TaxTMI 
TaxTMI 
2026 (7) TMI 274
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....s of the Hon'ble DRP are bad in law and ought to be quashed. Consequently, the final assessment order dated 23 October 2024, is bad in law and ought to be quashed. 2. On the facts and circumstances of the case and in law, the Ld. AO has erred in not passing the final assessment order dated 23 October 2024 as per the directions of the Hon'ble DRP Panel as prescribed in section 144C(13), thereby rendering the assessment order being null & void and liable to be quashed. 3. On the facts and circumstances of the case and in law, the final assessment order dated 23 October 2024 is issued beyond the time limit as prescribed u/s. 153 of the Act. Consequently, the final assessment order is time barred and deserves to be quashed. 4. The Hon'ble DRP erred in confirming the action of the AO/TPO ignoring the fact that there was no intention by the Appellant to shift profits outside India. 5. The Hon'ble DRP erred in upholding/confirming the action of Ld. TPO, in applying Other Method inappropriately and further erred by not bringing on record any comparable data as mandated by section 92C of the Act read with Rule 10B and Rule 10C of the Rules....
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...., duplicative or incidental services for which no independent entity would agree to make any payment. 13. Not appreciating that the Appellant duly withheld the taxes on payment made to the AE and that the AE has also duly filed a return of income in India offering such services to taxes, and that disallowing payments made by the Appellant would lead to double taxation. 14. Not appreciating that the said payment for intra group services of INR 5,08,88,475 has a direct nexus with the business of the appellant. Accordingly, the Ld. AO / Hon'ble DRP have erred in disallowing the said payment u/s. 37 of the Act. 15. Initiating penalty proceedings under section 274 read with section 270A of the Act, without appreciating the fact that the additions made by the Ld. AO are not in accordance with the law. Erroneous addition of income of Rs. 22,47,269 to the loss reported in ITR Form based on Intimation issued by CPC under Section 143(1) of the Act 16. On the facts and circumstances of the case and in law, the AO has erred in determining assessed income by adopting the starting number as a loss of Rs. 4,23,75,087 as per intimation dated 30 May ....
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.... 23. The Appellant prays that the set-off of eligible brought forward business loss and unabsorbed depreciation be granted and total taxable income be recomputed at Rs. Nil and balance business loss / unabsorbed depreciation be allowed to be carried forward to AY 2022-23. Interest levied under Section 234A and 234B of the Act. 24. On facts and circumstances of the case and in law, the AO erred in levying interest of Rs. 66,320 under Section 234A and Rs. 7,12,940 under Section 234B of the Act. 25. The Appellant prays that the charging of interest under Sections 234A and 234B of the Act, is erroneous, unwarranted and be deleted. The Appellant prays that the additions made by the Ld. TPO/Ld. AO under the directions of the Hon'ble DRP be deleted and consequential relief be granted. The Appellant craves leave to add, alter, amend and/or withdraw any of the above grounds of appeal and to submit such statements, documents and papers as may be considered necessary either at or before the hearing of this appeal as per law." 3. At the time of hearing, ld. Counsel for the assessee has not pressed Grounds of appeal No. 1 to 5, 19 and 20 and ....
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....r making the adjustment for Intra Group Services and assessed income at Rs. 85,13,390/-. Aggrieved assessee is now in appeal before this Tribunal. 8. As regards Ground of appeal Nos. 16 to 18 and 21 to 23, a prayer has been made by ld. Counsel for the assessee for restoring the matter to the file of ld. Jurisdictional Assessing Officer for necessary verification. In support, submissions have been filed which are reproduced below : 9. On going through the above submissions given in support of Grounds of appeal Nos. 16 to 18 and 21 to 23 which mainly relates to the alleged wrong addition made in processing of return u/s. 143(1)(a) of the Act as well as set off if brought forward business losses and unabsorbed depreciation not granted, we deem it appropriate that the matter deserves to be restored to the file of ld. Jurisdictional Assessing Officer for necessary examination and verification and to decide in accordance with law for which necessary opportunity of hearing be given to the assessee. 10. So far as factual grounds of appeal Nos. 6 to 15, they have been raised against the addition made for disallowance of payment of Intra Group Services at Rs. 5,08,88,475/- which is ....
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....in the nature of on call services. We therefore are of the considered view that the observations of ld. DRP that assessee has not received any services from its AE is uncalled for. We hold that the assessee has incurred expenditure in the form of services received from its AEs which have been shown under the head Intra Group Services and has the assessee not taken these services from its AE, then it would have incurred cost for making payment to a third party. Since the ALP adopted by the assessee based on TNM method has not been examined by the ld. TPO in light of the prescribed method, the issue therefore needs to be restored to the file of ld. TPO for necessary examination of the ALP. We therefore hold that alleged expenditure have been incurred towards Intra Group Services. Grounds of appeal No. 6 to 15 raised by the assessee are allowed for statistical purposes." 11. Respectfully following the same we hold that the assessee has incurred expenditure in the form of services received from its AEs which have been shown under the head Intra Group Services and has the assessee not taken these services from its AE, then it would have incurred cost for making payment to a third par....
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..../2024] has accepted the position that the order u/s 143(1) merges with order u/s 143(3) and it supersedes it. - Therefore, adoption of income as per Section 143(1) in assessment order u/s 143(3) without discussion is not correct and issue shall be remanded back to AO for verification of documents and granting allowance. Ground no. 21, 22 & 23: Set off of brought forward business loss and unabsorbed depreciation not granted 1. ITR for AY 2020-21 Filed on 15 March 2022, disclosed amount of losses available for set off from past years - 'Schedule CFL' & Schedule UD. - Refer page no. 2313 - 2426 of paperbook. Business loss - 37.03 crore UAD - 10.49 crore Above losses were also disclosed in tax audit report at Clause 32(a). - Refer page no. 2427 - 2459 of paperbook. 2. While passing assessment order dt. 23 Oct 2024, the AO did not grant set off of above losses against transfer pricing addition of Rs. 5.08 crore, without any discussion on this matter - refer page no. 2464 - 2471 of paperbook Document 2 3. Section 72(1) allows set off of carried forward business losses against profits & gains from business and Section 32(2) allows UAD to set off against busine....