TaxTMI 
TaxTMI 
2026 (4) TMI 1296
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....of the appellant to the Transfer Pricing Officer. The Dispute Resolution Panel, hereinafter referred to as the DRP, has erred in confirming the action of the assessment unit on this point. 1.2 The appellant respectfully submits that on the facts of its case, the provisions of section 92 are not applicable in its case and accordingly the reference to the Transfer Pricing Officer is not permissible in its case. 1.3 The appellant therefore submits that all subsequent action taken by the assessment unit and the Dispute Resolution Panel in its case are not valid and the assessment order passed deserves to be quashed for this reason. 2. Objection against confirming treating the Reimbursement of Expenses by the Associated Enterprise of the appellant as "International Transaction" 2.1 The Dispute Resolution Panel has erred in confirming the action of the assessment unit in treating the Reimbursement of Expenses by the Associated Enterprise of the appellant as "International Transaction" 2.2 The appellant respectfully submits that its transaction with the Associated Enterprise cannot be termed as "International Transaction" as per the definition ....
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....prise. The DRP has erred in attributing 90% of the profits of the Associated Enterprise to be subjected to tax in the hands of the appellant. 4.3. The appellant respectfully submits that the functions carried out by the appellant are having negligible value in the business of the Associated Enterprise and there is no justified reason for attributing 90% of the profits of the Associated Enterprise on the facts of its case. 4.4 The appellant, therefore, prays that even if the adjustment is held to be applicable the same may be confined to the extent of the value of the services provided by the appellant and appropriate relief in this regards may please be allowed. 5 Objection against not giving directions in relation to the initiation of penalty proceedings u/s. 270A of the Act 5.1 The Dispute Resolution Panel has erred in not issuing any direction to the assessment unit in connection of initiation of penalty proceeding u/s. 270A of the Act despite of a specific ground raised by the appellant. 5.2 The DRP has erred in not appreciating the fact that the case of the appellant is covered by clause (d) of sub-section (6) of section 270A and ac....
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....ITAT, Mumbai in case of Ness Technology (India) (P.) Ltd vs DCIT (2019) 111 taxmann.com 386. The Ld.AR submitted written note explaining the entire activities of the assessee and AE, which is reproduced below:- "1) Customer Acquisition and Relationship Management Customers from around the world directly approach the Mauritius Company whenever they require services. The company allows customers to settle their invoices in multiple currencies as well as through forex cards. It maintains several multi-currency bank accounts in Mauritius. In line with Reserve Bank of India (RBI) guidelines, payment in multiple currencies are not permitted through India issued forex cards. Considering this, the customers who wish to make payment in multiple currencies will directly approach the Mauritius Company for their booking. This makes it possible for the customers to make the payment in multiple currencies through the forex cards. Such customers directly approach the Mauritius companies and the Indian LLP does not have any role in acquisition of such customers for the Mauritius Company A substantial portion of new business comes through word-of-mouth referrals.....
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....he Mauritius Company. 4) Air Ticket Booking and Travel Arrangements Neither the Indian LLP nor the Mauritius Company books air tickets or provides travel-related arrangements. 5) Ground Transportation and Logistics Neither the Indian LLP nor the Mauritius Company provides services related to ground transportation or logistics. 6) Payment Processing and Vendor Management The Indian LLP processes payments and informs the Mauritius Company once completed. Subsequent vendor coordination and service delivery are handled by the Mauritius Company. 7) Out-of-Pocket Payments Normally there are no cases of out of pocket payments. If at all some such expenses are incurred by the Indian LLP, they are fully reimbursed by the Mauritius Company. 8) Customer Service and After-Sales Support The Indian LLP makes payments on behalf of the Mauritius Company. Once the payment is completed, the Indian LLP has no further role. All customer handling and after-sales services are managed by the Mauritius Company. The Mauritius Company provides after-sales support in accordance with customer requirements. Any requests f....
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....which is extracted below:- "1. This written submission is being submitted on behalf of the revenue in furtherance of the oral arguments made during the course of hearing the Part Heard matter on 05-12-2025 2. The orders of AO and CIT(A) are emphatically relied upon. 3. The dispute pertained to payments made to the Mauritius based AE of the assessee, which were claimed to be mere reimbursements of the payments made by the assessee on behalf of the assessee. The gist of the department's argument was that as per the financials of the AF (as requested and received from Mauritius Tax Authorities), there was nothing in the Financials that would suggest that the AE had capacity to carry out various functions claimed by the assessee. The AO and CIT(A) held the Profit Split Method to be the Most Appropriate Method seeing that the overall provision of tour and travel services had different functions most of which were being done by the assessee only. It was concluded by CIT(A) that the overall commercial activity of providing "tour and travel services" can be divided into 10 equally valuable functions and out of 10 equally valuable functions involved in overall....
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....clearly mentions that payments to hotels are par of the services claimed to have been provided by the AE. Further clause (2) of para 4 clearly mentions that these are the expenses paid on behalf of the assessee. The same claim has been repeated in para 7 on the same page and further in para 11 on page 69. 8. Thus, the claims made on behalf of the assessee are not correct and it is prayed that the same may he rejected. 9. Without prejudice to the above it is also prayed before Hon'ble Bench that to bring out the Functions, Assets and Risk Profile (FAR) of the AE through complete documentary evidences (including financials) was on the assessee and in failing to produce the same the assessee failed to rebut AQ's observations. Accordingly, it is prayed that the department's arguments may be considered in a favourable light and the appeal of the assessee be dismissed." 7. We have carefully considered the rival submissions, the written submissions filed by both the parties, and the material available on record. We find that the core controversy in the present appeal revolves around the correct characterization of the transactions between the assessee LLP ....