9911796707
TMI Blog2024 (9) TMI 1721X X X X Extracts X X X X X X X X Extracts X X X X ..... l within period of limitation. Learned Authorized Representative for the assessee had no objection to the condonation of delay of 646 days in filing of appeal. The Explanation on behalf of Appellant Department of Revenue does not smack of malafides as the appellant has not gained anything by not filing appeal within period of limitation. Therefore, delay of 646 days in filing the appeal is condoned. 3. Brief facts of case are that the assessee is engaged in business of construction, development and sale of integrated townships and residential houses and apartments. The assessee filed the return of income on 28/09/2016 declaring loss of Rs.3,97,74,805/- which was subsequently revised on 30/11/2016 at a loss of Rs.1,93,73,902/-. The case was taken up for scrutiny. In view of the international transactions and "specified domestic transactions" with the AEs the case was referred to the Transfer Pricing Officer (TPO) for determination of arm's length price of such transactions. 4. The TPO passed the order u/s 92CA(3) of the Income Tax Act, 1961 on 31/10/2019 wherein adjustment u/s 92CA of the Income Tax Act, of Rs.10,13,16,65,100/- was proposed which included adjustment to purchase co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SC) FB & CIT v/s GM Knitting Industries (P) Ltd. (2015) 376 ITR 456 (SC) have settled the law that the relevant provisions in the Act out to be put to stricter interpretation only. Hon'ble Supreme Court decision in the case of Fiber Boards Pvt. Ltd. vs. CIT Bangalore in 62 taxmann.com 135/376 ITR 596(SC). Hon'ble Supreme Court, after duly considering all the decision, came to a conclusion that the ratio of the decisions in Rayala Corporation, Kolhapur Canesugar etc cannot be said to be ratio decidendi at all and it is really in nature of obiter dicta. It has also been held by Hon'ble Apex Court that these decisions don't have binding effect. In Shree Bhagwati Steel Rolling Mills vs Commissioner of Central Excise in Civil Appeal No. 4280 of 2007 prayer was made to reconsider earlier decision in the case of Fibre Boards P. Ltd.(2015) 52 taxmann.com. In order of Hon'ble Mumbai Tribunal in the case of Firemenich Aromatics (India) Pvt. Ltd vs ACIT Circle 4(2), Mumbai in ITA No.348 and ITA No.732/Mumbai/2014 analyzing decision of Hon'ble Supreme Court in the case of Kolhapur Cane Sugar Works Ltd. vs. Union of India (2000) 2SCC536 and held that the decision in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... & 2078/Del/2022 for A.Y. 2016-17. The issue of effect of omission of a particular section in the Act ha been decided by the Hon'ble Mumbai ITAT in the case of Firemenich Aeromatic India Pvt. Ltd. (Supra) and other Tribunals in different/conflicting ways. The decisions of Hon'ble ITAT Mumbai in the case of Firemenich Aeromatic India Pvt. And Hon'ble ITAT Delhi decisions in the case of Yorkn Tech Pvt. Ltd. it is seen that both the Tribunals have discussed Hon'ble Supreme Court decision in the cases of Shree Bhagwati Steel and Fiber Boards (cited supra) but interpreted the ratio of the decisions in totally different way and also came to a totally different conclusion. 11. Learned Authorized Representative for Revenue submitted that the case of DLF Urban Pvt. Ltd. vs. DCIT, Circle-7(1), in ITA No.2078/Del/2022 for A.Y. 2016-17. The case was heard on technical ground of omission of Section 92B(i) and it was reserved for orders. However, after that, the Hon'ble Bench refixed the matter for hearing on merits. Though the conflicting decisions of Firemenich Aeromatic India Pvt. of Mumbai, ITAT was cited and also the decisions of Hon'ble Apex Court in the case of Fiber Boards and Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat once this section is omitted w.e.f. 01.04.2017, the resultant effect is that it had never been passed to be considered as a law and never existed. However, in the light of the Explanatory Notes to the Finance Act, 2017 relied by the ld. DR along with the judgement of the Hon'ble Supreme Court in the case of Fiber Boards Pvt. Ltd. (supra) and Shree Bhagwati Steel Rolling Mills (supra) which have been considered by the Mumbai Bench in the case of Firemenich Aromatics (India) Pvt. Ltd. (supra) we need to decide the impact of the judgement of the Hon'ble nonjurisdictional High Court in a situation in which these decisions canvassed a view contrary to what has been decided by another nonjurisdictional High Court. 28. In this context, without much indulgence on our part, we would like to rely on the order of the Mumbai Bench of the Tribunal in the Siro Slimpharma Pvt. Ltd. vs. ITO in ITA No.847/Mum/2016, order dated 09/09/2021 wherein while dealing with somewhat similar question of law, the Mumbai Tribunal has indicated that in the absence of judgment of Jurisdictional High Court, the non-jurisdictional High Court judgment has persuasive value and should be generally followed. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... land". Of course, these observations were in the context of a provision being held to be unconstitutional, an issue on which the Tribunal could not have adjudicated anyway, as evident from the observation "Actually, the question of authoritative or persuasive decision does not arise in the present case because a Tribunal constituted under the Act has no jurisdiction to go into the question of constitutionality of the provisions of that statute" but nevertheless the respect for the higher judicial forum was unambiguous. In Tej International Pvt Ltd Vs DCIT [(2000) 69 TTJ 650 (Del)], a coordinate bench has, on this issue, observed that "In the hierarchical judicial system that we have, better wisdom of the Court below has to yield to higher wisdom of the Court above and, therefore, one a authority higher than this Tribunal has expressed an opinion on that issue, we are no longer at liberty to rely upon earlier decisions of this Tribunal even if we were a party to them. Such a High Court being a non-jurisdictional High Court does not alter the position...". . There can, however, be exceptions to this situation on account of a variety of reasons, and these exceptions come into play on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, constitute a binding a judicial precedent in all situations. To a forum like us, following jurisdictional High Court decision is a compulsion of law and absolutely sacrosanct that way, but following a non- jurisdictional High Court is a call of judicial propriety which is never absolute, as it is inherently required to be blended with many other important considerations within the framework of law, or something which cannot be, in deserving cases, deviated from. [Emphasis, by underlining, supplied by us] 8 At one place, this decision, inter alia, states that "To a forum like us, following a jurisdictional High Court decision is a compulsion of law and absolutely sacrosanct that way, but following a non-jurisdictional High Court is a call of judicial propriety -which can...be, in deserving cases, deviated from". Implicit in this observation is the fact that not following non- jurisdictional High Court decision is more of an exception than the rule. There have to be very strong and good reasons not to follow even non jurisdictional High Court decisions...." 29. On the basis of the aforesaid principles of law of precedents and taking into consideration the fact that in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... benefit of the same has to be given to the assessee. Thus, we are inclined to follow the Hon'ble Karnataka High Court judgement and, on that basis, the additional ground raised by the assessee deserves to be allowed and consequently the whole exercise done by Id. AO to bench mark the transaction of purchase of development right, stands being void. " 14. Above said para No.27 to 31 of order dated 08/04/2024 were relied on in ITA No.807/Del/2021 titled as Panacea Boitec Ltd. vs. ACIT decided on 22/05/2024 and it was further held that:- "11. From above observation, it is evident that the request/submission of learned departmental representative for reference to the President, ITAT to constitute Special Bench because ITAT Mumbai and Delhi Benches of equal strength have given conflicting judgments has been considered and not granted. Therefore the request of Learned departmental representative for reference to the President, ITAT is declined. 12. In view of above material facts and well settled principle of law, no transfer pricing adjustment can be made on account of domestic transaction which has been referred by the Learned Assessing Officer, after omission of Clause (i) of se ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
