DCIT, CIRCLE-14(2), NEW DELHI vs. KOHLER INDIA CORPORATION PVT. LTD., NEW DELHI

PDF · subscribers
ITA 7811/DEL/2019Status: DisposedITAT Delhi09 February 2022AY 2008-094 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that including the disputed comparables would result in an ALP adjustment within the tolerance margin of TP guidelines. Therefore, the Revenue's appeal was dismissed.

What were the facts?

The Revenue appealed against an order concerning the inclusion of comparables for Arm's Length Price (ALP) adjustments. The assessee argued that even with the disputed comparables, the ALP would remain within the tolerance margin of TP guidelines.

What were the issues?

Whether the inclusion of certain comparables for ALP adjustment would fall within the tolerance margin of TP guidelines, and if not, whether the Revenue's appeal should be dismissed on grounds of low tax effect.

Which sections of the Income-tax Act were involved?

Section 92CA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘I-1’ NEW DELHI

Before: SHRI B. R. R. KUMAR & SH. YOGESH KUMAR US

Hearing: 03.02.2022Pronounced: 09.02.2022

Heard together (2 matters)

C.O No. 06/Del/2020
I.T.A. No. 7811/DEL/2019

Read from the judgment's own cause title. This page is filed under one of them.

ORDER PER YOGESH KUMAR US, JM This appeal is filed by the Revenue and Cross Objection filed by the assessee against the order dated 23/07/2019 passed by CIT(A)- 44, New Delhi for Assessment Year 2008-09.

2.

The Department aggrieved by the order impugned has raised two separate grounds for not including the comparables by the A.O. i.e. M/s Jain Granites & Project India Ltd. and M/s Somany

3.

The representative of the Assessee submitted that, even if both the grounds raised by the Revenue are allowed by including the comparables i.e. M/s. Jain Granites & Projects India Ltd and M/s.

Somany Ceramics Ltd. for determining the adjustments made of Arm’s Length Price under Section 92CA of the Act, would be well within the tolerance margin of the T.P guidelines, therefore, the appeal of the Revenue deserves to be dismissed. Further submitted that consequent to the dismissal of the Revenue Appeal. The CO filed by the Assessee will also become in-fructuous.

4.

We have heard the submissions of Ld. AR and also the Ld. DR and also perused the records.

5.

We find that, by including the above two comparables raised in the grounds of Appeal, the Arm Length Price charges would change to 37.5% to 41%, which is still within the tolerance margin of + 5% of the TP guidelines.

6. We, by taking note of the concerns expressed by the ld.CIT, DR and make it clear that as a result of the dismissal of the Revenue’s appeal on the ground of low tax effect, the said order would not act as a precedent where there is a tax effect in any subsequent or prior year where the Revenue would want to agitate the issues on similar grounds before the ITAT on merit. Accordingly, in the light of the submissions of the ld. AR and the DR, the appeal of the Revenue is dismissed.

7.

Now we turn to the C.O. No. 06/Del/2020 filed by the assessee.

In view of the dismissal of the Appeal filed by the revenue of the due to no tax effect revenue, the C.O. filed by the Assessee has become in- fructuous, consequently the C.O. filed by the Assessee is also dismissed.

8.

In the result, t h e CO filed by the Assessee is stand dismissed.

9.

In the result both the appeal filed by the Revenue and the assessee are dismissed.

More judgments on Section 92CA

All 3,978 judgments and leading authorities on Section 92CA →

Recent GST High Court judgments

Search GST case law →