2020 (6) TMI 820

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....irming an upward adjustment u/s. 92CA(3) of the Act aggregating to Rs.14,24,500/-. 2. On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the action of A.O of initiating the penalty proceedings u/s 271(1)(c)." 3. The brief facts of the case as emanating from the records are: The assessee is engaged in manufacturing of speciality chemicals used in various products including paint industry. During the period relevant to the assessment year under appeal the assessee entered into International Transactions with its Associated Enterprise (AE) at Germany for sale of Di-Penta. The assessee applied CUP as the most appropriate method to benchmark International Transactions with its AE. The assessee sold 18,500 ....

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....that as per Rule -10B, while computing ALP by applying CUP as most appropriate method, there is provision for allowing volume discount. Further, to support his contentions in offering volume discount, the ld. Authorised Representative placed reliance on following decisions:- (i) Clarient Chemicals (India) Ltd. vs. JCIT, 44 taxmann.com 421 (Mum-Trib.) (ii) ITO vs. Adidas India Marketing (Pvt.) Ltd., 68 taxmann.com 96 (Del-Trib.) The ld.Authorized Representative of the assessee submitted that in assessment year 2009-10, the Tribunal had restored the issue to the CIT(A), for re-adjudication as the details of rate and volume were not furnished by the assessee. 5. Per contra, Shri Uodal Raj Singh, representing the Department vehemently d....

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....cturing Di-Penta since January 2009, as there was global economic slowdown and the demand for the product had reduced substantially. 7. We find that the Mumbai Bench of the Tribunal in the case of Clarient Chemicals (India) Ltd. vs. JCIT (supra), in principle accepted volume discount to AE, where there was substantial difference in volume of sales to AE and Non-AEs. In the case of ITO vs. Adidas India Marketing (P) Ltd. (supra), Delhi Bench of the Tribunal accepted discount on export of goods to AE where the assessee had sold old stock/ slow moving items to its AE. 8. Thus, in view of the facts discussed above, we are of the considered view that upward adjustment made in respect of sale of Di-Penta to AE is unjustified and hence, deserve....

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....g to lockdown held:- "10. In the light of the above discussions, we are of the considered view that rather than taking a pedantic view of the rule requiring pronouncement of orders within 90 days, disregarding the important fact that the entire country was in lockdown, we should compute the period of 90 days by excluding at least the period during which the lockdown was in force. We must factor ground realities in mind while interpreting the time limit for the pronouncement of the order. Law is not brooding omnipotence in the sky. It is a pragmatic tool of the social order. The tenets of law being enacted on the basis of pragmatism, and that is how the law is required to interpreted. The interpretation so assigned by us is not only incons....