2021 (2) TMI 1085

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....ring the fact that the profit from Non AE Segment is only 1.60%. iv. The Ld. DRP ought to have seen that the commission received from the other liners is only Rs. 1,06,64,128/as against the turnover handled Rs. 66,44,10,448/- which comes rate of about 1.60% and not 11.36%. v. The Ld. DRP erred in including the gross miscellaneous income of Rs. 6,48,39,254/- as a part of the commission from other liners and erred in arriving at the total income from the other liners at Rs. 7,55,03,382/-. vi. The Ld. DRP ought to have considered that the miscellaneous income of Rs. 6,48,39,254/- was derived for the allied services and not for the liners handled by the appellant. The said receipt cannot form part of the commission from the other liners. vii. As alternate the Ld. DRP ought not to have considered the gross amount of Rs. 6,48,39,254/- as a part of Income relating to other liners without considering that appellant incurred expenditure of Rs. 4,06,37,577 on deriving the miscellaneous income. viii. The Ld. DRP erred in directing the A.O. to work out the margin of profit at 11.36% of the gross receipts and the A.O. erred in determining the adjustment at Rs. 5,77,88,600. ix. The L....

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....n to include the same in this entire process therefore. We deem it appropriate to restore the instant first issue back to the Transfer Pricing Officer 'TPO' for his appropriate adjudication as per law with a specific direction that in case if it is found after verification of the relevant records coming from assessee's level that the impugned income is not relevant for determination of ALP pertaining to international transactions with the AE(s) it would not be considered in the said consequential computation exercise. Learned counsel has also placed on record the TPO's order for very next A.Y. 2015-16 stating he had himself excluded identical misc. income for the purpose of determining the ALP adjustment regarding its international transactions. Needless to say, the AO shall also take note of all these subsequent developments on this issue. Assessee's instant vth substantive ground (supra) is restored back to the TPO in aforementioned terms. 4. Next comes the issue of interest on receivables of Rs. 6,77,226/- qua amounts due from overseas associate enterprises of Rs. 1,93,29,066/-. We notice from a perusal of para 7.8 of TPO's order dated 27th March, 2007 ....

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....ive action; after repealing corresponding provision, is that the same never existed in the Act. Relevant observations to this effect read as follows: "4. Having carefully examined the orders of lower authorities, we find that impugned issue is squarely covered by the order of the Tribunal in the assessee's own case for the assessment year 2013-14. The relevant observation of the Tribunal is extracted hereunder for the sake of reference: "7. Having carefully examined the orders of authorities below in the light of rival submissions and relevant provisions and various judicial pronouncements, we find that by virtue of the insertion of section 92BA on the statute as per clause (i), any expenditure in respect of which payment has been made or is to be made to person referred to in clause (b) of sub-section 2 of section 40A exceeds the prescribed limit, it would be a specified domestic transaction for which AO is required to make a reference to TPO under section 92CA of the Act for determination of the ALP. In the instant case, since the transaction exceeds the prescribed limit it becomes the specified domestic transaction for which reference was made by the AO to the TPO under ....

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....d hereunder: "8. Admittedly, in the instant case, there is no saving clause or provision introduced by way of an amendment while omitting sub-section (9) of Section 10B. Therefore, once the aforesaid section is omitted from the statute book, the result is it had never been passed and be considered as a law that never exists and therefore, when the assessment orders were passed in 2006, the AO was not justified in taking note of a provision which was not in the statute book and denying benefit to the assessee. The whole object of such omission is to extend the benefit under Section 10B of the Act irrespective of the fact whether during the period to which they are entitled to the benefit, the ownership continues with the original assessee or it is transferred to another person. Benefit is to the undertaking and not to the person who is running the business. We do not see any merit in these appeals. The substantial question of law is answered in favour of the assessee and against the revenue. Accordingly, the appeals are dismissed." 9. From the aforesaid judgments, it has become abundantly clear that once a particular provision of section is omitted from the statute, it shall be ....