head income from house property and no further deduction is eligible to the assessee. We find that the rental income offered by the assessee in the sum of ₹ 57,500/- was only in respect of 100 sq.ft of premises let out for five months. Hence, the corresponding flat deduction @30% towards repairs under the head income from house property was also given only for a period of five months. No deduction for the remaining 7 months has been given, in terms of the provisions of Section 38(2) of the Act. We find that assessee is entitled for proportionate deduction for the remaining period of seven months of these repairs and maintenance in respect of 100 Sq.ft of property. Accordingly, the ground No.3 raised by the assessee is partly allowed. 4. The issue to be decided in this appeal is with regard to action of the ld. CIT(A) in confirming the addition made on account of manning services fee of ₹ 6,82,62,238/- being the arm s length price adjustment made by the ld. TPO. 4.1. We have heard the rival submissions and perused the materials available on record. Both the parties before us fairly stated that this issue is covered in ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arm s length price of fee for manning services@ US $ 120 per person per month for the impugned assessment year which worked out to ₹ 9,54,19,817. Considering the fact, the assessee has charged fee of ₹ 3,75,14,882, to the AE towards manning services, he made an adjustment of ₹ 5,79,04,935, which was added to the income of the assessee by the Assessing Officer while framing the assessment. Though, the assessee challenged the aforesaid addition before learned Commissioner (Appeals), however, was unsuccessful. 6. The learned Counsel for the assessee, at the very outset, submitted that while deciding identical dispute in assessee s own case for the assessment year 2002 03, the Tribunal in ITA no.6160/Mum./ 2010, dated 7th February 2018, has accepted the price charged by the assessee to be at arm's length and deleted the addition. Further, he submitted, the same view was expressed by the Tribunal while deciding identical issue in assessee s own case in assessment year 2005 06, in ITA no.2404/ Mum./2012, dated 27th April 2018. He submitted, the facts involved in the impugned assessment year relating to the disputed issue is identical to the facts involved in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d materials on record. From the impugned order of the Transfer Pricing Officer it is evident that on the basis of information obtained under section 133(6) of the Act, in course of transfer pricing proceedings of the assessee for assessment year 2002 03, the Transfer Pricing Officer has applied the rate charged by M/s. Confidence Shipping Co. towards provision of manning services. In fact, the TPO while adopting the rate charged by M/s. Confidence Shipping Co. has categorically stated that there is no material difference in fact involved between assessment year 2002 03 and the impugned assessment year. On a perusal of the order dated 7th February 2018, passed in assessee s own case by the Tribunal, for assessment year 2002 03 in ITA no.6160/Mum./2010, it is noticed that while deciding identical issue relating to transfer pricing adjustment made on fees charged for manning services the Tribunal has deleted the addition holding as under: 5. Before the CIT(A) as well as before us, assessee has raised multiple submissions in order to assail the tradition. Such submissions, inter-alia, include the in-appropriateness of considering the data provided by Confidence Shipping Company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Exchange rate as per TPO 48.80 Therefore, charge per man month in US$ as per BSMI 150.28 Charge per man month as per TPO in US$ 150.00 Excess received by BSMI in US$ 0.28 2 As per TPO/ITO: Manning fee as per TPO @ US$ 150/- per man month for 12,213 man months 89,325,960 3 On Received basis : Manning fee included in P L A/c 21,697,822 Add : Expenses Received 69,451,805 Total 91,149,627 91,149,627 No. of man months as per TPO 12,213 Therefore, charge per man month ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee and find that the same is potent. The relevant details which we have extracted above, clearly suggest that assessee incurred expenses for providing manning services to the extent of ₹ 6,38,78,901 which were reimbursed by its associate enterprise. At the time of the hearing, our attention has also been drawn to the payments terms and conditions annexed to the Technical Management and Consultancy Agreement, which inter-alia, included clause 5 which reads as under:- 5. First Party shall provide free of cost following facilities to the personnel deputed by Second Party and for that purpose reimburse expenses incurred by the Second Party on behalf of First Party. Salaries and perquisites of personnel. Approriate lodging and boarding facilities. Local transportation for due performance of duties and personal use. To and fro air passage. Medical facilities. It has been clarified before us, that the reimbursement of the expenses of ₹ 6,38,78,901 is governed by above clause 5 of the arrangement with the associated enterprise. Notably, the TPO in page 10 of his order has reproduced the details of expenses reimbursed by the associate ent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed in the present appeal as well. Therefore, respectfully following the decision of the Co ordinate Bench in assessee s own case as referred to above, we delete the addition made on account of transfer pricing adjustment of manning services as made by the Assessing Officer and sustained by the learned Commissioner (Appeals). The grounds raised are allowed to the extent indicated above. 2. Facts relating to the disputed issue being identical in the impugned assessment year, in our considered opinion, the decisions taken by the Tribunal in assessee s own case for the assessment years 2002 03 and 2005 06 on identical issue, as referred to above, would squarely apply to the issue raised in the present appeal also. That being the case, respectfully following the aforesaid decisions of the Tribunal in assessee s own case, we delete the addition made of ₹ 5,79,09,935, on account of transfer pricing adjustment to manning services. This ground is allowed. 4.2. The facts relating to the disputed issue being identical in A.Y.2003-04, in our considered opinion, the decision taken by this Tribunal in assessee s own case for the A.Yrs. 2002-03, 2004-05 and 2005-06 would squarely ..... X X X X Extracts X X X X X X X X Extracts X X X X
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