EATON TECHNOLOGIES PVT.LTD,,PUNE vs. DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE - 1(2),, PUNE

Appeal is partly allowed in above terms

Bench: Shri S. S. Godara, Jm & Shri Dr. Dipak P. Ripote, Am आयकर अपीऱ सं. / Ita No.3075/Pun/2017 ननधधारण वषा / Assessment Year : 2013-14 Eaton Technologies Pvt. Ltd. Cluster C, Wing 1, Eon Free Zone, Plot No.1, Sr. No.77, Midc Kharadi Knowledge Park, Kharadi ,Pune- 411 014. .......अपऩलधथी / Appellant Pan : Aabce4323Q बनधम / V/S. ……प्रत्यथी / Respondent Dcit, Circle-1(2), Pune Assessee By : Shri Vishal Karla Revenue By : Shri S. P. Walimbe

2)(iii) of the Rules. 13. Notwithstanding and without prejudice to the above and on facts and circumstances of the case and in law, the AO has erred in not accepting the claim of the Appellant that only expenditure amounting to INR 78,301 can be said to have been incurred for earning the dividend income in the absence

DEPUTY COMMISSIONER OF INCOME TAX CIR 1(1), PUNE vs. EATON TECHNOLOGIES PVT. LTD.,, PUNE

Appeals are partly allowed for statistical purpose in above terms

Bench: Shri S.S.Godara & Dr. Dipak P. Ripoteआयकरअपीलसं. / Ita Nos.42 & 43/Pun/2021 िनधा"रणवष" / Assessment Years : 2015-16 & 16-17 Dcit, Circle-1(1), Pune. M/S.Eaton Technologies Pvt. Ltd., Vs Cluster C Wing-1, Eon Zone, Midc Kharadi, Knowledge Park, Plot No.1, Survey No.77, Kharadi, Pune – 411014. Pan: Aabce 4323 Q Appellant/ Assessee Respondent /Revenue Assessee By Shri Vishal Kalra & Shri Ss Tomar -Ar Revenue By Shri Sunil Kumar – Cit(Dr) Date Of Hearing 24/06/2022 Date Of Pronouncement 07/07/2022 आदेश/ Order Per S.S.Godara, Jm: These Revenue’S Twin Appeals For The Assessment Years 2015- 16 & 2016-17 Arise Against The Cit(A)-13, Pune’S Separate Orders; Both Dated 29.05.2020, Passed In Case No.Pn/Cit(A)-13/Dcit, Circle-1(2), Pune/10142/2019-20/02, Pn/Cit(A)-13/Dcit, Circle- 1(2), Pune/10142/2019-20/03 Respectively, Involving Proceedings Under Section 143(3) Of The Income Tax Act, 1961. Heard Both The Parties. Case Files Perused.

2 and Explanation 4 of Section 9(1)(vi) of the Act and decisions of Hon’ble Karnataka High Court’s in the case of Synopsis International Old Ltd. ITA Nos.42 & 43/PUN/2021 for A.Y’s: 2015-16 & 16-17 DCIT Vs. M/s.Eaton Technologies Pvt. Ltd., (R) (2012) 28 Taxmann.com 162 and Samsung Electronics Company Ltd. (2011) 16 Taxmann.com

DEPUTY COMMISSIONER OF INCOME TAX CIR 1(1), PUNE vs. EATON TECHNOLOGIES PVT. LTD.,, PUNE

Appeals are partly allowed for statistical purpose in above terms

Bench: Shri S.S.Godara & Dr. Dipak P. Ripoteआयकरअपीलसं. / Ita Nos.42 & 43/Pun/2021 िनधा"रणवष" / Assessment Years : 2015-16 & 16-17 Dcit, Circle-1(1), Pune. M/S.Eaton Technologies Pvt. Ltd., Vs Cluster C Wing-1, Eon Zone, Midc Kharadi, Knowledge Park, Plot No.1, Survey No.77, Kharadi, Pune – 411014. Pan: Aabce 4323 Q Appellant/ Assessee Respondent /Revenue Assessee By Shri Vishal Kalra & Shri Ss Tomar -Ar Revenue By Shri Sunil Kumar – Cit(Dr) Date Of Hearing 24/06/2022 Date Of Pronouncement 07/07/2022 आदेश/ Order Per S.S.Godara, Jm: These Revenue’S Twin Appeals For The Assessment Years 2015- 16 & 2016-17 Arise Against The Cit(A)-13, Pune’S Separate Orders; Both Dated 29.05.2020, Passed In Case No.Pn/Cit(A)-13/Dcit, Circle-1(2), Pune/10142/2019-20/02, Pn/Cit(A)-13/Dcit, Circle- 1(2), Pune/10142/2019-20/03 Respectively, Involving Proceedings Under Section 143(3) Of The Income Tax Act, 1961. Heard Both The Parties. Case Files Perused.

2 and Explanation 4 of Section 9(1)(vi) of the Act and decisions of Hon’ble Karnataka High Court’s in the case of Synopsis International Old Ltd. ITA Nos.42 & 43/PUN/2021 for A.Y’s: 2015-16 & 16-17 DCIT Vs. M/s.Eaton Technologies Pvt. Ltd., (R) (2012) 28 Taxmann.com 162 and Samsung Electronics Company Ltd. (2011) 16 Taxmann.com

CREDAI - PUNE METRO,PUNE vs. DEPUTY COMMISSIONER OF INCOME-TAX, EXEMPTION CIRCLE, PUNE

price and it cannot be said to be on the basis of no profit or loss and the only motive behind such activity is to maximize the profits. This observation also being upheld by the Ld. CIT(Appeal) is factually incorrect since the Revenue has not brought on record any evidence through enquiry or verification that the assessee used

INCOME TAX OFFICERV(EXEMPTION) WARD 2, PUNE vs. CREDIA PUNE METRO , PUNE

price and it cannot be said to be on the basis of no profit or loss and the only motive behind such activity is to maximize the profits. This observation also being upheld by the Ld. CIT(Appeal) is factually incorrect since the Revenue has not brought on record any evidence through enquiry or verification that the assessee used

INCOME TAX OFFICERV(EXEMPTION) WARD 2, PUNE vs. CREDIA METRO PUNE, PUNE

price and it cannot be said to be on the basis of no profit or loss and the only motive behind such activity is to maximize the profits. This observation also being upheld by the Ld. CIT(Appeal) is factually incorrect since the Revenue has not brought on record any evidence through enquiry or verification that the assessee used

CREDAI-PUNE METRO,PUNE vs. INCOME-TAX OFFICER, EXEMPTION, PUNE

price and it cannot be said to be on the basis of no profit or loss and the only motive behind such activity is to maximize the profits. This observation also being upheld by the Ld. CIT(Appeal) is factually incorrect since the Revenue has not brought on record any evidence through enquiry or verification that the assessee used

DEPUTY COMMISSIONER OF INCOME TAX, PUNE vs. HALLIBURTON TECHNOLOGY INDIA PVT. LTD, PUNE

In the result, the appeal of the Revenue is dismissed

Bench: Invoking Section 80La( 10) , Of The Act When Bare Reading Of The Provision Does Not Impose Such Burden Of Proving Tax Avoidance On A.O.? 3. Whether On The Facts, Circumstances Of The Case And- In Law, Ld. Commissioner Of Income Tax (Appeals) Was Justified In Interpreting The Words According To The Object Of The Provision Ignoring The Fundamental Principle Of Interpretation Of Stature That Nothing Should Be Added To The Words Used By Legislature? 4. Whether On The Facts & Circumstances Of The Case & In Law, The Ld. Cit(A) Was Justified In Imposing Burden Of Proving Tax Avoidance Ignoring The Fact That Section 80Ia(10) Of The Act Is A “Domestic Transfer Pricing” Provision & Proving Tax Avoidance Is Not One

Transfer Pricing assessment can at best be taken as an indicator for the Assessing Officer to investigate as to whether or not there exists any arrangement which has resulted in more than ordinary profits qua the requirements of section 10A(7) r.w.s. 80-IA(10) of the Act. Even if it is accepted that the difference between the operating margins

MERCEDES-BENZ INDIA PRIVATE LIMITED,,PUNE vs. DEPUTY COMMISSIONER OF INCOME TAX,, PUNE

The appeal of the assessee is partly allowed for statistical purposes

15 - Transfer pricing adjustment without giving benefit of +/-5 percent as available under proviso to section 92C(2) of the Act Erred

FAURECIA INTERIOR SYSTEMS INDIA P. LTD.,,PUNE vs. ASSISTANT COMMISSIONER OF INCOME-TAX,,

In the result, appeal of the assessee is partly allowed for statistical

Bench: Ms. Sushma Chowla, Jm & Shri D. Karunakara Rao, Am

2) of the Act of adopting as arm's length price, a price which varies by not more than 5 per cent from the arm's length price. 13. Erroneous levy of interest under section 234B of the Act Without prejudice to the above grounds, even if the adjustments are sustained, the learned AO erred in levying interest under section

ASSISTANT COMMISSIONER OF INCOME-TAX vs. PERSISTENT SYSTEMS PVT. LTD.,, PUNE

In the result, the appeal of Revenue is dismissed

Bench: Ms. Sushma Chowla, Jm & Shri Anil Chaturvedi, Am आयकर अपीऱ सं. / Ita No.2336/Pun/2016 यििाारण वषा / Assessment Year : 2011-12 The Asst. Commissioner Of Income Tax, अऩीऱाथी/Appellant Circle – 4, Pune …. Vs. Persistent Systems Pvt. Ltd., Bhageerath, 402, Senapati Bapat Marg, …. प्रत्यथी / Respondent Pune – 411016 Pan: Aabcp1209Q

2), as increased by the amount or amounts of expenditure relatable to any income to which section 10 (other than the provisions contained in clause 38 thereof) of section 11 or section 12 apply" and in this case the disallowance is made u/s 14A which is always part of the expenses specifically debited to the profit and loss account

M/S. A B KNOWLEDGE SYSTEMS,,PUNE vs. INCOME-TAX OFFICER,,

In the result, the appeal of assessee is partly allowed

Bench: Ms. Sushma Chowla, Jm & Shri D. Karunakara Rao, Am आयकर अपीऱ सं. / Ita No.894/Pun/2016 यििाारण वषा / Assessment Year : 2012-13 M/S. Ab Knowledge Systems, 406, Lunkad Sky Station, Viman Nagar, अऩीऱाथी/Appellant Pune – 411014 …. Pan: Aarfa5025E Vs. The Income Tax Officer, …. प्रत्यथी / Respondent Ward 7(3), Pune

2 Without prejudice to 1 above, assuming that provisions of section 80-IA(8) r.w.s. 10AA(9) do apply, on the facts and in the circumstances of the case, the Ld. CIT(A) ought to have held that deduction allowable u/s 10AA was to be computed as contemplated in the manner specified in section

M/S. HONEWELL AUTOMATION INDIA LTD.,,PUNE vs. DEPUTY COMMISSIONER OF INCOME-TAX,,

In the result, the appeal of Revenue is dismissed

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Ravi

transfer pricing principles, and provides a more reliable comparable analysis as compared to comparison with external comparables. We note that the Assessing Officer/TPO did not accept the contentions of assessee, made 14 ITA Nos. 583 & 619/PUN/2015, A.Y. 2003-04 upward adjustment of Rs.2,44,04,000/- by taking margin at 7.26% of operating profit of Rs.8,26,04,000/-. 15

DEPUTY COMMISSIONER OF INCOME-TAX vs. M/S. HONEYWELL AUTOMATION INDIA LTD.,, PUNE

In the result, the appeal of Revenue is dismissed

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Ravi

transfer pricing principles, and provides a more reliable comparable analysis as compared to comparison with external comparables. We note that the Assessing Officer/TPO did not accept the contentions of assessee, made 14 ITA Nos. 583 & 619/PUN/2015, A.Y. 2003-04 upward adjustment of Rs.2,44,04,000/- by taking margin at 7.26% of operating profit of Rs.8,26,04,000/-. 15

DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE - 1(1),, PUNE vs. M/S. IAC INTERNATIONAL AUTOMOTIVE INDIA PVT.LTD,, PUNE

In the result, the appeal of the Revenue is dismissed

Bench: Ms. Astha Chandra & Shree Dr. Dipak P. Ripote

2. The TPO's approach is fundamentally flawed, as the mere reference to the "Other Method"-without adherence to the procedure laid down under Rule 13 ITA No.749/PUN/2022, AY 2013-14 10AB-cannot justify a deviation from statutorily prescribed transfer pricing principles. As per Rule 10AB, any method applied must be based on "price charged or paid, or cost incurred

M/S. HONEWELL AUTOMATION INDIA LTD.,,PUNE vs. DEPUTY COMMISSIONER OF INCOME-TAX,,

In the result, the appeal of Revenue is dismissed as infructuous

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Ravi

2) of the Act. The case of CIT(A) is that the deduction u/s. 10A is to be restricted to the extent of ordinary profit earned by the assessee be that of comparable companies by invoking the provisions of sub-section (7) of section 10A of the Act. 7. The assessee submitted that the provisions of section

DEPUTY COMMISSIONER OF INCOME-TAX vs. M/S. HONEYWELL AUTOMATION INDIA LTD.,, PUNE

In the result, the appeal of Revenue is dismissed as infructuous

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Ravi

2) of the Act. The case of CIT(A) is that the deduction u/s. 10A is to be restricted to the extent of ordinary profit earned by the assessee be that of comparable companies by invoking the provisions of sub-section (7) of section 10A of the Act. 7. The assessee submitted that the provisions of section

MERCEDES-BENZ INDIA PVT. LTD. (FORMERLY KNOWN AS DAIMLER CHRYSLER INDIA PVT. LTD),PUNE vs. ASST. CIT, CIRCLE-8, PUNE

In the result, appeal of assessee is partly allowed, appeal of Revenue is dismissed and cross objections of assessee are dismissed

Bench: Ms. Sushma Chowla, Jm & Shri D. Karunakara Rao, Am आयकर अपीऱ सं. / Ita No.1083/Pun/2013 यििाारण वषा / Assessment Year : 2005-06 Mercedes-Benz India Pvt. Ltd., (Formerly Known As Daimler Chrysler India Pvt. Ltd.) E-3, Midc Chakan, Phase – Iii, Chakan Industrial Area, Kuruli & Nighoje, Tal. Khed, अऩीऱाथी/Appellant Pune – 410501 …. Pan: Aabcm1789L Vs. The Asst. Commissioner Of Income Tax, …. प्रत्यथी / Respondent Circle – 8, Pune

transfer pricing regulations and warranted adjustment. In the trading of spares, the assessee had generated gross margin of 25.42% and total sales of CBUs were ₹ 18,17,48,020/-. The TPO thus, proposed an upward adjustment of ₹ 2,56,10,076/- to arm's length price of international transaction towards import of CBUs. 14. The next aspect was payment