M/S MERITOR H vs. INDIA PVT LTD,MYSORE

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ITA 295/BANG/2017Status: DisposedITAT Bangalore13 December 2019AY 2008-093 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal set aside the appeal and remanded the issue back to the TPO. The TPO is directed to re-examine the issue afresh, considering the assessee's submissions and following the prescribed procedure for determining the Arm's Length Price (ALP).

What were the facts?

The assessee paid development fees/technical fees to its Associated Enterprise (AE). The Transfer Pricing Officer (TPO) made an addition based on perceived wrong findings, and the Dispute Resolution Panel (DRP) followed a predecessor order which had been set aside by the Tribunal.

What were the issues?

Whether the TPO correctly determined the Arm's Length Price (ALP) for intragroup services and development fees, and whether the DRP erred by following a previous order that was later set aside.

Which sections of the Income-tax Act were involved?

Section 92CA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCHES : “B”, BANGALORE

Before: SHRI B.R.BASKARAN & SMT. BEENA PILLAI, JUDICAL MEMBER

For Appellant: Smt. Vidya Kurup, Advocate
For Respondent: Ms. Neera Malhotra, CIT-DR

PER SMT BEENA PILLAI, JUDICIAL MEMBER: Present appeal has been filed by assessee against final assessment order dated 10/12/14 passed by Ld. ACIT, Circle 1 (1), Mysore for assessment year 2008-09.

1.

(B)/2017 2 2. At the outset Ld.AR submitted that only dispute raised by Ld.TPO is in respect of payment of development fees (technical fees)/intragroup services. It has been submitted that though assessee filed all relevant details showing rendering of services and the need of such technical assistance from its AE against which the payments have been made Ld. TPO observed and recorded wrong finding in para 2 of his order in the garb of which, addition has been made without following due process of law.

3.

Ld.AR further submitted that DRP while considering the issue followed their own predecessor order for assessment year 2007-08 wherein, ALP for services rendered were found to be at ‘nil’ thereby upholding adjustment proposed by Ld.TPO. Ld.AR submitted that this Tribunal in assessee’s own case for assessment year 2007-08, remanded the issue back to Ld.TPO with direction to examine the issue afresh by considering details/evidences submitted by assessee and other submissions, which were already on record. He thus submitted that issue may be set-aside to Ld. TPO for reconsidering the issue afresh on the basis of detailed submissions filed by assessee which is already placed on record.

4.

Ld. CIT DR did not object for issue being set aside to Ld.TPO as ALP has not been computed by following the procedure laid down in law.

5.

We have perused submissions advanced by both sides in light of records placed before us.

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