TaxTMI 
TaxTMI 
2022 (2) TMI 1085
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....y 2015, passed by the Commissioner of Income 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') amongs....
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....le Financial Services Software America, Inc. 3. As per the MAP resolution agreed upon by the two CAs, the computation of MAP relief and the 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 (....
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.... "1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in deleting the disallowance of 40(a)(ia) without appreciating that the provisions of section 194 are attracted in respect of payments made to the group entities. 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 market....
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....airs & maintenances, employee welfare, stationary supplies, courier charges, etc.) 395 1961277 Total: 662222 43834698 9. During the course of assessment proceedings, the Assessing Officer issued show cause to assessee as to why the said expenditure should not be disallowed under section 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 reimbu....
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....der Pal Singh, appearing for the Revenue, vehemently relied upon the order passed by the Assessing Officer and prayed that the same be upheld on the issue of disallowance under section 40(a)(ia) of the Act. 13. On the other hand, the learned A.R. submitted that the issue arising in Revenue's appeal has been decided by the Co-ordinate Bench of the Tribunal 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 2....
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....d on cost to cost basis without any profit element, the payments so made cannot be considered to be of the nature covered under section 194C of the Act. Therefore, there is no requirement for assessee to deduct tax under the said provision. As far as the amount of Rs. 69,736 is concerned, on perusal of material on record, it is evident that such payment was towards reimbursement of expenditure incurred towards purchase of air tickets, gift vouchers, etc. Thus, the nature of payment indicates that they are not of the nature as covered under section 194C of the Act. That being the case, there is no liability on the assessee to deduct tax at source on such payment. Therefore, in our considered opinion, the learned Commissioner (Appeals) was ju....