TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 1166
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....("TPO") for determination of Arm's Length Price ["ALP"] of such transactions. The TPO vide order dated 31.07.2021 u/s 92CA(3) of the Act proposed certain adjustments. The AO passed draft assessment order u/s 144(1)/144B wherein besides the adjustments proposed by TPO, certain other disallowances were proposed by the AO on account of lease hold expenses and e-shop expenses and accordingly, total income of the assessee was proposed to be assessed at INR 4,32,14,89,191/-. 3. Against this order, the assessee raised objections before Ld. DRP, who in terms of the order dated 30.05.2022 passed u/s 144C(5) of the Act, gave certain directions to the AO and accordingly, the objections raised by the assessee were decided. Subsequently, the AO passed the final assessment order u/s 143(3)/144C(13) of the Act on 27.07.2022 at the same income as has been computed in the draft assessment order at INR 4,07,29,84,576/- by making following additions/disallowances:- (i) TP adjustment of INR 35,02,39,074/-; (ii) Disallowance of lease hold expenses of INR 11,49,23,267/-; (iii) E-shopping expenses of INR 11,12,27,375/-. 4. Against this order of AO, the assessee preferred appeal before the Tribuna....
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....ellant in nature of development of marketing intangibles for its AEs which needs to be reimbursed by the AEs along with mark-up. 5.4 Failing to appreciate the functional profile of the Appellant and its financial arrangement with DPIF/DDF. 5.5 Incorrectly benchmarking the AMP expenses incurred by the Appellant by undertaking intensity adjustment. 5.6 Incorrectly benchmarking the AMP expenses incurred by the Appellant by applying 'bright line method and computing protective adjustment thereof. 5.7 Making dual adjustment which is not allowed under the provisions of the Act. 5.8 Incorrectly concluding that Appellant has undertaken AMP expenses for the benefit of DPIF/DDF, whereas the Appellant is earning all the residual income from the business and only paying fixed royalty to the franchisors. 6. Without prejudice to the contentions stated in ground no. 5 supra, the impugned AMP adjustment is devoid of accuracy in as much as: 6.1. The additional comparable companies proposed by the Appellant for computation of arm's length AMP/Sales, were rejected by misapplication of persistent losses filter. 6.2. The quantum of AMP adjustment contained the value of selling e....
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..... That on facts of the case and in law, the Ld. AO/Ld. DRP erred in not appreciating that entire leasehold improvements expenditure claimed as revenue expenditure amounting to Rs. 11,49,23,267 is an allowable expenditure under section 37(1)/30(a)(i) of the Act. 9.3. That on facts of the case and in law, Ld. AO/ Ld. DRP failed to appreciate that the similar issue has been decided by the Hon'ble ITAT in Appellant's favour in its own case for AYs 2012-13 and 2013- 14 and further affirmed by the Hon'ble High Court. 9.4. Without prejudice to the above, Ld. AO erred in not allowing the expenditure of INR7.75.23.358 which has been considered as revenue expenditure as per the directions given by Hon'ble DRP and to this extent the adjustment made is excessive and has no legs to stand. 9.5. Without prejudice to the above, Ld. AO erred in not allowing depreciation of Rs.56,09,978 on disallowance of Leasehold expenditure. 10. On facts of the case and in law, the Ld. AO has erred in not granting the credit of INR 3,35,80,952 in respect of Dividend Distribution Tax chimed by the Appellant and further erred in levying interest under section 115P of the Act. 11. On the fa....
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.... v. ACIT Circle 3(1) (1), Bangalore [IT(TP)A No.832/Bang/2017] [ii]. Software Paradigms Infotech (P.) Ltd. v. ACIT [2018] 89 taxmann.com 339 (ITAT Bangalore) [iii]. July Systems & Technologies Put. Ltd. v. DCIT [2018] IT(TP) A No. 368/Bang/2016 (ITAT Bangalore)." 8. On the other hand, Ld.CIT DR submits that the failure on the part of AO in not incorporating the directions given by DRP in the final assessment order is not a fatal error for which the order could be held as bad in law. Ld.CIT DR further submits that solely on this issue, the entire proceedings cannot be held bad in law. He placed reliance on the judgment of Hon'ble Jurisdictional High Court in the case of SRF vs NFAC, Delhi reported in 129 taxmann.com 174 [2021] (Del.) and also in the case of Anand NVH Products Ltd. vs N E Assessment Centre, Delhi in WP(C) 7936/2021 dated 06.08.2021 and judgement of Co-ordinate Bench of Tribunal, Delhi Benches in the case of Hitachi Astemo Haryana Pvt.Ltd. vs DCIT in ITA No.1005/Del/2022 and in the case of Honda R & D Pvt.Ltd. vs DCIT in ITA No.376/Del/2015 [AY 2010-11] order dated 19.09.2024. In all these judgements, it is held that the final assessment order passed without inco....
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....aryana Pvt.Ltd. (supra), the Co-ordinate Bench of ITAT, Delhi after considering the aforesaid orders of Hon'ble High Court set aside the final assessment order to the file of AO for incorporating DRP's directions. The Relevant observations as in para 6 to 8 of the said order are as under:- 6. "We have heard both the parties and perused the records. We have given very thoughtful consideration to the above submissions and case laws. We find that the ld. Counsel of the assessee relied upon the Tribunal decisions and one decision from Hon'ble Karnataka High Court (supra). On the other hand, ld. DR for the Revenue has relied upon three case laws from Hon'ble jurisdictional High Court and one decision from Hon'ble Madras High Court. We find that Hon'ble jurisdictional High Court is binding on the Tribunal, hence we adjudicate this issue with reference to the orders of the Hon'ble jurisdictional High Court referred above, as the facts are similar. 7. In the case of Anand NVH Products Pvt. Ltd. (supra), we noted that assessment order has been passed under section 143(3) read with section 144C of the Act without waiting for the decision of the DRP. Hon'ble High Court in that case set as....