DCIT, BANGALORE vs. M/S ANZ OPERATIONS & TECHNOLOGY PVT. LTD., BANGALORE

It was submitted by ld. AR of assessee that for similar issue, the cross appeals of assessee and revenue for Assessment Year 2009-10 in IT(TP)A Nos. 328 & 342/Bang/2014 was heard by the Tribunal on 08.04.2019 and it was heard by the bench consisting of the present AM and one other Judicial Member. It was submitted that regarding TP grounds in that year also, it was argued that there is MAP resolution which is accepted by the assessee for transactions with Australian entities and therefore, the grounds to that extent were withdrawn and it was submitted that for the transactions of the assessee with other AE entities which are non-Australian entities, the same rate as per MAP resolution with Australian entities should be adopted. He submitted that in the present two years also, the facts are similar because in Assessment Year 2007-08, the percentage of total transactions covered under MAP with Australian entities is 98.67% and similarly, the percentage of total transactions covered under MAP with Australian entities in Assessment Year 2008-09 is 98.74%. It is submitted that in Assessment Year 2009-10, the appeal of which is already heard by the Tribunal, the percentage of such transactions with Australian entities was 99.65%. It was submitted that in the present two years also, the TP issue should be decided in the same line i.e. the grounds to the extent of transactions with Australian entities should be rejected and for non-Australian entities, it should be held that the same percentage should be applied by the TPO for non-Australian entities. He submitted that the tribunal order for A. Y. 2009 – 10 will submitted by him after its pronouncement or the bench may obtain a copy thereof and decide the present appeals on similar line. It was submitted that in the appeal of the revenue for Assessment Year 2007-08, apart from TP grounds, there is one ground in respect of corporate tax in respect of computation of deduction allowable u/s. 10A of IT Act. It was agreed by both sides that this issue is now covered in favour of the assessee by the judgment of Hon’ble Karnataka High Court rendered in the IT(TP)A Nos.432 & 403/Bang/2012, 483/Bang/2013 & C.O. No. 130/Bang/2015 Page 3 of 6 case of CIT Vs. Tata Elxsi Ltd. as reported in 349 ITR 98 and the judgment of Hon’ble Apex Court rendered in the case of CIT vs. HCL Technologies Ltd. as reported in 302 CTR 191 and there is no other ground.

Regarding Assessment Year 2008-09, it was submitted that in this appeal of the revenue also, there is one more ground regarding corporate tax issue as per ground no. 2 in respect of computation of deduction allowable u/s. 10A of IT Act which is similar to the ground raised

We have considered the rival submissions. We find that the appeal of the assessee and revenue for Assessment Year 2009-10 in IT (TP) A Nos. 328 & 342/Bang/2014 had been decided by the tribunal by pronouncing the order on 25.04.2019. Para nos. 6 to 9 of this Tribunal order are relevant and hence, the same are reproduced hereinbelow for ready reference. “6. We have considered the rival submissions. First of all, we decide the TP issue which is raised by the assessee in its appeal. We find that out of TP adjustment made by the AO, the major adjustment of 99.65% for software development segment and 98.52% in for ITES segment is in respect of transactions with Australian entities and the assessee has already accepted the MAP resolution in respect of Australian entities and withdrawn the grounds of its appeal in respect of TP adjustment in respect of Australian entities. Hence to that extent, the grounds of the assessee’s appeal are rejected as not pressed / withdrawn. In respect of TP adjustment, on account of transaction with non-Australian entities, it was submitted by ld. AR of assessee before us that the same should be quantified on the basis of MAP resolution in respect of transactions with Australian entities. The Tribunal order rendered in the case of Textron India Pvt. Ltd. Vs.

Regarding the corporate tax issue raised by the revenue in both years in respect of computation of deduction allowable u/s. 10A of IT Act, we decline to interfere in the order of CIT(A) on this issue in both the years by respectfully following the judgment of Hon’ble Karnataka High Court rendered in the case of CIT Vs. Tata Elxsi Ltd. (supra) and the judgment of Hon’ble Apex Court rendered in the case of CIT vs. HCL Technologies Ltd. (supra).

In the result, both the appeals of the revenue are dismissed whereas the appeal of the assessee for Assessment Year 2007-08 and C.O. of the assessee for Assessment Year 2008-09 are partly allowed in the terms indicated above. Order pronounced in the open court on the date mentioned on the caption page.