AGILENT TECHNOLOGIES INDIA PVT. LTD. vs. DCIT CIRCLE 1 (1)

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ITA/587/2016HC DelhiDLHC01166688201602 November 2016Bench: HON'BLE MR. JUSTICE S. RAVINDRA BHAT,HON'BLE MS. JUSTICE DEEPA SHARMA2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court directed the Transfer Pricing Officer (TPO) to consider on merits the question of whether segregation or de-segregation of transactions is the most appropriate approach. This consideration is to be made in light of the totality of the facts and circumstances. The Court emphasized that the TPO should keep in mind the view of the High Court as expressed in its various decisions, including the case of Sony Ericsson Mobile Communications India Private Limited vs. CIT (2015) 374 ITR 118. The Court did not decide the issue of segregation itself but remanded it for a fresh determination by the TPO, thereby implicitly accepting the assessee's grievance that the ITAT should not have pre-empted this decision.

What were the facts?

The appeals were filed by Agilent Technologies India Pvt. Ltd. (the assessee) against the order of the Income Tax Appellate Tribunal (ITAT). The core of the dispute revolved around the ITAT's direction for a remand of certain issues. The assessee contended that the ITAT, while remanding the matter, should not have expressed a distinct opinion on the necessity of segregating transactions. This segregation was relevant to the transfer pricing exercise undertaken by the Transfer Pricing Officer (TPO). The assessee argued that the issue of segregation had not been explicitly raised by the parties in their appeal before the ITAT.

What were the issues?

1. Whether the Income Tax Appellate Tribunal (ITAT), while directing a remand of certain issues, should have expressed its opinion on the necessity of segregating transactions for the purpose of a transfer pricing exercise. (Question of law) Assessee's Contentions: The assessee argued that the ITAT should not have expressed a distinct opinion on the segregation of transactions, as this issue was not expressly urged in the appeal before the Tribunal. The assessee relied on the High Court's previous decisions, including Sony Ericsson Mobile Communications India Private Limited vs. CIT (2015) 374 ITR 118. Revenue's Contentions: The judgment does not record any specific contentions made by the revenue on this issue.

AI-generated summary — verify with the full judgment below

$~13 & 14 * IN THE HIGH COURT OF DELHI AT NEW DELHI

ITA 570/2016

AGILENT TECHNOLOGIES INDIA PVT. LTD. ..... Appellant Through: Mr.Kamal Sawhney and Mr.Shikhar Garg, Advs.

versus

DCIT CRICLE 1 (1)

..... Respondent Through: Mr.Rahul Kaushik, Senior Standing counsel for Income Tax.

+ ITA 587/2016

AGILENT TECHNOLOGIES INDIA PVT. LTD. ..... Appellant Through: Mr.Kamal Sawhney and Mr.Shikhar Garg, Advs.

versus

DCIT CRICLE 1 (1)

..... Respondent Through: Mr.Rahul Kaushik, Senior Standing counsel for Income Tax.

CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MS. JUSTICE DEEPA SHARMA

O R D E R %

02.11.2016

3.

The question of law urged by the assessee is that the Income Tax Appellate Tribunal (hereinafter referred to as the “ITAT”) even while directing a remand of certain issue should not have expressed its opinion distinctively on the issue whether segregation of transaction

had to be carried out, while in the ail to determine vis-a-vis the transfer pricing exercise carried out by the TPO. 2. The record disclosed that the question of segregation had not been expressly urged in the appeal by the parties. Having regard to the record, we hereby directs the TPO to consider on the merits as to whether segregation or desegregation is the most appropriate, having regard to the totality of the facts and circumstances keeping in mind the view of this court in its various decisions including Sony Ericsson Mobile Communications India Private Limited vs. CIT (2015) 374 ITR 118. 4. The appeal is disposed of in above terms.

S. RAVINDRA BHAT, J

DEEPA SHARMA, J NOVEMBER 02, 2016 mr

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