2024 (8) TMI 529

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....is engaged in the business of providing sourcing, finance including evaluation of prospective customers, telemarketing, processing of purchase orders and fulfilment services, information and tracking of delivery schedules, managing distribution and logistics, customer relationship management services, accounting and processing of transactions, operational assistance for marketing, formation of customer services and pricing policies, infrastructural support services and other transaction processing to Du Point group companies. For the assessment year 2017-18, assessee filed the revised return of income on 23/03/2018 declaring an income of Rs. 1,77,52,150/-. In view of the international transactions of the assessee with the Associated Enterpr....

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....nce, no adjustment is proposed with respect to the transaction of provision of administrative support services." 5. Subsequently, the learned PCIT-1, Hyderabad issued notice under section 263 of the Act proposing to visit the issue relating to the assessee treating the foreign exchange loss as operating, and the assessee reiterated their stand as was taken before the learned TPO and also pleaded that there was detailed investigation by the learned TPO and, therefore, no revision of order could be done in view of the decision of the Hon'ble Supreme Court in the case of Malabar Industrial Co. Vs. CIT [243 ITR 83] (SC), where the twin conditions mandated under section 263 of the Act are satisfied. 6. In view of the amended provisions of sec....

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....hen it is beneficial to the assessee it is treating as operating in nature as it would increase its PLI, but at the same time, for the assessment year 2017-18, it treated the same as non-operating as it would decrease its PLI, but this aspect is totally not considered by the learned TPO. According to the learned CIT (IT & TP) not considering the nature of the foreign exchange loss in the light of the consistent accounting treatment given by the statutory auditors for the earlier and subsequent years, makes the assessment order erroneous insofar as prejudicial to the interest of Revenue. Learned CIT(IT&TP), therefore, set aside the assessment order and directed the learned TPO to compute the ALP of international transaction in respect of the....

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....tent accounting treatment given by the statutory auditors for the foreign exchange gain/loss in the audited financial statements and nowhere in the notice issued by the learned TPO or in the reply furnished by the assessee this aspect is adverted to assessee simply referred to the decisions reported in Bucher Hydraulics Private Limited and DHL Express (India) Private Limited (supra) and without considering the vital aspects, the learned TPO accepted the explanation of the assessee and, therefore, the learned CIT (IT & TP) is justified in revising the order under section 263 of the Act. 11. We have gone through the record in the light of the submissions made on either side. It could be seen from the notice dated 18/01/2021 issued by the lea....

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.... by collecting all the relevant facts which promote the accuracy of the decision. In this case, the non-consideration of the consistent economic policies and the accounting treatment given by the statutory auditors of the assessee to the foreign exchange gain/loss, impacts the correctness of the conclusions to be reached by the learned TPO insofar as the application of the correct precedent to such facts is concerned. 14. Though the submission of the learned AR that every assessment year has to be considered in relation to its own fact sounds correct, but it cannot be stretched to the extent of leading the exercise of the assessment proceedings to the level of absurdity. An assessee cannot approbate and reprobate in the same breath and say....