TaxTMI 
TaxTMI 
TaxTMI 
2023 (1) TMI 465
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....servations made by the TPO regarding the inadequacy of the documentation submitted by the assessee regarding these services?" 2. "Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) is correct in holding that the adjustment made by the TPO was not sustainable without examining the facts of the case and the evidences examined by the TPO and only relying on the judgement of the Hon'ble ITAT in a previous year?" 3. "Whether on the facts and circumstances of the case and in law, the Ld.CIT(A) is correct in deleting the adjustment made by the TPO relying on the judgement of the Hon'ble ITAT for a previous year, ignoring the basic tenet that the transfer pricing audit is highly facts-intensive and facts-driven and the contemporaneous facts have to considered and evaluated for every AY independently as dictated by Rule 10B(4) and by taking into account the comparability rules as enshrined in Rule 10B(2)?" 4. "Whether on the facts and in the circumstances of the case and in law, the Ld.CIT(A) is right in ignoring the fact that judgment of Hon'ble ITAT in the same case for AY 2007-08, 10-11 and 11-12 dated 27.05.2020 relied by him and the judge....
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....efore us. 7. The Learned Departmental Representative appearing before us submitted that the CIT(A) has deleted the transfer pricing additions without examining the observations made by the TPO. He submitted that the CIT(A) has merely followed the decision of the Tribunal in the case of the Assessee without considering or evaluating the relevant facts pertaining to Assessment Year 2012-13. The CIT(A) failed to appreciate that while examining transfer pricing adjustment contemporaneous facts are to be evaluated for every assessment year independently. Contra Learned Authorised Representative for the Assessee submitted that the Assessee had filed sufficient documents to prove rendition of services. In this regard, he relied upon the documents forming part of the paper-book and referred to submission dated 31.03.2021, filed before the CIT(A). He further submitted that the CIT(A), after examining the relevant facts and circumstances noted that the TPO had quantified the transfer pricing adjustment on the ground of non-rendition of services rather than on determination of the arm‟s length price for such services. The transfer pricing adjustments for the earlier years had been work....
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....management services but has suggested the ALP adjustment on the ground that a part of the payment is pertaining to provision for another year The DRP has confirmed the ALP adjustment by observing that "receipt of benefit in lieu of payment of service charges is sine qua non to allow the deduction for such payment to compute the income‟. It is also noted that "we also hold that the assessee has failed to explain and justify the allowability of R&D charges of prior years on merits and has also failed to show that it has benefit for such charges in the earlier years though the provision has been made in this year, and also failed to explain why the provision for the same was not made in the respective earlier years". On tender fees, the ALP is not disputed and yet ALP adjustment is confirmed on the ground that the evidences furnished by the assessee are not sufficient to establish that any services were actually rendered and that the assessee has indeed benefited from these services, and that the expenses pertained to the previous years and that these expenses cannot be disallowed in the present year. What is, however, completely lost sight of is what was before the DRP was an A....
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....case of CIT Vs Cushman and Wakefield (India) Pvt Ltd [(2014) 367 ITR 730 (Del)], and approving the path followed by a decision of Mumbai bench of the Tribunal in the case of Dresser Rand India Pvt Ltd Vs Additional CIT [(2012) 13 ITR (Trib) 422 (Mum)], had observed: xx xx 9. In the present case, the ALP adjustment has been made by the TPO and the DRP has "enhanced" the same. In the DRP order itself, it has been stated that "the TPO has suggested that the adjustment/ disallowance [Emphasis, by underlining, supplied by us now] of ........... is justified". That, however, is factually incorrect and legally unsustainable in law. Neither the ALP adjustments can be equated with disallowances of expenses, even though effect may be same, nor the TPO has the authority to disallow the expenses. Clearly, the impugned ALP adjustments are vitiated in law for this short reason alone. In any case, the observations with respect to the lack of evidence in support of the benefits is based on sweeping generalizations and is incapable of sustaining legal scrutiny. 10. In the light of the above discussions, as also bearing in mind entirety of the case, all the three ALP adjustments - namely (a)....