TaxTMI 
TaxTMI 
2021 (8) TMI 629
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....dication as the assessee entered into a Bilateral Advance Pricing Agreement (APA) with the CBDT dated 31.08.2018 which is applicable for 5 years commencing from Assessment Year 2016-17 to 2020-21 and roll back year commencing from 2012-13 to 2015-16. It was submitted by the learned Counsel for the assessee that the assessee has filed modified return of income as per the margin agreed under the APA and paid taxes accordingly. The AO is yet to pass an order in the modified returns filed on 22.11.2018 by the assessee. Grounds 2 to 11 accordingly were not pressed for adjudication by the assessee, hence dismissed. 3. Grounds 12 to 16 raised by the assessee reads as follows: Ground of appeal No. 12 - The learned AO/DRP/TPO have erred, in law and in facts, in determining separate transfer pricing adjustment on account of the interest on outstanding receivables amounting to INR 4,71,47,515. Ground of appeal No. 13 - Without prejudice to our ground of appeal No. 12 above, the learned AO/DRP/TPO have erred, in law and in facts, by not appreciating that the outstanding trade receivables from its AE's arise from the provision of IT enabled services transaction which is....
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....as the average collection period. 6. The Dispute Resolution Panel (DRP) vide its directions dated 06 September 2018, did not grant any relief and upheld the same to be a separate international transaction. However, the Hon'ble DRP directed the learned AO/TPO to compute interest on delayed receivables using short term deposit rates of interest of State Bank of India prevailing in FY 2013-14. The DRP held that if the funds were brought in time and those funds were properly deployed, the assessee may earn an income at the maximum rate applicable to deposits and not at the rate applicable to loans. Aggrieved by the order of the AO incorporating the addition as modified by the DRP, the assessee has raised ground Nos. 12 to 16 before the Tribunal. 7. The learned Counsel for the assessee brought to our notice that it had filed an application for Bilateral Advance Pricing Agreement to the competent authority under the Act in respect of the international transaction of allowing credit period to the AE also. As per the APA, a realization period of 60 days has been agreed for the realisation of invoices pertaining to international transactions (i.e. ITeS) from 01 April 2017 entered ....
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....logy/approach as agreed with CBDT in the APA covered years shall be applied for other years as well which are not covered under APA. Ameriprise India Pvt. Ltd. [TS-174-HC-2016(DEL)-TP] Celltick Technologies Ltd. [TS-552-ITAT-2019(Mum)-TP] Abicor Binzel Production (India) Pvt. Ltd. [TS-1036-ITAT-2017(PUN)-TP] 11. We have considered the submissions and are of the view that A.Y. 2014-15 is covered under roll-back period of the APA. Also, the FAR for all the years covered under APA is same. Hence, the period of realization of 60 days which is agreed in the APA for 01 April 2017 onwards should be considered for A.Y. 2014-15 as well. The principle laid down in the decisions referred to in paragraph 10 of this order will apply to the present case also. We hold and direct accordingly. 12. The issues with regard to corporate taxes are projected by the assessee in grounds 17 to 24 which reads as follows: 17. The learned AO/DRP have erred, in law and in facts. in treating software expenses of INR 6,50,52,354 as capital expenditure, without appreciating that such expenses are recurring, do not result in any enduring benefit, and are revenue in nature. ....
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....According to the assessee, the AO erred in not considering the impact of the disallowances in relation to expense incurred towards renewal of software licenses on the profit and gains from business and profession, on the deduction under section 10AA of the Act when passing the order. 14. On objections to the draft Order of Assessment, the DRP passed an order directing the AO to verify the invoices and allow the software expenditure if the license is for a period less than a year and if not, expenditure to be capitalised and depreciation to be allowed at 60% and also exclude the communication expenses and travel expenses in foreign currency that are attributable to delivery of product or service outside India from export turnover as well as total turnover while computing the eligible deduction under Section 10AA of the Act. 15. The AO passed final Order of Assessment pursuant to DRP's direction which is the order impugned in this appeal in which the bills were not submitted as per the requirements and being not supported by the purchase order and that the bills did not mention the period for which the expenditure was incurred towards software license and subscription to da....
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....1/2014 3,00,39,114 MS License - 6 Months ANZ Banking Group Limited FY14SW, 12/06/2014 2,16,99,608 1 Month Workware 8505, 31/01/2014 79,935.66 1 Month Workware 8506, 31/01/2014 6.87.881.7 1 Month Workware 8508, 31/01/2014 1,62.046.4 1 Month Workware 8455, 31/12/2013 7,01,356.5 1 Month Bloomberg 6750051347, 06/26/2013 10,17,514 1 Month Reed Business 2726, 18/07/2013 2,08,916 1 Month Reed Business 3772, 1/10/2013 251,950 1 Month Reed Business 3499, 19/09/2013 28,66,484 1 Month Total 5,97,37,271.26 Details of invoices filed vide submission dated 10 October 2018: Name of the Payee Invoice No Invoice Amount (INR) Period of License/ Subscription Valuepoint Techsol 100163 6,00,300 12 Months Dimension Data 7930028498 3,68,764 12 Months Thomson Reuters 71908763C 3,40,507 6 Months Thomson Reuters 71905967C 3,37,417 6 Months Bloomberg 6750047978 3,30,311 2 Months Bloomberg 6750049085 3,26,331 3 Months Bloomberg 6750057557 3,26,776 3 Months Bloomberg 675....