TaxTMI 
TaxTMI 
2024 (7) TMI 1438
X X X X Extracts X X X X
X X X X Extracts X X X X
....he facts and in the circumstances of the case, the ITAT was legally justified in adjudicating that no royalty was payable by Dabur Nepal Pvt. Ltd. to the respondent as against the royalty chargeable at the rate of 7.5 percent on FOB sale value as worked out by the TPO/AO? 2. Whether on the facts and in the circumstances of the case, the ITAT was legally justified in adjudicating that royalty was payable by Dabur International Ltd. UAE at a reduced rate of 0.75 percent on FOB Value to the respondent as against the royalty chargeable at the rate of 4 percent on FOB sale value as worked out by the TPO/AO? 3. Whether the ITAT under the facts and circumstances of the case and in law was justified in confirming the deletion of t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s were ultimately worked out in terms of Section 115JB of the Income Tax Act, 1961 ["Act"] and the income subjected to tax was quantified at INR 211,42,99,386/-. 3. In that view of the matter, we find that there would be no justification to entertain these appeals on the aforesaid proposed questions of law. 4. Question 4 also raises no substantial issue bearing in mind the following conclusive findings of fact which have been returned by the ITAT and which reads as under: "63. As regards to the valuation of the shares of M/s Dabur Overseas Ltd., It is noticed that the assessee had 100% stake in M/s Dabur Overseas Ltd., an investment company which in turn had 76% stake in M/s Dabur Egypt Ltd. The remaining 24% of stake in M/s ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... during the course of assessment proceedings were adopted. In the present case, the ld. CIT(A) although directed the AO to adopt average of growth figure available for three years which came to 25% but ignored the growth rate based on actual figures for the future years. In the instant case, it is not pointed out as to how and in what manner the average growth figure taken by the assessee at 19% for succeeding years, on the basis of valuation report of an independent valuer was wrong. Therefore, we are of the view that the Ld. CIT(A) was not justified in adopting the figure of average growth at 25% instead of 19% adopted by the assessee. Accordingly, we modify the order of the ld. CIT(A) to this extent that the AO for the valuation of share....
X X X X Extracts X X X X
X X X X Extracts X X X X
....arts, giving heat treatment and machining. Die making was stated to be the primary process and is a separate industry by itself. It was noted, and rightly so, that each of the above process could be done in separate industrial undertaking, whereas the assessee had undertaken all these processes in its units. The issue was also that the assessee was doing these works on job basis for other undertakings, by getting the raw material from them. When the assessee was entitled to claim exemption in respect of income derived from such processes doing for itself, we do not see any reason as to why he would not be entitled to so merely because the raw material component was being supplied by other customers and for whom the assessee was doing the jo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....l for rendering them marketable. Without the heat treatment, the material is not fit for automobile industry. The learned counsel relied upon CIT v. Tamil Nadu Heat Treatment and Fetting Services (P) Ltd. (No. 2) (1999) 238 ITR 540 (Mad) wherein the activity carried out by the assessee consisted of receiving from its clients untreated crankshafts, forgings, castings, etc., and subjecting them to heat treatment in order to toughen them to the requisite standards, so that they could be sold in the market. The activity was held to be manufacturing and entitled to claim deductions. Similarly in the case of CIT v. Tamil Nadu Heat Treatment and Fetting Services (P) Ltd. (No. 1) (1999) 238 ITR 529 (Mad), it was held that the process of heat treatm....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... CIT v. Metalman Auto (P) Ltd. (2011) 336 ITR 434 (P&H) ; [2011] 52DTR (P&H) 385 ; (ii) CIT v. Vallabh Yarns (P.) Ltd. (2011) 335 ITR 518 (P&H) ; [2011] 51 DTR (P&H) 236 ; (iii) CIT v. Impel Forge and Allied Industries Ltd. (2010) 326 ITR 27 (P&H), (iv) CIT v. Rane (Madras) Ltd. (1999) 238 ITR 377 (Mad) and (v) Deputy CIT v. Harjivandas Juthabhai Zaveri (2002) 258 ITR 785 (Guj). 13. Keeping in view the activities of the assessee in giving heat treatment for which it had earned labour charges and job works charges, it can thus be said that the appellant had done a process on the raw material which was nothing but a part and parcel of the manufacturing process of the industrial undertaking. These receipts cannot be said to be indepen....