DCIT, GHAZIABAD vs. M/S PROGRESSIVE TOOLS & COMPONENTS PVT. LTD., GHAZIABAD

This appeal filed by the Revenue is directed against the order dated 23rd February, 2016 of the CIT(A), Muzafarnagar relating to assessment year 2006-07. The grounds of appeal

Facts of the case, in brief, are that the assessee is a company engaged in the business of manufacturing of auto parts and components. It filed its return of income on 29.11.2006 declaring the total income at Rs.21,03,761/-. The case was reopened by issue of statutory notice. Subsequently, the Assessing Officer completed the assessment u/s 143(3)/148 at a total income of Rs.1,97,80,545/-. In appeal, the ld.CIT(A), following his order for assessment years 2005-06 and 2007-08, deleted the various additions which are the subject matter of appeal by the Revenue.

The ld. counsel for the assessee, at the outset, filed a copy of the order of the Tribunal in assessee’s own case for assessment year 2005-06 and submitted that under identical circumstances the Tribunal has restored the issue to the file of the A.O./TPO for fresh determination of the ALP of the international transaction. Since the ld.CIT(A), while deciding the issue has followed his order for assessment year 2005- 06, therefore, he has no objection if the matter is restored to the file of the Assessing Officer/TPO with similar directions. The ld. DR has no objection to restoring the issue to the file of the Assessing Officer/TPO in line with the order of the Tribunal for assessment year 2005-06 in assessee’s own case. Since, in the instant case, the ld.CIT(A) while deleting the addition of Rs.1,44,89,897/- on account of royalty determined by the A.O./TPO in respect of international transaction has followed his order for assessment year 2005-06 and since the Tribunal in assessee’s own case for assessment year 2005-06 in order dated 10th March, 2017, has restored the issue to the file of A.O./TPO for fresh determination of the ALP of the international transaction, therefore, we deem it proper to restore the issue to the file of the A.O./TPO for determination of the ALP of the international transaction for the impugned assessment year in the light of the directions of the Tribunal for assessment year 2005-06. The A.O./TPO shall decide the issue as per fact and law, after giving the assessee due opportunity of being heard. The grounds raised by the Revenue are accordingly allowed for statistical purposes.