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TMI Blog2023 (8) TMI 715X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant : Nikhil Tiwari For the Respondent : Manoj Kumar ORDER Per Amarjit Singh (AM): The present appeal filed by the assessee is directed against the order passed by the Ld. CIT(A)-58, Mumbai dated 25.03.2015 for A.Y. 2009-10. The assessee has raised the following grounds before us: General Ground 1. erred in upholding the action of the Deputy Commissioner of Income-tax 8(3), Mumbai ('learned AO) in determining the total taxable income of the Appellant for the subject AY at Rs. 7,04,44,370 instead of the amount of Rs. 1,14,98,477 as reported under Section 115JB of the Act, in the return of income filed by the Appellant. 2. erred in accepting the contentions of the learned AO of making a reference of the Appellant's case to the Deputy Commissioner of Income-tax II(8), Mumbai (learned TPO) under Section 92CA(1) of the Act, without satisfying the conditions specified therein, A. Transfer Pricing Grounds 3. erred in upholding the learned TPO's contentions for making a transfer pricing adjustment of Rs. 11,91,65,955 under Section 92C(4) of the Act to the total income of the Appellant on the premise that the international ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the revised return of income has not been considered while computing the transfer pricing adjustment Payment made for availing consultancy services 11. erred in upholding the learned TPO's action of determining the arm's length price of the international transaction of availing consulting services from its AE amounting to Rs. 99,27,601 to be Nil by rejecting the benchmarking analysis undertaken by the Appellant using the CUP method; Payment made towards cost allocations on account of intra-group services received 12. erred and upholding the learned TPO's action of determining the arm's length price of the international transaction pertaining to cost allocation payment of Rs. 5,66,39,404 (corrected amount aggregating to Rs 4,00,99,212) to its AEs, to be Nil, 13. erred in not adjudicating on the error highlighted by the Appellant as regards the amount disclosed in the Form 3CEB in respect of international transaction pertaining to payment of regional allocated cost, value of the said transaction was inadvertently reported as an expense of Rs. 1,29,00,270 (Rs. 82.70,094 plus Rs. 46,30,174) instead of income of Rs. 36,39,920 Pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the AIR information as pointed out to him by the Appellant, on the basis that additional evidence was filed by the Appellant. Levy of interest under Sections 234A and 2348 of the Act 20. erred in confirming the levy of interest under Sections 234A and 234B of the Act which is not in conformity with law Each of the above grounds is independent and without prejudice to one another. The Appellant craves leave to add, to alter, to amend or to delete any or all of the above grounds of appeal, at or prior to hearing of the appeal. The Appellant prays that appropriate relief be granted based on the above grounds of appeal and the facts and circumstances of the case. 2. Fact in brief is that return of income declaring total income of Rs. 2,17,30,848/- was filed on 30.09.2009. The case was subject to scrutiny assessment. The assessee company is engaged in the business of Consultancy Services in the areas of Human Resources Development, compensation benefit, employee benefits, actuarial services, remuneration data collection and other HR Consultancy services. During the year under consideration the assessee has reported the international transaction with its as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court of India in the case of National Thermal Power Company Vs. CIT (229 ITR 383) these ground of appeal are adjudicated and are taken for adjudication. 6. As per additional ground the order of the ITAT is barred by limitation, therefore, the assessee does not become eligible assessee u/s 144C of the Act, therefore, the draft assessment order dated 20.03.2013 and the final assessment order passed by the AO on 26.04.2013 were barred by limitation. 7. The ld. Counsel vide detailed submission dated 01.12.2022 submitted that order passed by the Transfer Pricing Officer on 30.01.2013 is time barred by 1 day since impugned order would have been passed on or before 29.01.2013. The ld. Counsel further submitted that as per provision of Sec. 92CA(3A) of the Act in a case where the reference is made to the TPO, the TPO is required to pass order u/s 92CA(3A) of the Act on any time before 60 days prior to the date on which the period of limitation referred u/s 153 of the Act expires. The ld. Counsel further submitted that since proviso employer words prior to date the day on which limitation expires is required to be included while computing the period of 60 days and the peri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-section (3) may be made at any time before sixty days prior to the date on which the period of limitation referred to in section 153, or as the case may be, in section 153B for making the order of assessment or reassessment or recomputation or fresh assessment, as the case may be, expires: Section 153(1) Time limit for completion of assessment and reassessments- (1) No order of assessment shall be made under section 143 or section 144 at any time after the expiry of (a) Two years from the end of the assessment year in which the income was first assessable, or (b) (b) One year from the end of the financial year in which a return or a revised return relating to the assessment year commencing on the 1 st day of April, 1988, or any earlier assessment year, is filed under sub-section(4) or sub-section (5) of section 139, whichever is later: Provided xxxxxxxxxxx Provided further xxxxxxxxxx Provided also that in case the assessment year in which the income was first assessable is the assessment year commencing on the 1 st day of April, 2009 or any subsequent assessment year and during the course of the proceeding for the assessment of total inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lating the 60 days, 31-12-2019 must be excluded. The usage of the word prior is not without significance. It is not open to this court to just consider the word to by ignoring prior . The word prior in the present context, not only denotes the flow of direction, but also actual date from which the period of 60 days is to be calculated. It is settled law that while interpreting a statute, it is not for the courts to treat any word(s) as redundant or superfluous and ignore the same. In this connection, it is pertinent to note the judgment of the Apex Court in Grasim Industries Ltd. v. Collector of Customs 2002 taxmann.com 1803, wherein, it was held as follows : 10. No words or expressions used in any statute can be said to be redundant or superfluous. In matters of interpretation one should not concentrate too much on one word and pay too little attention to other words. No provision in the statute and no word in any section can be construed in isolation. Every provision and every word must be looked at generally and in the context in which it is used. It is said that every statute is an edict of the legislature. The elementary principle of interpreting any word while co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t date is taken to be the first date from which the period of 60 days is to be calculated, reading down the provision with the use of the word from , which denotes the starting point or period of direction in general parlance, would mean that 60 days from the last date . Even going by section 9 of the General Clauses Act, when the word from is used, then, that date is to be excluded, implying here that 31-12-2019 must be excluded. After excluding 31-12-2019, if the period of 60 days is calculated, the 60th day would fall on 1-11-2019 and the TPO must have passed the order on or before 31-10-2019 as orders are to be passed before the 60th day. Therefore, either way the contention of the Revenue is a fallacy and has no legs to stand. Mandatory or Directory 31. The next contention that has been raised by the learned senior standing counsel for the appellants is that the usage of the word may in section 92CA (3A) indicates that the time fixed is only directory, a guideline, not mandatory and is for the sake of internal proceedings. 32. Let us now examine the relevant procedures relating to Transfer Pricing. After an international transaction is noticed subject to s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment year. It is only if a reference is pending, the department gets another 12 months. Once reference is made and after availing the benefit of the extended period to pass orders, the department cannot claim that the time limits are not mandatory. Hence, the contention raised in this regard is rejected. 36. As rightly pointed out by Mr. Ajay Vohra, learned senior counsel for the respondents in WA. Nos.1148 and 1149/2021, the word may has to be sometimes read as shall and vice versa depending upon the context in which it is used, the consequences of the performance or failure on the overall scheme and object of the provisions would have to be considered while determining whether it is mandatory or directory. 37. At this juncture, it is noteworthy to mention the commentary of Justice G. P. Singh on the interpretation of statutes, Principles of Statutory Interpretation (1st Edn., Lexis Nexis 2015), which is quoted below for ready reference: ' The intention of the legislature thus assimilates two aspects: In one aspect it carries the concept of meaning i.e. what the words mean and in another aspect, it conveys the concept of purpose and object or the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he date on which orders are to be passed by the TPO, reiterating the time limit to be mandatory. After taking into consideration the material placed on record it is undisputed fact that transfer pricing officer has passed order u/s 92CA(3) on 30.01.2013 whereas the limitation for passing the said order u/s 92CA(3) expires on 29.01.2013. Therefore, taking into consideration the provision of the Act and decision of Hon ble Madras High Court in the cases referred supra the order u/s 92CA(3) of the Act is time barred by 1 day. Further the ld. Counsel has mentioned the provisions of Sec. 144C(15) of the Act pertaining to the eligible assessee the same is reproduced as under: (b) eligible assessee means (i) Any person in whose case the variation referred to in sub-section(1) arises as a consequence of the order of the Transfer Pricing Officer passed under sub-section (3) of section 92CA; and (ii) (ii) any non-resident not being a company, or any foreign company. After referring the aforesaid provisions the ld. Counsel contended that since the order of the TPO was barred by limitation, therefore, there was no eligible assessee in the case of the assessee in te ..... X X X X Extracts X X X X X X X X Extracts X X X X
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