CAMBRIDGE UNIVERSITY PRESS AND ASESSMENT INDIA PRIVATE LIMITED,INDIA vs. DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER, DELHI

ITTPA 5/DEL/2026Status: DisposedITAT Delhi24 April 2026AY 2022-2313 pages
AI SummaryPartly Allowed

What were the facts?

The assessee, Cambridge University Press and Assessment India Pvt. Ltd., filed an appeal against the assessment order dated 23.12.2025 passed by the Assessing Officer (AO) under Section 143(3) read with Sections 144C(13) and 144B of the Income Tax Act, 1961. This order was in conformity with the directions of the Dispute Resolution Panel (DRP)-1, New Delhi, dated 09.12.2025, and the subsequent order giving effect to DRP directions dated 07.01.2026. The assessee is engaged in publishing, printing, and trading books, and providing business support services to its Associated Enterprises (AEs). The dispute primarily concerns an adjustment of Rs. 54,183,096 to the total income on account of the alleged difference in the arm's length price (ALP) of international related party transactions related to management support services.

What did the Tribunal hold?

The Tribunal held that the final assessment order passed by the AO under Section 143(3) read with Section 144C(3) and 144B, dated 28.10.2024, was bad in law and null and void because it was passed without incorporating the directions of the DRP. The Tribunal noted that as of the date of the hearing, the TPO had not passed any order as directed by the DRP, and the limitation period for passing such an order had expired. Therefore, following the jurisdictional High Court's decision in ESPN Star Sports Mauritius S.N. C. E. T. Compagnie V. Union of India and a coordinate bench decision in Global One India Private Limited Vs. DCIT, the Tribunal quashed the assessment order. Consequently, Grounds 1 and 2 of the assessee's appeal were allowed. Since the assessment order was quashed on a legal issue, all other grounds relating to the merits of the case were rendered academic and were left open. The Tribunal also observed that even on merits, there was no basis for the transfer pricing adjustment. The TPO had applied the 'Other Method' to determine the ALP at Rs. Nil without any comparable uncontrolled transactions, while the assessee's TNMM analysis yielded an arm's length range within which the markup earned by the AE fell. Rule 10AB of the Income Tax Rules mandates bringing comparable uncontrolled transactions on record when using the 'Other Method'. Therefore, the Tribunal held that there was no case for the revenue to make the impugned adjustment, and Grounds 1 to 5 were allowed on merits as well.

What were the issues?

1. Whether the AO erred in not issuing the final assessment order in conformity with the directions of the DRP and the order of the TPO, thereby violating mandatory provisions of Section 144C(10) read with 144C(13) and Section 92CA(4) of the Act, making the assessment order bad in law and liable to be quashed? 2. Whether the DRP, TPO, and AO erred in making an adjustment of Rs. 54,183,096 to the total income on account of the alleged difference in the arm's length price (ALP) of its international related party transactions under Section 92CA(4) of the Act? 3. Whether the Revenue erred in summarily rejecting the assessee's Transactional Net Margin Method (TNMM) analysis without demonstrating its inadequacy, and in determining the ALP for management support services at NIL by applying the 'Other Method' without demonstrating its applicability or bringing comparable uncontrolled transactions on record? Assessee's Contentions: - The AO violated mandatory provisions by not issuing the final assessment order in conformity with DRP directions and TPO order (Ground 1). - The Revenue erred in making an adjustment of Rs. 54,183,096 for management support services (Ground 2). - The Revenue wrongly rejected the TNMM analysis and applied the 'Other Method' to determine ALP at NIL without justification, disregarding the commercial expediency and need for services, and ignoring prior year's acceptance of similar transactions (Grounds 3 & 4). - The assessment order was cryptic and disregarded furnished information (Ground 5). - The AO erred in levying interest under Section 234B and making an error in computation of interest/fee (Grounds 6 & 7). - The AO erred in initiating penalty proceedings under Section 270A (Ground 8). - The assessment proceedings are barred by limitation (Ground 9 - withdrawn). Revenue's Contentions: - Not recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144C(13),Section 144B,Section 92CA(4),Section 92C(1),Section 10AB,Section 234B,Section 270A,Section 153

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “H”: NEW DELHI

Before: SHRI M. BALAGANESH

For Appellant: Shri Ajit Jain, CA
For Respondent: Shri S. K. Jadhav, CIT DR
Hearing: 16/04/2026Pronounced: 24/04/2026

PER M. BALAGANESH, A. M.:

1.

The Assessee Cambridge University Press and Assessment India Pvt. Ltd (hereinafter referred to as ‘assessee) by fil

The order continues below.

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