TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 1035
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....eafter, pursuant to APA entered into with CBDT, the Appellant filed modified return of income on 29. 05.2019 declaring total income at Rs. 124,34,58,390/-. The case of the assessee was selected for complete scrutiny. Since, the assessee has entered into international transactions, therefore, the reference was made to the TPO to compute the Arm's Length Price u/s 92CA of the Act in respect of the international transaction carried out. The TPO vide its order passed u/s 92CA(3) dated Nil proposed an upward adjustment of Rs. 1,53,73,858/- to the value of the International Transaction entered into by the assessee. Thereafter, the AO has passed a draft assessment order u/s 144C of the Act wherein the AO has proposed the additions towards the adjustments done by TPO in international transaction at Rs. 1,53,73,858/- and further proposed disallowance on delayed payment of employees contribution of PF and ESI of Rs. 50,484/-. 3. Aggrieved by the draft assessment order, the assessee filed objections before the ld. DRP, who though confirmed the action of the TPO, however direct the TPO to verify the contention raised by the assessee and adopt correct working capital margins as pointed out by ....
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....le to the Appellant in terms of the functions performed, assets employed and risks assumed. 2.8. rejecting additional companies proposed/ identified by the Appellant even though they are comparable to the Appellant in terms of functions performed, assets employed and risks assumed, 2.9. denying the benefit of working capital adjustment to the Appellant by not computing the margins of the comparables in a consistent manner; 2.10 denying the benefit of risk adjustment to the Appellant by disregarding the difference in risks assumed by the Appellant vis-à-vis comparable companies proposed by the Ld. TPO, and 2.11 Without prejudice to the above contentions raised by the Appellant, the Ld. TPO has failed to give effect to the directions issued by the Hon'ble DRP to verify the operating margins of the comparables and re-compute the adjustment. Corporate Tax Grounds 3. On the facts and circumstances of the case and in law, the Ld. AO/Ld. DRP erred in disallowing a sum of INR 50,484 pertaining to employees' contribution to PF without appreciating the fact that the said amount was duly deposited before the due date of filing the return under section 139(1) of the ....
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....sessee submitted that the assessee has selected TNMM as most appropriate method and by using gross profit/total costs as PLI, computed the ALP where the tested parties margin was 20% and on the basis of 9 comparable companies, the adjusted average rate comes 11.46% to 15.68% with the median of 15.49%. Since the median margin comes to 15.49% of the comparables and assessee's margin was 20%, therefore, no adjustment was made by the assessee on such transactions. The assessee selected 9 comparable companies which are as under: S. No. Name of the Company Data Source Average OP/TC Working Capital Adjusted OP/TC 1 IIML Asset Advisors Ltd. P 29.23% 27.03% 2 HDFC Property Ventures Ltd. -Advisory segment P-Seg 54.42% 55.50% 3 Acuitas Capital Advisors Pvt. Ltd. SEBI 1.23% 0.91% 4 IDG Ventures India Advisors Private Ltd. SEBI 15.50% 15.68% 5 India Life Capital Private Ltd. SEBI 10.02% 9.55% 6 Logictree Investment Advisors Pvt. Ltd. SEBI 15.14% 15.49% 7 Money Capital height Research Investment Advisers Pvt. Ltd. SEBI 10.38% 11.46% 8 Money Maker Research Pvt. Ltd. SEBI 6.71% 7.72% 9 SPT Investment Advisory Services Pvt. Ltd. SEBI 38.04% 38.93% ....
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....ate Ltd ('SG Analytics') which is accepted by the ld. DRP in assessee's own case as fit comparable in the order passed for Assessment Year 2018-19, and also passes all the quantitative filters of the TPO for year under appeal however, the same has not been taken into consideration. The Ld. AR further submits that the other two comparable companies as proposed by assessee namely Axience Consulting Private Limited ('Anxience') and Cyber Media Research and Service Limited ('Cyber Media') have also passed all the filters applied by assessee as well as modified filters applied by TPO and, therefore, these should be included in the final set of comparables. The ld. AR further submitted that the AO included additional compare companies proposed and identified by him for which the argument as made by the assessee are reproduced as under: 11. The ld. AR further submits that the assessee has submitted before the ld. DRP that TPO has committed factual error in the working capital (OP/TC) computations for certain companies selected in the TPO's Order. The Hon'ble DRP in para 6.25 has directed the AO/ TPO to consider the objections of assessee and direct to consider the correct margins after d....
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....ssessee are partly allowed for statistical purposes. 15. Ground of Appeal No.4 is with regard to the levy of interest u/s 234B and 234C. In this regard, the assessee submitted that it is entered into Advance Pricing Agreement (APA) with CBDT which has resulted into enhanced income and thus additional tax was payable for the purpose of filing the modified return of income. While filing the modified return of income, the utility provided by the Govt. e-filing portal was taken wherein as per the utility provided interest u/s 234B and 234C is charged on modified income. The Ld. AR submitted that in terms of APA entered by the appellant with CBDT, it does not specify the payment of any interest u/s 234B and 234C on the additional tax liability as a result of enhanced margin, however, to validate the return of income, assessee has to make the excess payment of interest u/s 234B and 234C amounting to Rs. 1,39,11,946/- which though actually was not payable. The Ld. AR submit that after filing the modified the return, a letter dated 21/06/2019 was filed along with a physical form of modified return where tax was computed (without interest u/s 234B and 234C on such enhanced margin) and requ....
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....of income was made for the purpose of advance tax. Since, it is not possible for the assessee to file modify the return through e-filing portal unless the additional amount of interest u/s 234B and 234C was paid which was computed in accordance with utility provided by the official website of the Department, therefore, assessee was left with no alternate but to deposit the interest u/s 234CB and 234C so computed. Therefore, the claim of the assessee for refund of such excess payment of interest/s 234B and 234C of the Act is a genuine claim. The Co-ordinate Bench of the Tribunal in case of Colte Technology Services India Pvt. Ltd. (supra) has also of the view that any additional income on account of APA between assessee and CBDT should not be lead to additional interest liability of 234B and 234C of the Act. The observations of the Co-ordinate Bench in the case of Colte Technology Services India Pvt. Ltd. are as under: "35. We have heard the Ld. AR and also Ld. DR on the issue in dispute, we are agreeing with the argument of the Ld. AR 36. In the case of Prime Securities Ltd. Vs. Assistant Commissioner of Income Tax (Investigation), [2012] 20 taxmann.com 757 (Bombay), the Hon....
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.... is paid and there is a default. Therefore, for charging interest under section 234B, committing of default in payment of advance tax is condition precedent. Perusal of the judgment of the Delhi High Court, which is relied on by the learned counsel appearing for the respondent, shows that in that case also the Delhi High Court has held that for charging of interest establishment of default in payment of advance tax is necessary. In the present case, it is nobody's case that the appellant at the time of payment of advance tax has committed any default or that payment of advance tax made by the appellant was not in consonance with law. The Division Bench of this court in its judgment in the case of the appellant, referred to above, has held that the return filed by the appellant was in consonance with law and there was only a formal defect and the moment that defect was cured, the return related back to the original date. In our opinion, when the Supreme Court in Ghaswala's case (2001) 252 ITR 1 says that charging of interest under section 234B is mandatory, what it realty means is that once the assessee is found liable to pay interest, then recovery of interest is mandatory ....