TaxTMI 
TaxTMI 
2022 (12) TMI 422
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....eal, the assessee has raised following grounds:- 1. The learned Income Tax Officer erred in law and in facts in determining taxable income at Rs.1,78,52,8111, instead of returned income at Rs.22,12,570. 2. The learned Income Tax Officer erred in law and in facts in determining tax payable at Rs. 85,65,440, including interest of Rs.33,64,211, u/s 234B of the Income Tax Act, 1961. 3. The learned Income Tax Officer erred in law and in facts in computing and levying interest u/s 234 8 amounting to Rs. 33,64,211. 4. Without prejudice, on the facts and in the circumstances of the case and in law, the learned Income Tax Officer erred in making an addition of Rs.1,56,40,237, to the total Income of the assessee ev....
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....ment of seafarer expenses. 4. The brief facts of the case pertaining to the issue, as emanating from the record, are: The assessee is engaged in the business of providing on-board crew management services for foreign Ship mangers/ Owners. This includes co-ordination of activities such as training, documentation, travel, promotions and other essential activities with respect to Indian sea farers employed on vessels managed / owned by foreign principals. For the year under consideration, the assessee filed its return of income electronically on 10/11/2016, declaring total income of Rs.22,12,570. 5. During the course of assessment proceedings, it was observed that the assessee has entered into international transactions with its Associat....
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....t paid by the assessee to its A.E. In support of its submissions, the assessee also filed petition under rule 9 of the DRP Rules, 2009, seeking admission of additional evidences in the nature of agreement entered into between the assessee and its A.E., summary of reimbursement of expenditure and other supporting documents. The said evidences were forwarded by the learned DRP to the TPO for analysis and comments. The TPO, vide letter dated 02/03/2020, filed its remand report in response to the additional evidences filed by the assessee. The learned DRP, vide directions dated 26/02/2021, issued under section 144C(5) of the Act, rejected the objections filed by the assessee on this issue on the basis that the assessee has failed to prove need,....
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...." incurred by the assessee in operating its business + 10%. It is the plea of the assessee that pursuant to the aforesaid agreement, expenses incurred by the assessee were reimbursed by the A.E. As per the assessee, a summary of reimbursement of expenditure is as under:- Particulars Amount (Rs.) Crew Visa Fees 16,99,112 Crew Miscellaneous Expenses 15,83,625 Crew Medical Treatment 2,23,867 Crew Training cost 22,83,280 Crew Hotel Cost 16,82,936 Crew Pre joining Medical 28,01,975 Crew Compensation 9,00,000 Crew SWF 24,40,728 Crew Seminar 1,37,220 Bank Charges 6 Courier charges 2,88,426 Crew Travel charges 1,77,849 10. As the aforesaid expenses were reimbursed by t....
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....s A.E. and upheld the adjustment made by the TPO by treating the arm's length price of international transaction to be Nil. From the perusal of the record, it is evident that it is not the case of the Revenue that the mark-up charged by the assessee for the services rendered to the A.E. under the aforesaid agreement is not at arm's length price. The Revenue has only doubted the genuineness of the alleged reimbursement of expenses made by the assessee to its A.E. However, as noted above, the transaction is not reimbursement of expenses by the assessee to its A.E. and rather, is reimbursement of expenses by the A.E. to the assessee. In view of the above, we are of the considered opinion that the impugned adjustment made by the TPO and....