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Income Tax Appellate Tribunal, “J” BENCH, MUMBAI
The Income Tax Room No. 02, Aayakar Bhava, …………….Respondent 2nd Floor, M.K. Road, / प्रत्यथााी Mumbai-400 020 अपीलाथाी की ओर से / Appellant by : Shri Nishant Thakkar, AR प्रत्यथाी की ओर से / Respondent by : Shri Pavan Kumar Beerla, DR स नवाई की तारीख / Date of hearing: 11.09.2019 घोर्णा की तारीख / Date of pronouncement : 11.09.2019 A a d o S a / O R D E R महावीर स िंह, न्याययक दस्य/ PER MAHAVIR SINGH, JM: This appeal is arising out of the order of Commissioner of Income Tax (Appeals)-15, Mumbai in Appeal Nos. CIT(A)-15/Arr.
2 | P a g e 206/14-15 dated 14.10.2014. The Assessment was framed by the Income Tax Officer 8(3)-3, Mumbai (in short ITO/ AO) for AY 2009-10 vide dated 18.04.2013 under section 143(3) of the Income-tax Act, 1961 (hereinafter ‘the Act’).
The first issue in this appeal of assessee is against the order of CIT(A) confirming the action of the AO/ Transfer Pricing Officer in making adjustment on account of Mark up of 5% on the regional management fee amounting to Rs. 8,81,286/-. At the outset, the learned Counsel for the assessee stated that he has instructions from the assessee not to press this issue due to smallness of the amount. The learned Sr. Departmental Representative has not objected for the same. Hence, this issue is dismissed as not pressed.
The second issue in this appeal of the assessee is against the order of CIT(A) confirming the action of the AO / Transfer Pricing Officer in making addition of ₹ 79,97,024/- on account of transfer pricing adjustment to IT services fees payable to its associated enterprises. For this assessee has raised the following ground No. 3: - “3.0: Re: Addition on account disallowance of entire reimbursement pertaining to availing IT support services amounting to ₹ 79,97,024/- from AE.
3 | P a g e 3.1 The learned AO/ Transfer Pricing Officer erred in law and facts by making addition of ₹ 79,97,024/- on account of transfer pricing adjustment to IT services fees payable to its associated enterprise. 3.2 The appellant submits that that considering the facts and circumstances of its case, all the supporting documents were placed on record before the Hon’ble CIT(A) which are overlooked and the addition so sustained is not warranted. 3.3 The appellant submits that the AO be directed to delete the addition so made by him and to re-compute its total income accordingly.”
At the outset, the learned Counsel for the assessee took us through the order of CIT(A) at Para 5.3 clause i and the relevant para, he pointed out, reads as under: - “……. In fact, in the letter dated 21.12.12, the Transfer Pricing Officer has given an opportunity to produce copies of subcontracting agreements with the AEs and also the copies of invoices based thereon, furnish copies of agreements for 4 | P a g e payment of such license fee and justify the same to the Ae, to furnish a detailed note regarding nature of reimbursements and proof of incurring such expenses and copy of agreements with the AEs etc. Further, the Transfer Pricing Officer has clearly mentioned that the assessee had not produced any back=to=back invoices to prove that these expenses are passed on to the assessee on cost to cost basis and hence, now it cannot take the plea that all the details were produced. In fact, in the submissions made before Transfer Pricing Officer it has agreed that back to back invoices could not be produced and this fact has not been denied even during the course of appellate proceedings. Accordingly, all these evidences which are being produced during the appellate proceedings now amount to furnish of additional evidence. However, no application requesting to admit this additional evidence has been filed highlighting reasonable cause under Rule 46A, for want of which the additional evidence filed by it cannot be admitted.