TaxTMI 
TaxTMI 
TaxTMI 
2024 (5) TMI 1169
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....ome Tax, Delhi. After considering the objections, the Learned TPO passed order dated 31.10.2019. Assessee preferred objections to the draft order. Dispute Resolution Panel-2, New Delhi passed order dated 24.03.2021. After incorporation directions of Learned Dispute Resolution Panel ("DRP") dated 24.03.2021 Learned Assessing Officer ("Learned AO") passed order dated 30.04.2021. 3. Appellant / assessee preferred present appeal and sought permission to raise additional grounds of appeal in extension of ground No. 1. 4. Learned Representative for appellant / assessee submitted that Learned TPO and Learned DRP failed to appreciate that the provisions of section 92BA(i) of the Act were "omitted" by Finance Act 2017 and as a result of the said omission, the adjustment so made with regards to domestic transaction is without jurisdiction and is liable to be deleted. Hon'ble High Court of Karnataka in the case of Principal Commissioner of Income Tax vs Texport Overseas (P.) Ltd. reported in 271 Taxman 170 has held that "it is clearly noticeable that Clause (1) of section 92BA of the Act came to be omitted w.e.f. 01.04.2019 by Finance Act, 2014. As to whether omission would save the acts as....
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....fficer after the omission of the said clause by the Finance Act, 2017 even though transaction has undertaken in the Assessment Year 2016-17." Similar is position in Hon'ble ITAT Delhi Bench in ITA No. 2078/Del/2022 titled as DCIT vs DLF Urban Pvt. Ltd. decided on 8.4.2024. So appeal may be accepted. 6. Learned representative for department submitted that the assessee has raised additional ground in his appeal on 04.05.2023. Assessee has raised an issue with regard to TP adjustment under Specified Domestic Transactions and claimed as clause (i) of section 92BA has been omitted by Finance Act 2017 w.e.f 01.04.2017, accordingly, the assessee has stated that once this clause is omitted by amendment, it would be deemed that clause (1) had never existed in the statute and all the proceedings ever made prior to its omission, gets nullified and become invalid. Ground of retrospective application/omission of clause (i) of section 92BA has been dealt in detail by the DRP. The amendment has been made in section 92BA by Finance Act, 2017 which is applicable with effect from 01.04.2017. Hon'ble apex court's recent landmark decisions PCIT V/s Wipro Ltd. (2022) 140 taxmann.com 223, Commissioner ....
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....td. on which the decision of Hon'ble Karnataka High Court in the case of Texport is based, has already been overruled by the Hon'ble Supreme Court in the case of Fiber Boards Pvt. Ltd, and Shree Bhagwati Steel Rolling Mills Ltd. Further this position of law with regard to omission/repeal of a particular section in law has been addressed at length by the Hon'ble Mumbai Tribunal in the case of Fire Menich Aeromatics India Ltd. in ITA No. 348/Mum/2014 and ITA No. 1732/Mum/2014 for A.Y. 2009-10. 7. Learned representative for department submitted that the assessee has also relied on the order of ITAT Delhi in the case of Yorkn Tech Pvt. Ltd. vs. DCIT in ITA No. 635/del/2021 wherein the Hon'ble Bench has considered the decisions of the Hon'ble Supreme Court in the case of Shree Bhagwati Steel Rolling Mills Ltd. and Fiber Boards Pvt. Ltd. Bangalore vs. CIT and came to the conclusion that no TP adjustment can be made on a domestic transaction which has been referred to by the AO after the omission of the said clause by Finance Act 2017 even though transaction has undertaken in the A.Y. 2016-17. It is also fairly considered that this issue has again raised in the case o....
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....(India) Pvt. Ltd. (supra) we need to decide the impact of the judgement of the Hon'ble non-jurisdictional High Court in a situation in which these decisions canvassed a view contrary to what has been decided by another non-jurisdictional High Court. 28. In this context, without much indulgence on our part, we would like to rely on the order of the Mumbai Bench of the Tribunal in the case of Siro Slimpharma Pvt. Ltd. vs. ITO in ITA No.847/Mum/2016, order dated 09.09.2021 wherein while dealing with somewhat similar question of law, the Mumbai Tribunal has indicated that in the absence of judgment of Jurisdictional High Court, the non-jurisdictional High Court judgment has persuasive value and should be generally followed. The relevant part of the decision in paras 7 and 8 is as follows: "7. While on this issue, we may usefully take note of the observations of Hon'ble Supreme Court in the case of ACCE v. Dunlop India Ltd. [(1985) 154 ITR 172 (SC)], wherein the Their Lordships quoted, with approval, from the decision of House of Lords to the effect that "We desire to add and as was said in Cassell & Co. Ltd. v. Broome [1972] AC 1027 (HL), we hope it will never be necessary for us t....
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....vertheless the respect for the higher judicial forum was unambiguous. In Tej International Pvt Ltd Vs DCIT [(2000) 69 TTJ 650 (Del)], a coordinate bench has, on this issue, observed that "In the hierarchical judicial system that we have, better wisdom of the Court below has to yield to higher wisdom of the Court above and, therefore, one a authority higher than this Tribunal has expressed an opinion on that issue, we are no longer at liberty to rely upon earlier decisions of this Tribunal even if we were a party to them. Such a High Court being a non-jurisdictional High Court does not alter the position...". . There can, however, be exceptions to this situation on account of a variety of reasons, and these exceptions come into play only when the views are of non-jurisdictional High Court which, do not, legally speaking, bind the lower tiers of judiciary. In our considered view, so far as the precedence value of a non-jurisdictional High Court's judgment is concerned, the position has been very well summed up by a coordinate bench decision, in the case of Bank of India (supra), wherein, speaking through one of us (i.e. the Vice President), the coordinate bench has observed as follow....
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....deviated from. [Emphasis, by underlining, supplied by us] 8................ At one place, this decision, inter alia, states that "To a forum like us, following a jurisdictional High Court decision is a compulsion of law and absolutely sacrosanct that way, but following a non-jurisdictional High Court is a call of judicial propriety.....-which can...be, in deserving cases, deviated from". Implicit in this observation is the fact that not following non-jurisdictional High Court decision is more of an exception than the rule. There have to be very strong and good reasons not to follow even non jurisdictional High Court decisions...." 29. On the basis of the aforesaid principles of law of precedents and taking into consideration the fact that in a coordinate bench decision dated 20.07.2023 here in Delhi, in the case of Relaxo Footwear Ltd., Versus Assessing Officer, National e-Assessment Centre, New Delhi, ITA No.590/Del/2021, wherein one of us (the Judicial member) was on the Bench we had followed the decision of the Hon'ble Karnataka High Court in the case of Texport Overseas Pvt. Ltd (supra), we are of the considered view that the indulgence sought by ld. DR to accept the view....