2019 (7) TMI 312

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....: Mr. Rhishabh Jetley and Mr. Shubham Jain, Advocates. O R D E R CM APPL. 29035/2018 (Exemption) 1. Exemption allowed subject to all just exceptions. CM APPL. 29036/2018 (Delay in filing) and CM APPL. 29037/2018 (Delay in filing) 2. For the reasons explained in the applications, the delay in filing and refiling the appeal is condoned and the applications are allowed. ITA 760/2018....

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....oncerned with AY 2007-2008. In the years earlier to said AY, the Assessee had paid royalty at 2% of the earnings in foreign currency for each of the aforementioned items to its AE. In its Transfer Pricing Analysis, the Assessee chose the CUP as the most appropriate method for determining the ALP. According to Assessee, payments of royalty up to 8% of exports and 5% of domestic sales under the 'Aut....

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.... higher payment of royalty was not justified and a mere facade had been raised to give an impression that some benefit had passed to the Assessee, when in fact that was not the case. 8. After the Dispute Resolution Panel (DRP) partially agreed with the TPO, the Assessee went in appeal before the ITAT. The ITAT noted that for the subsequent AY 2008-09, the DRP followed a survey report prepared b....

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....he Revenue, does not make any reference to the prevalent practice in the travel industry which would give an indication as to the trend in the royalty payment. That could give reasonable indication whether the payment of royalty by the Assessee to its AE for the AY in question was unreasonable. In the absence of such empirical data, to merely conclude that the payment of higher royalty was not jus....