2022 (2) TMI 1085

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....e Tax (Appeals)-57, Mumbai, under section 250 of the Income-tax Act, 1961 (hereinafter referred to as "the Act") for the assessment year 2009-10. ITA No. 2837/Mum./2015 Assessee's Appeal- A.Y. 2009-10 2. At the outset, Shri Ajit Jain, learned Authorised Representative (hereinafter referred to as "the learned A.R."), appearing for the assessee submitted that the assessee, vide letter dated 27th January 2022, filed before the Tribunal has prayed for withdrawal of its appeal being ITA No. 2837/Mum./2015, for the assessment year 2009-10, as the assessee has received the communication dated 10th October 2022 of resolution/closure of dispute under Mutual Agreement Procedure (MAP') amongst Competent Authorities of India and U.S.A. for t....

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....e retained TP adjustment is as follows: Calculations for A.Y. 2009-10 Operating Cost 169674000 Price received (A) 201695000 Price received (related to US) (B) 181453430 % of transaction with US (C) 89.96% Operating Cost (US related) 152645972 Percentage margin as per applicant 18.87% % margin as per TPO 25.39% ALP as per TPO 212574000 ALP as per TPO (US related) 191240643 Adjustment 10879000 Adjustment (US related) 9787213 Margin as determined by India CA 18.87% ALP as per Indian CA 201695000 ALP as per India CA (US related) 181453430 Adjustment as per India CA (US related) 0 Relief to be provided by Indian CA (US related) 9787213 4. As per rule 44G(7) of the Rules, you are requested to communicate your a....

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.... 2. The appellant prays that the order of the CIT(A) on the above ground be set aside and that of the A.O. be restored." 7. The only issue raised by the Revenue in its appeal is regarding deletion of disallowance under section 40(a)(ia) of the Act. 8. The brief facts of the case pertaining to this issue as emanating from the records are: The assessee is engaged in the business of providing Knowledge Process Outsourcing services to the financial services (capital markets) industry abroad. On 1st April 2007, the assessee entered into "Marketing Service Agreement" with I-Flex Solutions Inc. In terms of the said agreement, I-Flex Solutions Inc. has sub-contracted to the assessee certain works under contracts entered into by I-Flex Solutions....

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....ion 40(a)(ia) of the Act for non-deduction of TDS. In response, the assessee submitted that the payments made to Equinox Global Services Ltd. and I-Flex Solution Ltd. (India), were not for doing any 'work' or for provision of any 'Professional/Technical Service' by Equinox Global Services Ltd./I-Flex Solution Ltd. (India) to the assessee. Further, the payments were mere reimbursement of actual costs incurred by Equinox Global Services Ltd./I-Flex Solution Ltd. (India) on behalf of the assessee, and thus, do not represent expenditure for any work or service in respect of which tax is deductible as per the provisions of the Act. Accordingly, the assessee was not liable for withholding any tax on such payments. 10. The Assessi....

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....l in assessee's own case for assessment year 2010-11, wherein the Tribunal has upheld the deletion of disallowance under section 40(a)(ia) of the Act. 14. We have considered the rival submissions and perused the relevant material available on record. We find that on identical issue the Co- ordinate Bench of the Tribunal in assessee's own case vide order dated 24th January 2018, passed in ACIT v/s Oracle (OFSS) Processing Services Pvt. Ltd., ITA No. 7325/Mum./2015, for the assessment year 2010-11, dismissed the Revenue's appeal by observing as under:- "6. We have heard rival contentions and perused the material available on record. At the outset, it needs to be observed, the subject matter of dispute in ground no. 1 is restric....