9911796707
TMI Blog2024 (9) TMI 951X X X X Extracts X X X X X X X X Extracts X X X X ..... it is not nice in law and could not have been allowed to continue. Further with respect to the appeals filed by the assessee also cannot be sustained as assessee did not furnish any permission obtained from National company law tribunal as held in Mrs. Jai Rajkumar v. Standic Bank Ghana Ltd. [ 2019 (1) TMI 1254 - MADRAS HIGH COURT ] The assessee neither complied by filing proper letter of authority nor sought further time. None of the directors remained present before us. Therefore, the appeal filed by the company in all the three appeals cannot be sustained in absence of any permission from the National company law tribunal or filing of the proper letter of authority by the insolvency resolution professional. In view of this, we dismiss the appeals filed by the assessee with the liberty to Assessee to file these appeals after moratorium period, if Assessee wants to continue with these proceedings, making the respective representative of committee of creditors, IRP. Thus, all the appeals of assessee with respect to these three years are dismissed. - MS. KAVITHA RAJAGOPAL, JUDICIAL MEMBER AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER For the Appellant : Shri Subhash Gupta Shri Ajinkya K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the audited segmental profit and loss account 6. Erred in not considering the audited segmental profit and loss account submitted by the Appellant on the basis of untenable reasons. 7. Learned DRP has erred in upholding rejection of segment profit and loss accounts relying upon the DRP directions of AY 2012-13, AY 2013-14 and AY 2014-15, without appreciating the facts involved in AY 2016-17. Incorrect computation of Appellant's entity level margin 8. without prejudice to the above, erred in computing the Appellant's net level margin at 0.41% (PLI as OP/OI), as against margin of 0.12% by considering Other Income of INR 339 lacs as non-operating, which comprises of insurance claim of INR 1 lacs and other miscellaneous income of INR 338 lacs. Economic Adjustment 9. Without prejudice to the above, appropriate economic adjustment should be granted to the Appellant for differences such as working capital employed by the Assessee vis a vis comparable companies. Addition on account of corporate tax adjustments Disallowance of additional depreciation under section 32(1)(iia) of the Act amounting to INR 3, 43,808/- 10. Erred in disallowing 50% of the additional depreciation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. Erred in determining the Appellant's total income at INR 77,37,46,936 as against the returned income of INR 22,45,33,750/- disclosed under the normal provisions of the Act in the revised return of income filed by the Appellant. Addition on account of transfer pricing adjustments General 2. Erred in making an adjustment of INR 54,92,13,186/- to the total income of the Appellant under Section 92CA(3) of the Act on account of adjustment in the arm's length price of the impugned international transaction relating to the manufacturing function. Rejection of functional and economic analysis undertaken by Appellant 3. Erred in rejecting the functional and economic analysis undertaken by the Appellant in accordance with the provisions of the Act read with the Income-tax Rules, 1962 ( the Rules ) in respect of the impugned international transaction relating to the manufacturing function. 4. Erred in violating the provisions of Rule 10B(1)(e) the Rules, by not considering the comparison of net profit margin realized by the Appellant from an alleged controlled transaction vis- -vis net profit margin realized by the Appellant from a similar uncontrolled transaction and thereby rejec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01,55,680 disclosed under the normal provisions of the Act in the computation of income filed by the Assessee. Transfer Pricing Grounds 2. Erred in making an adjustment of INR 25,37,41,498/- to the total income of the Assessee under Section 92CA(3) of the Act on account of non-charging of interest from associate enterprises ('AEs') on outstanding trade receivables. Transfer pricing adjustment on account of notional interest on outstanding receivables amounting to INR 25,37,41,498/- On the facts and in the circumstances of the case and in law Outstanding receivables is not an international transaction under section 92B of the Act 3. The learned TPO erred in appreciating the fact that the accounts receivables from AEs is an outcome of the international transaction and not an international transaction under section 92B of the Act, 1961 ('Act') and hence the transfer pricing regulations should not apply to the same. Recharacterisation of accounts receivables into loans is judicially not permissible 4. The learned TPO has erred in recharacterizing accounts receivables as loans without appreciating that recharacterisation of international transaction is not judicially per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lter, vary, omit, substitute or amend the above grounds of appeal, at any time before or at the time of hearing of the appeal, so as to enable the Hon'ble Members to decide this appeal according to law. 4. These three appeals filed by the assessee and During the course of hearing, at the outset, we noticed that in the case of the assessee, the matter is pending before the Insolvency Professional in terms of the Insolvency and Bankruptcy Code, 2016 ( the Code ) and moratorium period has been declared as per section 14 of the Code. Apparently, the provisions of section 14 of the Insolvency and Bankruptcy Code, 2016, provides that all these suits or continuation of pending suits or proceedings against the corporate debtor including any judgment or decree or order in any court of law, tribunal, arbitration panel or other authority cannot be passed during the moratorium period. The period of moratorium shall have the effect from the date of such order till the completion of the corporate insolvency resolution process. In the present case, the appeal filed by the assessee is prohibited under section 14 of the Code. As held by the Supreme Court in case of Alchemist Asset Reconstructio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Interim Resolution (IRP) for conducting the CIRP and exercise all powers and subject to all duties as contemplated under the provisions of the IBC. Moratorium period is also declared. 7. Further with respect to the appeals filed by the assessee also cannot be sustained as assessee did not furnish any permission obtained from National company law tribunal as held by the honourable madras High Court in Mrs. Jai Rajkumar v. Standic Bank Ghana Ltd. [2019] 101 taxmann.com 329 (Mad.). The assessee neither complied by filing proper letter of authority nor sought further time. None of the directors remained present before us. Therefore, the appeal filed by the company in all the three appeals cannot be sustained in absence of any permission from the National company law tribunal or filing of the proper letter of authority by the insolvency resolution professional. Accordingly all the appeals with respect to above three companies filed by the assessee are dismissed with the liberty to file them a fresh appeal on completion of moratorium period or when corporate insolvency is resolved, as the situation may be. 8. In view of this, we dismiss the appeals filed by the assessee with the libe ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
