TaxTMI 
TaxTMI 
2016 (12) TMI 1402
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....e appellant is bad and erroneous in law and against the facts and circumstances of the case. 2. That the Hon'ble Dispute Resolution Panel erred in law and on facts in holding that it has no jurisdiction to entertain the objection u/s 144C of the Act against the draft assessment order passed in consequence of the directions given by the Hon 'ble Tribunal earlier. 3. That the Honble Transfer Pricing Officer (TPO) erred in law and on facts in passing the consequential order without giving an opportunity to the appellant while passing the consequential order u/s 92CA of the Act. 4. That the learned TPO erred in law and on facts in holding that the appellant has to establish that the payments made were commensurate to the volume and quality of service and cost and commensurate benefits were derived and such finding of the learned TPO is contrary to the clear directions of the Hon'ble Tribunal in ITA (TP) 1256/Bang/2011. 5. That the learned lower authorities erred in law and on facts in holding that the appellant should demonstrate that it has received the benefit form various services. should furnish a cost benefit analysis to justify the price paid for the international tra....
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....portunity of being heard to the assessee before passing consequential order u/s. 92CA as per the directions of DRP. 5. The ld. DR of revenue supported the orders of authorities below. 6. We have considered the rival submissions. First of all, we reproduce the provisions of section 144C from where the DRP gets the power and jurisdiction. These are as under:- "144C. (1) The Assessing Officer shall, notwithstanding anything to the contrary contained in this Act, in the first instance, forward a draft of the proposed order of assessment (hereafter in this section referred to as the draft order) to the eligible assessee if he proposes to make, on or after the 1st day of October, 2009, any variation in the income or loss returned which is prejudicial to the interest of such assessee. (2) On receipt of the draft order, the eligible assessee shall, within thirty days of the receipt by him of the draft order,- (a) file his acceptance of the variations to the Assessing Officer; or (b) file his objections, if any, to such variation with,- (i) the Dispute Resolution Panel; and (ii) the Assessing Officer. (3) The Assessing Officer shall complete the assessment on the basis of the d....
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....back to the file of TPO for fresh decision after providing reasonable opportunity of being heard to the assessee. We order accordingly. 9. In view of our above decision, the other grounds raised by the assessee do not call for any adjudication at this stage. 10. In the result, the appeal of assessee is allowed for statistical purposes. 11. Now we take up the remaining two appeals of assessee for the AYs 2010-11 and 2011-12. In both these years, grounds No.1 to 5 are identical and therefore, these grounds are reproduced below from assessee's appeal for AY 2011-12 i.e. IT(TP)A No.88/Bang/2016:- "1. That the order of the learned lower authorities in so far it is prejudicial to the interests of the appellant is bad and erroneous in law and against the facts and circumstances of the case. 2. That the learned lower authorities erred in law and on facts in holding that the appellant has not received the services from its Associated Enterprise and such a finding is perverse as being contrary to materials on record and not supported by any evidence on record. 3. That the learned lower authorities erred in law and on facts in holding that the appellant should demonstrate that it has re....
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....our attention to pages 61 to 67 of the paper book which consists of the e-mails between the assessee and the personnel of the AE and also reports of the personnel of AE who have visited India which are at pages 61-523. We find that the TPO has brushed aside these documents perfunctorily stating that there are only the emails and is not evidence of the services rendered. We are of the opinion that the TPO ought to have considered the documents in proper perspective to see whether the assessee has received any services. The documents purportedly are advices given by the AE to the assessee on various issues concerning its business. As held by the Hon'ble Delhi High Court in the case of CIT Vs E.K.L Appliances Ltd (In ITA Nos.1068/2011 & 1070/2011..whether or not to enter into a transaction is for the assessee to decide and the TPO can only examine and compute the quantum of ALP, but he has no authority to disallow the entire expenditure or a part thereof on the ground that the assessee has suffered continuous losses and therefore, not gained any commensurate benefit there from. Similar view was expressed by the Bench of the Tribunal at Mumbai in the case of Dresser Rand India (P) ....
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....ces. In view of the same, we deem it fit and proper to remand the issue to the file of the TPO for recomputing of the ALP without insisting upon the quantification of each of the services received by the assessee and the commensurate benefit that has accrued to the assessee. The entire payment made by the assessee towards 'management services' shall be taken as the aggregate payment for all the services rendered by the AE. The TPO is also directed to again reconsider the issue on the adoption of the most appropriate method and shall arrive at the ALP before making the adjustment after taking the appropriate comparables, as even for computation of ALP by adopting CUP method, identifying comparables is essential." 16. Respectfully following this Tribunal order, in the present two years also, we decide the issue on similar line and restore this matter back to TPO for a fresh decision with the same directions as was given by the Tribunal in AY 2007-08. Accordingly, these grounds are allowed for statistical purposes. 17. Thereafter, it was submitted by the ld. DR of revenue that grounds raised by the revenue in its appeal for AY 2010-11 and ground No.9 to 10 of the assessee's ....