9911796707
TMI Blog2022 (7) TMI 542X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. TPO on 01.11.2018 whereas the Ld. TPO was required to pass the order within 60 days prior to the date on which the period of limitation referred to in section 153 of the Act expires i.e. 31.10.2018. Hon'ble Madras High Court in case of M/s. Pfizer Healthcare India Pvt. Ltd. [ 2022 (4) TMI 808 - MADRAS HIGH COURT] while dealing with the issue held that for computing the period of 60 days, the last date as per section 153 should be excluded. Identical issue has been decided by the co-ordinate Bench of the Tribunal in case of ECL Finance Ltd. [ 2021 (9) TMI 1399 - ITAT MUMBAI] in favour of the assessee by following M/s. Pfizer Healthcare India Pvt. Ltd. (supra) Thus we are of the considered view that as per limitation prescribed under section 153 of the Act that assessment order was required to be passed within a period of 21 months from the end of assessment year i.e. A.Y. 2015-16 i.e. 31.03.2016, meaning thereby the assessment order under section 153(1) was to be completed within 21 months from the end of assessment year i.e. on 31.12.2017 with further extension of 12 months in case of transfer pricing reference as per section 153(4) of the Act was made which expires on 31.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case and in law, the learned AO /Transfer Pricing Officer ('TPO'), based on the directions of the Hon'ble DRP has: General Ground 1. Erred in assessing the total income of the Appellant at Rs.24,35,50,65,077 against a total income of Rs.17,36,67,02,180 as computed by the Appellant in its return of income. A. Transfer Pricing grounds 2. Erred in making a reference of the Appellant's case to the learned TPO under Section 92CA(1) of the Act, without satisfying any of the conditions laid down in clauses (a) to (d) of Section 92C(3) of the Act based on the information / documents available with him; Separate segmental margins 3. Erred in law and facts, in upholding that the international transactions of the Appellant of rendering IT and BPO services under the Delivery Centre Agreement ('DCA') are two distinct transactions (i.e. rendering of IT services and rendering of BPO services) which should be benchmarked separately. Provision of IT services 4. Without prejudice to Ground No. 3 above, the learned TPO has erred in determining the arm's length range to be 20.95% to 24.88% (with a median of 22.91%) for the IT services provided under the DCA. Economic Ana ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot allowing the Appellant the benefit of the risk adjustment to account for the difference between the risks taken on by the Appellant and the risks taken on by the comparable companies Transaction of royalty payment 15. Erred in rejecting the economic analysis undertaken by the Appellant using CUP method for benchmarking the royalty payment to AE, and instead determining the arm's length price to be at 1% of revenue on an ad hoc basis without using any of the methods prescribed under Section 92C of the Act read with Rule 10B of the Income Tax Rules, 1962. 16. Erred in allowing royalty payment at an ad hoc rate of 1% only for use of brand name and trademark: disregarding the fact that the royalty paid by the Appellant is for the entire portfolio of IP which also includes tools, technology, methodology, etc. 17. Erred in rejecting all the external royalty agreements that were identified by the Appellant as comparables to determine the arm's length price under the CUP method, by giving ad hoc and arbitrary reasons. 18. Without prejudice to the Ground I6and 17 above, erred in not accepting the alternate comparables set of three agreements submitted by the Appellant (on a witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ht to be raised is legal one which goes to the roots of the case affecting the jurisdiction of Ld. TPO to pass the order under section 92CA(3) of the Act. 3. The Ld. D.R. for the Revenue opposed raising of additional ground by the assessee on the ground that no such ground has been raised before the Lower Revenue Authorities. However, we are of the considered view that when additional ground sought to be raised by the assessee is a legal ground, which goes to the roots of the case and is also necessary to adjudicate the issue in controversy the same can be raised at any stage of the proceedings. Hence, additional ground raised by the assessee is allowed. 4. Briefly stated facts necessary for adjudication of the controversy at hand are : the assessee Accenture Solutions Pvt. Ltd. ( ASOL ) being the successor to the Accenture Services Pvt. LTd. (ASPL), is an Indian company engaged in providing Information Technology (IT) Services, BPO services and consultancy services. Presently the assessee operates out of several units located in the Software Technology Parks of India (STPI) and Special Economic Zone (SEZ) and claimed a deduction under section 10AA of the Act qua the profits earned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4) of the Act 31-12-2018 Time Limit for passing the order under section 92CA(3A) i.e. 60 days prior to the date prescribed under section 153 Less: Date on which limitation expires under section 153 i.e. 31-12-2018 1 day Less: Remaining days of December 30 days Less: Number of days of November 30 Days Due date for passing the order under section 92CA(3) of the Act i.e. 61 days from 31 December 31-10-2018 Date of passing the TP order under section 92CA(3) 01-11-2018 10. The Ld. A.R. for the assessee while discussing the factual position qua the order passed by Ld. TPO and statutory provisions applicable thereto contended inter alia that the order passed by Ld. TPO dated 01.11.2018 is not sustainable in the eyes of law being barred by limitation; that the last date to pass the TP order by Ld. TPO was 31.10.2018; that the order passed by the Ld. TPO is barred by limitation as the period of 60 days is completed in accordance with the provisions of section 153 of the Act by excluding the last date and relied upon the decision rendered by the Hon ble Madras High Court in case of M/s. Pfizer Healthcare India Pvt. Ltd. Ors. Vs. DCIT in WA No.1120 of 2021 ors. judgment dated 31.03.2022. 11. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, expires on 31.12.2019 that must stand excluded since Section 92CA(3A) states 'before 60 days prior to the date on which the period of limitation referred to Section 153 expires'. Excluding 31.12.2019, the period of 60 days would expire on 01.11.2019 and the transfer pricing orders thus ought to have been passed on 31.10.2019 or any date prior thereto. Incidentally, the Board, in the Central Action Plan also indicates the dale by which the Transfer Pricing orders are to be passed as 31.10.2019. The impugned orders are thus, held to be barred by limitation. 16. Identical issue has been decided by the co-ordinate Bench of the Tribunal in case of ECL Finance Ltd. vs. ACIT in ITA No.899/M/2018 order dated 22.09.2021 in favour of the assessee by following M/s. Pfizer Healthcare India Pvt. Ltd. (supra) case rendered by Hon ble Madras High Court. 17. In view of what has been discussed above and following the order passed by the Hon ble Madras High Court in case of M/s. Pfizer Healthcare India Pvt. Ltd. (supra) and order passed by the co-ordinate Bench of the Tribunal in case of ECL Finance Ltd. (supra), we are of the considered view that as per limitation prescribed under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by holding that the payment of employees contribution qua PF ESIC if made before the due date of filing of return of income, the same is allowable deduction as per provisions of Section 2(24)(x) r.w.s. 36(1)(va) r.w.s. 43B of the Act. 22. In view of what has been discussed above, we are of the considered view that since the amended provisions contained under section 43B read with section 36(1)(va) of the Act are not applicable for the year under consideration i.e. A.Y. 2015-16 as the amendment will be effective from A.Y. 2021-22 and the AO/ Ld. CIT(A) have erred in disallowing the same. Consequently, impugned order passed by the Ld. CIT(A) is set aside and as such ground No.21 is determined in favour of the assessee. Ground No.22 23. Assessee has come up with the ground that the AO has not granted credit of TDS for Rs.39,43,015/- deducted by the customers of the assessee for which rectification application dated 02.12.2019, available at page 68 69 of the paper book is already pending before the AO. Since the assessee is entitled for grant of credit of TDS AO is directed to dispose of the rectification application (supra) filed by the assessee within 2 months from the date of receip ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
