TaxTMI 
TaxTMI 
2026 (9) TMI 601
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Act pursuant to the Directions passed by the Ld. Dispute Resolution Panel - 2,New Delhi ["Ld. DRP'']. As majority of the grounds of appeal raised in the captioned appeals are identical, the same are dealt with hereunder in a consolidated manner considering AY 2010-11 (bearing ITA No. 1021/Del/2015 and 1135/Del/2015) as the lead year and the decision rendered there is shall be applied mutatis mutandis to other appeals. ITA No. 1021/Del/2015 (A.Y. 2010-11) (Assessee Appeal) 2. The brief facts of the case are that the assessee is a cellular mobile telephony service provider. For the year under consideration, the appellant filed its return of income on 05.10.2010 which was thereafter revised on 29.03.2012, declaring 2,31,22,12,779/- income and a book profit of Rs. 3,96,51,69,284. The return filed by the appellant was selected for scrutiny, and statutory notices under section 143(2) and section 142 (1) were issued and served upon the appellant. The Transfer Pricing Officer in terms of the Order dated 27.01.2014 passed u/s. 92CA(3) of the Act made upward adjustments aggregating to Rs. 80,64,73,603/- Vide Draft Assessment Order dated 31.03.2014 passed under section 144C read wit....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion ('DOT'). Since, the Appellant is engaged in providing telecommunication service, it is eligible for deduction u/s 80IA of the Act. As per sub-section (2A) of Section 80IA, an undertaking providing telecommunication services is eligible for deduction u/s. 80IA of the Act at the rate of 100% of the profits and gains of the eligible business for the first five AYs commencing at any time during the specified period of 15 years and thereafter, at the rate of 30% of such profits and gains for further five AYs. 6. During the year AYs 2003-04 to 2005-06, the assessee filed its return of income disclosing 'Nil' taxable income under the normal provisions of the Act, after setting off tax losses of the prior years. Accordingly, no claim for deduction u/s. 80IA of the Act was made by the assessee in its return of income filed for these three years. The returns of income for the aforesaid years were selected for scrutiny and Orders u/s. 143(3) of the Act were passed by the Ld. AO, wherein the Ld. AO made certain disallowances/ additions. Owing to such disallowances/ additions, the Ld. AO allowed deduction u/s. 80IA of the Act in the assessment orders for AYs 2003-04 to 2005-06 on the bas....
X X X X Extracts X X X X
X X X X Extracts X X X X
....dingly, it was submitted that the AY 2006-07 becomes the first year of claim considering the losses in all the earlier years as mentioned above and hence it was submitted that the captioned year i.e. AY 2010-11 shall be considered as the 5th year for the purpose of claiming deduction u/s. 80IA and hence, deduction of 100% of the eligible profits ought to be allowed to the assessee t as claimed by in its return of income. 10. The Ld. AR further submitted alternatively that in view of the subsequent appellate and rectification proceedings for AYs 2003-04, 2004-05 and 2005-06, this issue ought to be restored back to the files of the Ld. AO with a direction to give consequential order giving effect to the Tribunal orders to be passed in the assessee's case from AY 2003-04 onwards and accordingly, allow the deduction under section 80-IA of the Act for AY 2006- 07 onwards. 11. The Ld. DR argued that given the fact that the Ld. AO had granted deduction u/s. 80-IA to the Appellant in terms of the Order(s) passed u/s. 143(3) of the Act, then AY 2003-04 ought to be considered as the first year for claim of deduction u/s. 80-IA of the Act, and AY 2010-11 being 8th year of deduction,....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... The issue arising in Ground No. 2, raised in this appeal, pertains to the disallowance of deduction claimed under section 80-IA of the Act on other incomes. 16. At the outset, the Ld. AR submitted that section 80-IA (2A) of the Act begins with a non-obstante clause and the deduction in computing the total income of an undertaking providing telecommunication services, shall be hundred per cent of the profits and gains of the eligible business for the first five assessment years commencing at any time during the periods as specified in sub-section (2) and thereafter, thirty per cent of such profits and gains for further five assessment years. Accordingly, the concept of 'derived from' as appearing in section 80-IA (1) of the Act does not apply in case of an undertaking providing telecommunication services in view of the fact that section 80IA(2A) starts with a non obstante clause treating the same as separate species and hence, all business income of the Company would qualify for deduction under section 80IA of the Act. In this regard, the Ld. AR has placed its reliance on the decision of the Hon'ble Delhi High Court in case of PCIT Vs BSNL Ltd. reported in (2016) 381 ITR 371 (De....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s own case viz. for the AY 2011-12 (ITA No. 9160/Del/2019). * This issue has also been decided in favour by the Tribunal vide Order dated 14 October 2025 in the appellant's group entity case viz. erstwhile Vodafone Digilink Ltd. for the AY 2010-11 (ITA No. 1073/Del/2015). b. Interest income: * During the year under consideration, the assessee earned Interest Income on fixed deposits, interest on loan to group companies, interest on deposit with fixed deposits made with banks for margin money deposit on account of LCs/bank credit/bank guarantee. * This interest income has been earned in the normal course of business. Since the assessee had earned Interest Income on deposits made by it out of funds arising in the normal course of telecom business, the income generated therefrom should be regarded as receipts arising from the provision of telecommunication services and hence eligible for deduction u/s. 80-IA of the Act. * This issue is covered in favour of the assessee by decision of the Mumbai Bench of the Tribunal in its own case ITA No. 9160/Del/2019 for AY 2011-12. * This issue is also covered in favour of the appellant by deci....
X X X X Extracts X X X X
X X X X Extracts X X X X
....4 (Delhi Trib); * Vodafone Digilink Ltd. for the AY 2010-11 (ITA No. 1073/Mum/2015 dated 14 October 2025); * Vodafone West Ltd. for the AY 2010-11 (ITA No. 1634/Ahd/2015 dated 11 December 2025). f. Export incentives: * Income from 'Service from India Scheme' ('SFIS') is in the nature of incentive and the income arising from the same is in the nature of 'Export Incentive' and thus, the same cannot be termed as 'derived from' from the business of undertaking for the purpose of computing deduction u/s 80-IA of the Act. * It is submitted that under the SFIS, services exporters are permitted to use SFIS scripts for import or domestic procurement of capital goods and spares including spares relating to its service sector business. Thus, on receipts of such scripts, the appellant has credited the same to its Profit & Loss A/c. * While this issue has been decided against the appellant by the Tribunal in its own case for AY 2011-12 (ITA 9160/Del/2019), the Tribunal in the case of Vodafone West Ltd. for the AY 2011-12 (ITA No. 443/Ahd/2016) dated 02 April 2026 and Vodafone West Ltd. for the AY 2010-11 (ITA No. 1634/Ahd/2015 dated 11 Decem....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s written back, interest earned on business and margin-money deposits, foreign exchange gain on revenue account, cell-site sharing revenue, bounced-cheque charges, late-payment charges and scrap sale shall be included in the eligible profits. The realised foreign exchange loss on capital account, having been added back by the assessee, shall be dealt with consistently while computing such profits. As regards the remaining components of miscellaneous income, the Ld. AO shall verify their nexus with the eligible business and allow deduction to the extent such nexus is established. However, following the order in the assessee's own case for A.Y. 2011-12, the claim relating to the SFIS/export incentive is not allowable. Ground No. 2 is, therefore, partly allowed for statistical purposes. 21. The issue arising in Ground No. 3,raised in this appeal, pertains to the disallowance made on account of license fees paid by the assessee to the Department of Telecommunication ("DoT"). 22. The brief facts of the case pertaining to this issue, as emanating from the record are: During the year under consideration, the assessee claimed license fees amounting to Rs. 1,43,15,32,083/- paid to....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d. reported in (2023) 458 ITR 593 (SC). During the hearing, the Ld. AR has filed the working of disallowance to an extent of Rs. 32,79,52,230/-in line with the decision of Bharati Hexacom Ltd. (supra). 25. The Ld. AR submitted that the Co-ordinate Bench of the Tribunal in the assessee's own case for the A.Ys. 2015-16, 2011-12, 2012-13 & 2013-14, after considering the decision of the Hon'ble Supreme Court in CIT vs. Bharati Hexacom Ltd., (supra) has directed the Ld. AO to verify the workings furnished by the assessee and compute the quantum of disallowance/ allowance as per the decision of the Supreme Court in the case of Bharti Hexacom (supra). 26. The relevant extract from the Order dated 30 June 2026 passed in the assessee's own case for the A.Y. 2015-16 is reproduced below: "......... Ground No. 10 and its sub-grounds relate to the disallowance of licence fee claimed as revenue expenditure under section 37(1) of the Act by treating the same as capital expenditure eligible for amortisation under section 35ABB of the Act. 12.1. The Ld. AR submitted that though the issue regarding the nature of annual licence fee now stands concluded by the judgment of the H....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... have perused the submissions advanced by both sides in light of the record placed before us. We find that the controversy regarding the allowability of annual licence fee is no longer res integra. The Hon'ble Supreme Court in Bharti Hexacom Ltd. (supra) has categorically held that the annual licence fee payable under the New Telecom Policy is capital in nature and is not allowable as revenue expenditure under section 37(1) of the Act, the deduction being governed by the provisions of section 35ABB of the Act. In view of the aforesaid binding decision, we uphold the action of the lower authorities in disallowing the assessee's claim of deduction under section 37(1) of the Act. 12.5. However, we find merit in the alternate plea advanced by the assessee that the consequential deduction admissible under section 35ABB requires fresh computation after considering the amalgamation of various group entities, transfer and cancellation of telecom licences and the surviving licence period, as explained in Appendix-C placed before us. The detailed working furnished by the assessee demonstrates that the effect of mergers and transfer of licences has a direct bearing on the per....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... At the same time, the assessee's year-specific working for consequential amortisation requires verification. Consistent with the orders of the Coordinate Benches in the assessee's own cases, we restore the matter to the file of the Ld. AO for the limited purpose of verifying the working furnished by the assessee and allowing the consequential deduction u/s. 35ABB in accordance with law, after affording reasonable opportunity of being heard. Ground No. 3 is partly allowed for statistical purposes. 28. The issue arising in Ground No. 4 raised in the appeal pertains to disallowance of depreciation claimed on the addition to fixed assets on account of Asset Restoration Cost ('ARC') obligation. 29. The brief facts of the case pertaining to this issue are that the assessee entered into lease agreements with various owners of premises for setting up of cell sites (telecom towers) on the said premises. These lease agreements cast an obligation on the assessee to restore the leased premises to their original form at the time of vacating the same. The aforesaid asset reconstruction cost ('ARC') is the estimated cost to be incurred at the leased and shared network sites and of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lternate plea seeking deduction of the Asset Restoration Cost as revenue expenditure under section 37(1) of the Act. 9.1. The Ld. AR submitted that the authorities below erred in disallowing depreciation on the Asset Restoration Cost capitalised by the assessee as part of the cost of the relevant assets. Without prejudice, it was contended that even if the capitalization of the Asset Restoration Cost is not accepted, the entire expenditure ought to be allowed as a deduction under section 37(1) of the Act, being wholly and exclusively incurred for the purposes of the business. It was submitted that the issue relating to depreciation on Asset Restoration Cost stood decided against the assessee by the Coordinate Bench in the case of the erstwhile Vodafone Digilink Ltd. for A.Y. 2010-11in DCIT v. Erstwhile Vodafone Digilink Ltd. [2018] 92 taxmann.com 250 (NCLT - New Delhi). However, it was pointed out that, in further appeal, the Hon'ble Delhi High Court vide judgment dated 11.03.2025, reported in Vodafone Mobile Services Ltd. v. Dy. CIT [2025] 172 taxmann.com 368/304 Taxman 285 (Delhi), while affirming the disallowance of depreciation, accepted the assessee's alternat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ction 37(1) of the Act. Accordingly, Ground No. 7 is partly allowed in terms indicated hereinabove." 33. We have perused the submissions advanced by both sides in light of the record placed before us. The Hon'ble Delhi High Court in Vodafone Mobile Services Ltd. v. Dy. CIT reported in (2025) 172 taxmann.com 368 (Delhi) has upheld the disallowance of depreciation on Asset Restoration Cost while accepting the alternate claim that the expenditure is allowable u/s. 37(1). Respectfully following the binding judgment and the orders in the assessee's own cases, we uphold the disallowance of depreciation. The Ld. AO is, however, directed to allow the alternate claim of Asset Restoration Cost as revenue expenditure u/s. 37(1), after verifying the year-specific quantum and ensuring that no double deduction is granted. Ground No. 4 is partly allowed in the aforesaid terms. 34. The issue arising in Ground No. 5,raised in this appeal, pertains to the disallowance made domestic roaming charges paid to other telecom operators on account of non-deduction of TDS. 35. The brief facts of the case pertaining to this issue, as emanating from the record are: During the assessment pro....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ents are made to other telecom operators to enable subscribers of the assessee to make or receive calls originating/terminating on other telephone networks. Roaming service is in the nature of automated services and no human intervention for switch over to the network of other telecom operators while in roaming is warranted. The Assessing Officer made disallowance u/s. 40(a)(ia) of the Act on the pretext that the provisions of section 194C and/or section 194] of the Act are attracted on payments made to other telecom operators. The Id. Counsel for the assessee submitted that the issue is squarely covered by the decision of Kolkata Bench of the Tribunal in the case of Vodafone East Ltd. vs. Addl. CIT, 156 ITD 337. 18 M/s. Vodafone India Ltd. 28. The Id. Departmental Representative vehemently placed reliance on the assessment order and the observations of DRP on the issue and prays for dismissing ground No.9 of the appeal. 29. We have heard the submissions made by rival sides and have examined the orders of authorities below. One of the issue before Kolkata Bench of Tribunal in the case of Vodafone East Ltd. vs. ACIT (supra) was with respect to deduction of tax at s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ount extended to pre-paid distributors under section 40(a)(ia) of the Act. 39. The Ld. AO held that the assessee is liable to deduct tax u/s. 194H on the discount extended to the pre-paid distributors on recharge coupons. While doing so, the AO has relied on the decisions of the Delhi High Court in the case of CIT v/s. Idea Cellular Ltd. (2010) 325 ITR 148 (Delhi) and Kerala High Court in the case of Vodafone Essar Cellular Ltd. v/s. CIT (2010) 332 ITR 255 (Kerala). The DRP relying on its own directions for the earlier years upheld this disallowance. 40. The ld AR submitted that this issue is no longer res integra as this issue has been decided by the Apex Court in favour of the taxpayer in the case of Bharti Cellular Ltd. v/s. ACIT reported in (2024) 160 taxmann.com 12 (SC) wherein it has been held that the assessee is not required to deduct tax at source on the discount extended to prepaid distributors. It was also submitted that this issue has been decided in favour of the assessee in its own case and relied on the following decisions: * Order dated 30 June 2026 for the A.Y. 2015-16 (ITA No. 8971/Del/2019); * Order dated 11 May 2026 for the A.Y. 2011-12 (....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nds is allowed." 42. We have perused the submissions advanced by both sides in light of the record placed before us. The controversy stands concluded by the judgment of the Hon'ble Supreme Court in Bharti Cellular Ltd. v. ACIT (2024) 160 taxmann.com 12 (SC), holding that the discount extended to prepaid distributors does not constitute commission within the meaning of section 194H. The same view has consistently been followed in the assessee's own cases. The Revenue has not pointed out any distinguishing fact or change in law. We, therefore, direct the Ld. AO to delete the disallowance made u/s. 40(a)(ia). Ground No. 6 is allowed. 43. The issue arising in Ground No. 7, raised in this appeal, pertains to the disallowance made under section 14A of the Act. 44. The brief facts of the case pertaining to this issue, as emanating from the record are: During the assessment proceedings, it was noted that the assessee has an investment in shares of a group company, which stands at Rs. 2782 million, however the assessee has not disallowed any expenditure incurred for earning exempt income under section 14A of the Act read with Rule 8D of the Income Tax Rules, 1962 ("the R....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gly, the disallowance of Rs. 92,75,000/- is directed to be deleted and Ground No. 3 raised by the assessee is allowed" 49. The Ld. AR also submitted that the issue is also decided in favour of the assessee in the following cases: * Order dated 11 December 2025 in case of erstwhile Vodafone West Ltd. for the AY 2010-11 (ITA No. 671/Ahd/2015) * Order dated 17 November 2016 in case of erstwhile Vodafone West Ltd. for the AY 2009-10 (ITA No. 909/Ahd/2014) * Consolidated Order dated 17 May 2024 in the case of erstwhile 'Vodafone India Limited' in ITA No. 884/Mum/2016 and 2834/Mum/2017 for AY 2011-12 and 2012-13] * Order dated 08 November 2023 in the case of erstwhile Vodafone India Limited in ITA No 1121/Mum/2014 for AY 2009- 10. * CIT v/s. Chettinad Logistics (P.) Ltd. reported in [2017] 248 Taxman 55 (Mad.) [SLP dismissed - CIT v/s. Chettinad Logistics (P.) Ltd. reported in (2018) 95 taxmann.com 250 (SC)] * CIT v/s. GVK Project and Technical Services Ltd [2019] reported in 106 taxmann.com 180 (Delhi) [SLP dismissed - PCIT v/s. GVK Project and Technical Services Ltd reported in [2019] 106 taxmann.com 181 (SC)] * PCIT v/s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ib.); * DCIT v/s. Erstwhile Vodafone Digilink Ltd. (2018) 193 TTJ 150 (Delhi Trib.); and * DCIT v/s. Erstwhile Vodafone India Ltd. (ITA No. 1919/Mum/2016 dated 17 May 2024). 54. The relevant extract from the Order dated 30 June 2026 passed in the assessee's own case for the A.Y. 2015-16 is reproduced below: ".... Ground No. 6 along with its sub-grounds relates to the disallowance of penalty paid by the assessee to the Department of Telecommunication (DoT). 8.1. The Ld. AR submitted that the authorities below erred in treating the amount paid by the assessee to the Department of Telecommunication as penal in nature and consequently disallowing the same. It was contended that the payment was compensatory and incidental to the carrying on of the assessee's telecom business and did not represent any expenditure incurred for an offence or for any act prohibited by law. The Ld. AR submitted that the issue is no longer res integra and stands concluded in favour of the assessee by the decisions of the Coordinate Benches in the assessee's own cases. 8.2. Reliance was placed on the orders of the Tribunal in the assessee's own case f....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion has undergone any change. Judicial propriety, therefore, requires us to follow the consistent view adopted by the Coordinate Benches. 8.6. Respectfully following the decisions of the Coordinate Benches in the assessee's own case for A.Ys. 2012-13 and 2013-14 in ITA Nos. 8361/Del/2019 and 8362/Del/2019, as consistently followed in the subsequent decisions referred to hereinabove, we direct the Ld. AO to delete the disallowance made in respect of the penalty paid to the Department of Telecommunication. Accordingly, Ground No. 6 along with all its sub-grounds is allowed." 55. We have perused the submissions advanced by both sides in light of the record placed before us. The Coordinate Benches, after examining identical payments made to the DoT, have consistently held that the charges arise from the contractual terms of the telecom licence and are compensatory in character, rather than expenditure incurred for an offence or an act prohibited by law. The Revenue has not brought any distinguishing material on record. Respectfully following the consistent view taken in the assessee's own cases, we direct the Ld. AO to delete the impugned disallowance. Accordingly, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....afone Digi link Ltd. for AY 2010-11 before the Tribunal in ITA No.1073/DEL/2015 and ITA No.1158/DEL/2015 (supra). The relevant part of the decision is reproduced below for ready reference and clarity: "17.1. Ground No. 7 raised by the Revenue pertains to disallowance of Network Site Rentals. We have heard both the sides on this issue and have perused the material on record. .............. 17.4. In this regard, we note that the Assessee had made following submission in this regard before the Assessing Officer vide 23/01/2015. "Crystallisation of Site Network Charges: * At the outset, we wish to submit that out of the total network site expenses of Rs 396.25 crores debited to the profit and loss account of VDL during the subject AY, a significant portion pertains to charges paid to Indus, which should have in fact been disallowed by your office instead of disallowing the entire expense as appearing in the books. * Without prejudice to the above, as regards the issue of crystallization/ accrual of network site charges amounting of Rs 396.25 crores, we wish to submit that the very fact that the same are appearing under schedule 13 of the aud....
X X X X Extracts X X X X
X X X X Extracts X X X X
....irected the Assessing Officer to implement the directions given by the DRP, the Assessee is granted liberty to place before the Assessing Officer such supporting documents/details as the Assessee may deem fit to establish crystallization of expenses during the relevant previous year. In terms of aforesaid, Ground No.7 raised by the Assessee is allowed for statistical purposes." 18.3 Since the facts are similar, following the above decision, the matter is set aside to the file of AO for fresh consideration in the light of the documents and evidences as to whether the expenses have crystalized during the year. If the expenses have crystalized, the AO shall grant the deduction to such extent as claimed by the assessee. This ground is allowed for statistical purpose." 61. We have perused the submissions advanced by both sides in light of the record placed before us. The DRP had directed allowance of the networksite rental expenditure upon verification of its crystallisation, whereas the Ld. AO sustained the disallowance for want of substantiation. The assessee has placed on record the certificate issued by Indus, the indicative site list and the governing Master Se....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ments pertaining to related party transactions and no interest free loans were provided by the assessee to any of its group entities. Pursuant to the DRP Directions, the assessee in response to the notice issued by the AO, submitted details w.r.t. interest income earned from VSPL vide letter dated 23 January 2015 (page Nos. 369 to 372 of the paperbook - Volume 1). Accordingly, it was argued that the said disallowance ought to be deleted while computing the total income of the captioned year. Reliance was also placed on the decision of the Hon'ble Bench in the assessee's own case for AY 1990-2000 (ITA No. 1752/Mds/2004) wherein it has been held that where there are mixed funds and funds available with the assessee are much more than the advances made no disallowance can be made on account of notional interest computed by Assessing Officer. It was also held that the amount has been advanced to its sister concern/ subsidiary, which are doing business and it has been clearly stated that the same has been advanced for commercial expediency, therefore, in view of the decision of the Apex Court in the case of SA Builders Ltd. v/s. CIT 288 ITR 1 (SC), no disallowance is to be made. 67. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....A(3) of the Act, rejected the comparable instances selected by the assessee by adopting CUP as the most appropriate method. The TPO alleged that none of the comparable selected by the assessee are comparable in true sense and the search conducted by the assessee has not yielded correct results and concluded the ALP of payment of royalty to be Nil. 71. The DRP relying on its directions for the earlier year sustained the transfer pricing adjustment made by the TPO. Inconformity, the Ld. AO, interalia, passed the impugned Final Assessment Order on this issue. 72. The Ld AR submitted that issue is covered in favour of the assessee by the decision of the Co-ordinate Bench of the Tribunal in the assessee's group company's case viz. erstwhile Vodafone Digilink Ltd. for the AY 2009-10.The Coordinate Bench of the Tribunal, while considering the transfer pricing adjustment in respect of similar royalty payment made by the assessee for the AY 2009-10, observed as follows: "................Alternatively, the mean arm's length royalty rate of 5.20%, derived from external CUP agreements through a fresh search, is also treated as an appropriate ALP. Respectfully reliance i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....os. 11.5 to 11.10), the brief facts of the case pertaining to this issue, as emanating from the records, are: The assessee incurred certain distribution and advertisement/sales promotion during the year as part of its roles and responsibilities as a service provider. 77. The TPO has determined that said expenses are in the nature of advertisement, marketing and promotion ('AMP') expenditure which is incurred on behalf of the AEs and thus considered it as a separate reimbursement transaction. The TPO also applied the 'bright line limit' while holding that the AMP expenses incurred by the assessee are excessive. 78. The Ld. DRP, following directions of the previous year, rejected the objections raised by the assessee on this issue. In conformity, the Ld.AO, interalia, passed the impugned Final Assessment Order on this issue. 79. The Ld AR submitted that issue is covered in favour of the assessee by the following decisions: * Delhi High Court in the case of CIT v/s. Whirlpool of India Ltd. (2016) 381 ITR 154 (Delhi) * Delhi High Court in the case of Maruti Suzuki India Ltd. v/s. CIT (2016) 381 ITR 117 (Delhi) 80. It was also submitted by the ld AR that th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....incurred by the assessee are excessive. The TPO also applied a mark-up of 15.46% on the assessee's alleged excessive AMP expenses. 11.3. The DRP vide its directions dated 18/12/2013, relying on the decision of the Special Bench of the Tribunal in the case of LG Electronics India Pvt. Ltd. vs. ACIT (2013) 140 ITD 41 (Delhi) (SB), upheld the applicability of the bight line test while computing the ALP of the AMP expenditure. It further upheld the TPO's stand of adding a markup of 15.46% on the ALP of the AMP expenditure. Pursuant to the DRP Directions, the Ld. AO in terms of the Final Assessment Order dated 30/01/2014 inter-alia made an addition of Rs. 2,84,68,27,994/- to the income of the assessee being the transfer pricing adjustment made by the TPO on the transaction of AMP expenditure. 11.4. Mr. Pardiwalla submits that the revenue has not discharged the onus cast on it by bringing any material on record to prove that there is an understanding / arrangement or an action in concert between the assessee and the AEs for promotion of trademark/trade name owned by the AEs. The AMP expenses have been incurred as a function as part of the assessee's roles an....
X X X X Extracts X X X X
X X X X Extracts X X X X
....expenditure. The facts of the aforesaid case before the Bench are detailed in para Nos. 12.4 to 12.5 on page Nos. 40 to 42 of its Order, the said findings are extracted hereunder for ready reference: ......12.4. We have considered the rival submission and perused the material on record including the chart of issues filed by the Assessee. 12.5. We note that in the present case the TPO has arrived at a conclusion that there existed international transaction solely on the basis of the fact that the Assessee has incurred high AMP Expenditure at the rate of 6.2% of sales. While AMP Expenses may constitute an International transaction, the existence of an arrangement and consequently, an international transaction cannot be presumed on the basis of bright line test only. In the case of Maruti Suzuki India Limited Vs Commissioner of Income Tax: [2016] 381 ITR 117 (Delhi) it has been held by the Hon'ble Delhi High Court that the existence of AMP Expenditure, being an international transaction, will have to be established de hors the bright line test. In absence of any written agreement, whether any arrangement existed or the Assessee along with its AE acted in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....refore any existence of any international transaction of AMP is not established. The Ld. Counsel further submits that adoption of bright line test for holding the excessive AMP expenses compared to the third party comparables is erroneous as the TPO has not established functional similarities between the appellant and the comparables chosen by him for the application of bright line method. Further, the Ld. Counsel submits that the AMP issue is already covered in its favor by the decision of the Hon'ble Mumbai ITAT in the case of Vodafone India Ltd. in ITA No.884/Mum/2016 dated 17.05.2024. In this regard, I rely on the order of the Transfer Pricing Officer and of the Ld. DRP wherein the TPO has discussed elaborately the details of the AMP transaction and the reasons for holding it as an international transaction and benchmarking it by adopting the most appropriate method." 11.9. This issue too, as was argued during the course of the hearing, has been addressed by the Hon'ble Delhi High Court in the case of Maruti Suzuki India Limited (supra) relevant portion of the same is extracted hereunder for ready reference: "73. ..... The ar....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ransaction in the absence of evidence. The Hon'ble Supreme Court's dismissal of the revenue's SLP further reinforces this position. The AMP expenses incurred by the assessee were essential to its business functions as a telecom service provider and were aimed at expanding its subscriber base, not at promoting the brand of its AEs. These expenses were inextricably linked to the assessee's business operations and cannot be arbitrarily segregated as brand promotion for the AEs. The TPO's characterization of the assessee as a mere distributor, without any substantive reasoning, contradicts the assessee's established role as a full-fledged telecom service provider. The business model chosen by the assessee is to be respected, as per settled jurisprudence, and cannot be recharacterized arbitrarily by the revenue. The application of the bright line test without ensuring functional comparability of the selected comparable and without considering business-specific factors renders the adjustment methodologically flawed. In subsequent assessment years, no adverse inference has been drawn, and no transfer pricing adjustments have been made concerning AMP expenses. This ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... squarely covered by the orders in the assessee's own and group cases referred to hereinabove. We, therefore, direct the Ld. AO/TPO to delete the transfer-pricing adjustment of Rs. 65,59,94,739/-. Ground Nos. 11.5 to 11.10 are allowed. 83. The issue arising in Ground No. 12 pertains to short grant of credit for TDS. 84. The Ld. AO is directed to verify the assessee's claim for TDS credit with reference to the certificates and the corresponding income offered to tax and to grant due credit in accordance with section 199 read with Rule 37BA. The assessee shall be afforded reasonable opportunity to furnish the requisite details. Accordingly, Ground No. 12 is allowed for statistical purposes. 85. The issue arising in Ground No. 13 pertains to erroneous levy of interest u/s. 234B and 234C of the Act. 86. The levy of interest u/s. 234B and u/s. 234C is mandatory and consequential in nature. The Ld. AO shall recompute the same, if any, while giving effect to this order in accordance with law. Accordingly, Ground No. 13 does not require separate adjudication. 87. The issue arising in Ground No. 14 pertains to non-grant of minimum alternative Tax ('MAT') cred....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e find that the DRP had followed the decision of the Tribunal in the case of the Assessee for the immediate preceding Assessment Year 2009-2010 [ITA No. 1950/Del/2014, dated 14/03/2018] (Supra). We have perused the aforesaid decision of the Tribunal and we find that in identical facts and circumstances, the ad-hoc disallowance of 10% of commission paid to agents proposed by the Assessing Officer for the Assessment Year 2009- 2010 was not accepted by the DRP and the DRP had allowed the objection raised by the Assessee by following the decision of Tribunal in the case of Vodafone Mobile Services Ltd. (a sister concern of the Assessee) for the Assessment Years 2000-2001 to 2008-2009 whereby similar disallowances were deleted by the Tribunal. The relevant extract of the decision of the Co-ordinate Tribunal passed in the case of the Assessee for the Assessment Year 2009-2010 [ITA No.1950/Del/2014, dated 14/03/2018] (Supra) reads as under: "3. First ground of the Revenue's appeal is against the deletion of addition of Rs. 14,23,29,976/-on account of commission 4. Briefly stated, the facts of the case are that the assessee is engaged in the business of providing cell....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d order in deleting the disallowance of commission amounting to Rs. 14.23 crore." 3.6. The Revenue has failed to bring any material on record to distinguish the above decision of the Tribunal either on facts or in law. Therefore, respectfully following the above decision of the Tribunal, we decline to interfere with the directions issued by the DRP and the Final Assessment Order passed by the Assessing Officer on this issue. Accordingly, Ground No. I raised by the Revenue is dismissed." 34.1 The facts of the instant appeal are similar. The revenue has not been able to bring on record anything contrary, either on fact or on law. Hence, following the above decision, the ground of revenue is dismissed." 93. The Ld. AR also submitted that this issue is also decided in favour of the assessee in the following group company's cases: * Vodafone Digilink Ltd. for AY 2010-11 * Vodafone Digilink Ltd. for AY 2009-10 94. We have perused the submissions advanced by both sides in light of the record placed before us. The Ld. AO made an ad hoc disallowance of 10% despite the assessee having furnished the particulars of the major distributors and the corres....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n case for Assessment Years 2011-12 in ITA No. 1042/Del/2016 vide order dated 11/05/2026, Assessment Year 2012-13 in ITA No. 8361/Del/2019 vide order dated 24/10/2025 and Assessment Year 2013- 14 in ITA No. 8362/Del/2019 vide order dated 18/03/2026. We further note that an identical issue has also been decided in favour of the assessee's group concern, Vodafone West Ltd., for Assessment Year 2011-12 vide order dated 02/04/2026. In the aforesaid decisions, after considering the judgment of the Hon'ble Delhi High Court in CIT v. Fascel Ltd. (2009) 221 CTR 305 (Del.), it has consistently been held that the royalty/WPC charges paid to the Department of Telecommunications are revenue expenditure allowable under section 37(1) of the Act. The Revenue has not brought on record any distinguishing feature in facts or any change in law warranting a different view for the year under consideration. Respectfully following the aforesaid decisions, we direct the Ld. AO to delete the impugned disallowance. Accordingly, Ground No. 12 and its sub-grounds are allowed." 99. Also, similar issue has been decided by the Tribunal in favour of the assessee's group company viz. Vodafone West Ltd f....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 5.4. We have heard the rival submissions and perused the material on record on this issue. It emerges that identical issue had come up for consideration before the Delhi Bench of the Tribunal in the Assessee for the immediate preceding Assessment Year 2009-2010 [ITA Nos.1169&1950/Del/2014, dated 14/03/2018, titled Deputy Commissioner of Income Tax, Circle-17(1), New Delhi vs Vodafone Essar Digilink Ltd. reported in [2018] 92 taxmann.com 234 (Delhi)). Dismissing identical ground raised by the Revenue, the Co-ordinate Bench of the Tribunal held as under: "9 Ground No. 3 of the Revenue's appeal is against the deletion of addition of Rs. 2,52,28,036/ on account of 'Advertisement expenses. The assessee claimed deduction for advertisement expenses amounting to Rs. 97.63 lac on product launches and Rs. 14.81 crore on granty signs. The AO opined that since the benefit of this expenditure would be reaped in subsequent years as well, he treated the said amount of advertisement expenses as capital. After allowing deduction @ 25%, he made an addition of Rs. 2,52,28,03,617/- The DRP got convinced with the assessee's submissions and ordered to delete the addition. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ell as from interest free funds and is for the purpose of assisting the assessee in carrying on its existing operations and not for the purpose of extension of its business. The Ld. AO vide draft assessment order proposed an addition of approx. 7.7% on the monthly closing balance of the CWIP amounting to Rs. 3,75,59,529/-. 107. The DRP relied on case of Madhav Prasad Jatia v. CIT (1979) 118 ITR 200 (SC), wherein the Apex Court has held that the expression "for the purpose of business" occurring in section 36(1)(iii) is wider in scope than the expression "for the purpose of making or earning income". The Hon'ble Court has also laid down the basic requirements for claiming deduction u/s 36(1)(iii), as below: a) The money i.e. capital must have been borrowed by the assessee. b) It must have been borrowed by the assessee for his business, profession or vocation and c) The assessee must have paid interest on the amount and claimed it as an allowance. Further, the DRP also relied on case of Banarsi Das Gupta v. CIT (1977) 106 ITR 559 (All), wherein it has been held that the purpose may be to acquire a capital asset or stock in trade, as also to pay off a ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e same is used for business purposes irrespective of the result of use of such capital. We afforded ample rebuttal opportunity to Revenue. Ld. Departmental Representative fails to take us to any material in the case file so as to prove that assessee's interest in question is covered u/s. 36(1)(iii) proviso as amended by the Finance Act, 2015 w.e.f. 01.04.2016 since it is a case wherein the impugned interest is in respect of capital borrowed for the purpose of business already attracting the main limb of statutory provision instead of the above proviso. This Revenue's ground is accordingly declined." 79. In the absence of any allegation in change of facts or law in the year under consideration, respectfully following the decision of the Co-ordinate Bench of the Tribunal cited supra, the impugned order on this issue is upheld, and Ground No. 12 raised in Revenue's appeal is dismissed." 111. We have perused the submissions advanced by both sides in light of the record placed before us. The DRP recorded a factual finding that the investment in CWIP represented regular network assets acquired in the course of the assessee's existing telecommunication business and not....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... made an addition. The DRP directed to delete the addition 12 Having heard both the sides and perused the relevant material on record, we find that the deduction of Rs. 31 lac is not on account of embezzlement by employees, but, for the loss incurred due to frauds committed by the assessee's customers who did not make payments for the bills raised on them by the assessee. This loss, being incidental to carrying on business, cannot be treated as an item of non-revenue nature. We, therefore, uphold the impugned order in deleting the disallowance. This ground is dismissed." (Emphasis Supplied) From the above it is clear that the deduction claimed by the Assessee was allowed by the Tribunal observing that the loss incurred by the Assessee on account of frauds committed by the customers and/or non-payment by the customers was incidental to running business. Therefore, deduction for the same was allowable under Section 37(1) of the Act. 7.3. Respectfully following the above decision of the Tribunal, we decline to interfere with the Final Assessment Order passed by the Assessing Officer as per directions issued by the DRP on this issue whereby identical loss of INR.3....
X X X X Extracts X X X X
X X X X Extracts X X X X
....amount of Rs. 168.83 crores from the WDV, an additional amount of Rs. 47.80 crores (i.e. 216.63 less 168.83 crores) should be reduced from the WDV thereby resulting in disallowance of depreciation of Rs. 7.17 crores (i.e. 15% of 47.80 crores). 119. The Ld. AR submitted that the Scheme of Demerger in terms of the PI assets were transferred to VInFL without any consideration has been approved by the Delhi High Court. In the absence of any consideration, the AO cannot impute sales consideration and reduce the same from the WDV of depreciable assets. The aspect of the aforesaid transaction as 'gift' has been confirmed by the Gujarat High Court in the case of Respondent's group Company viz. erstwhile Vodafone West Ltd. wherein a similar scheme has been filed which has been approved by the Gujarat High Court. 120. It was also submitted that no deduction of the loss arising from the transfer of PI assets to VInFL was claimed by the assessee. Even though in the absence of any sale consideration where the assessee was not required to adjust its WDV, it has suo-moto reduced the tax WDV of such PI assets from its Plant and Machinery block. Thus, as correctly held by the DRP, it cannot b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ever, section 47(iii) of the Act provides that any transfer of a capital asset under a will or an irrevocable trust or as gift will not be regarded as a transfer. In the instant case. the transaction under reference is by way of gift duly approved by the High Court & hence a legitimate transaction and the Act itself recognizes such Gift by corporate. Further, clause 40 of the Memorandum of Association specifically permits the assessee to grant gift to any person. This is in consonance with the decision of Hon'ble Supreme Court in the case of LaksmanswamiMudaliar V. L.I.C (33 Com Cases 420), where it was observed that a company can make a gift provided that the Memorandum of Association/Charter documents of the company permit such a transaction. Further, the fact that the transaction in the present case is in the nature of gift has been affirmed by the Hon'ble Delhi High Court while approving such scheme, where the Hon'ble Court has observed as below. "45. For all of the above reasons, and since the objector has not been able to place any direct authority, precedent or Rule before this Court to support his contention, and in view of the authorities relied on by ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e DRP. The Scheme of Demerger which clearly provided that the Assessee shall gift PI Assets to Vodafone Infrastructure Ltd.. Before the Hon'ble Delhi High Court the Revenue had filed objection to the Scheme of Demerger contending, inter alla, that a transfer by way of gift was not permissible under Section 391 of the Companies Act, 1956. However, the aforesaid objection was rejected by the Hon'ble Delhi High Court observing that the Revenue had failed to place any direct authority, precedent or Rule before the Hon'ble Court in support its contention. The aforesaid was taken note of by the DRP while allowing the objections raised by the Assessee. Therefore, we concur with the view taken by the DRP that the transaction of transfer of PI Assets by the Assessee to Vodafone Infrastructure Ltd as gift cannot be regarded as sham transaction having been accepted and approved by the Hon'ble Delhi High Court as part of the Scheme of Demerger after due consideration of the objections raised by the Revenue. DRP has correctly concluded that transaction of transfer of PI Assets by the Assessee to Vodafone Infrastructure Ltd qualified as 'gift' and the same could not be re....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 128. The issue arising in Ground No. 2 pertains to treating of interest income from deposits as income under the head 'other sources. 129. The brief facts of the case, pertaining to this issue, as emanating from the record, are: During the assessment proceedings, the assessee had earned interest income of Rs. 2,57,61,120/- which was credited to the Profit & Loss Account and offered to tax under the head "Profits and Gains of Business or Profession". The said interest arose from fixed deposits and other deposits maintained either out of business funds generated from telecom operations or as margin money/security deposits placed with banks and financial institutions for availing credit facilities, bank guarantees and other financing arrangements in the ordinary course of business. 130. The Ld. AR submitted that since these deposits were in extricably linked with and formed an integral part of the assessee's business operations and financing structure, the interest income constituted business income. However, the AO assessed the same under the head "Income from Other Sources", denied the benefit of netting off against interest expenditure, and consequently reduced the p....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rd, are: During the course of the appellate proceedings, the CIT(A) raised additional queries with respect to applicability of provisions of Section 14A of the Act to the assessee which are neither a subject matter of appeal nor apparent from the assessment records. 141. The Ld. AR submitted that section 251 of the Act empowers the Commissioner of Income-tax (Appeals) to confirm, reduce, enhance or annul assessment. However, the power enshrined in the aforesaid section is not boundless power and has to be read with certain limitations. The same is evident from the plain reading of Section 251 of the Act, which provides that the appellate proceedings will be restricted to the matters arising from the assessment proceedings. Hence, roving enquiries or discovering new source of income / disallowance, which are not a subject matter of the assessment proceedings cannot be made part of the appellate proceedings. 142. The Ld. AR also submitted that in any case, the issue of disallowance under section 14A of the Act on which the Ld. CIT(A) has made enhancement on merits, is identical to the Ground no. 7 of the assessee's appeal for A.Y. 2010-11 (ITA No. 1021/Del/2015). 143. If the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er the head 'other sources'. 155. This Ground of appeal is identical to Ground No. 2 of the assessee's appeal for A.Y. 2003-04 (ITA No. 4216/Del/2013). 156. The issue is identical to Ground No. 2 of the assessee's appeal for A.Y. 2003-04, adjudicated at para 132 hereinabove. Our findings and directions therein shall apply mutatis mutandis. Ground No. 2 is allowed. 157. The issue arising in Ground No. 3 pertains to deduction under section 80- IA of the Act 158. This ground of appeal is identical to Ground No. 1 of the assessee's appeal for A.Y. 2010-11 (ITA No. 1021/Del/2015). 159. This issue stands adjudicated at para 14 hereinabove while deciding Ground No. 1 of the assessee's appeal for A.Y. 2010-11. The findings and directions contained therein shall apply mutatis mutandis to the year under consideration, and the Ld. AO shall give consequential effect after determining the subsisting assessed income and the deduction, if any, actually admissible. Ground No. 3 is allowed for statistical purposes. 160. The issue arising in Ground No. 4 pertains to deduction under section 80- IA of the Act on other income. 161. This Ground of appeal is identical to G....
X X X X Extracts X X X X
X X X X Extracts X X X X
....law. Ground No. 1 is partly allowed for statistical purposes. 175. The issue arising in ground No. 2 pertains to treating interest income as income under the head 'other sources'. 176. This ground of appeal is identical to ground no. 2 of the Appellant's appeal for A.Y. 2003-04 (ITA No. 4216/Del/2013). 177. The issue is identical to Ground No. 2 of the assessee's appeal for A.Y. 2003-04, adjudicated at para 132 hereinabove. Our findings and directions therein shall apply mutatis mutandis. Ground No. 2 is allowed. 178. The issue arising in ground No. 3 pertains to Disallowance of depreciation on provision for asset restoration cost ('ARC') obligation. 179. This ground of appeal is identical to ground no. 4 of the Appellant's appeal for A.Y. 2010-11 (ITA No. 1021/Del/2015). 180. The issue is identical to Ground No. 4 of the assessee's appeal for A.Y. 2010-11, adjudicated at para 33 hereinabove. Our findings and directions therein shall apply mutatis mutandis. Ground No. 3 is partly allowed in the terms indicated therein. 181. The issue arising in ground No. 4 pertains to deduction under section 80- IA of the Act. 182. This ground of appeal is identical....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tical to Ground No. 7 of the assessee's appeal for A.Y. 2010-11, adjudicated at para 50 hereinabove. Our findings therein shall apply mutatis mutandis. The disallowance made u/s. 14A is directed to be deleted. Ground No. 8 is allowed. 196. The issue arising in ground No. 9 pertains to initiation of penalty proceedings u/s. 271(1)(c) of the Act. 197. The ground challenging initiation of penalty proceedings u/s. 271(1)(c) is premature at this stage and does not call for adjudication in the quantum appeal. Ground No. 9 is dismissed as premature. Assessee's appeal, ITA No. 4223/Del/2013 (A.Y. 2006-07): 198. The issue arising in Ground No. 1 pertains to disallowance of license fees u/s 37(1) of the Act. 199. This Ground of appeal is identical to Ground No. 3 of the assessee's appeal for A.Y. 2010-11 (ITA No. 1021/Del/2015). 200. The Ld. AR has also furnished the working of disallowance to an extent of Rs. 55,89,81,822/-in line with the decision of Bharati Hexacom Ltd. (supra). 201. The issue is identical to Ground No. 3 of the assessee's appeal for A.Y. 2010-11, adjudicated at para 27 hereinabove. Our findings and directions therein shall apply mutatis mutan....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e above, if the said amount is held as taxable as arising during the course of its business, then the same should be considered while computing eligible profits for the purpose of claiming deduction u/s. 80-IA of the Act. 210. We have perused the submissions advanced by both sides in light of the record placed before us. The customer security deposits were refundable amounts received as security against outstanding dues and were capital receipts at inception. No deduction in respect of the principal amount was claimed or allowed in any earlier year. Their unilateral write-back, therefore, does not attract section 41(1), nor does it alter the original character of the receipts merely because the customers did not claim repayment. The Revenue has not brought any material to show that the deposits were appropriated as trading receipts at the time of receipt. Respectfully following CIT v. Mahindra & Mahindra Ltd. (2018) 404 ITR 1 (SC) and the other decisions cited hereinabove, we direct the Ld. AO to delete the addition of Rs. 1,34,31,635/-. The alternate claim u/s. 80-IA consequently becomes academic. Ground No. 3 is allowed. 211. The issue arising in Ground No. 4 pertains to di....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ted at para 37 hereinabove. Our findings therein shall apply mutatis mutandis. The disallowance made u/s. 40(a)(ia) in respect of domestic roaming charges is directed to be deleted. Ground No. 7 is allowed. 224. The issue arising in Ground No. 8 pertains to disallowance under section 14A of the Act. 225. This Ground of appeal is identical to Ground No. 7 of the assessee's appeal for A.Y. 2010-11 (ITA No. 1021/Del/2015). 226. The issue is identical to Ground No. 7 of the assessee's appeal for A.Y. 2010-11, adjudicated at para 50 hereinabove. Our findings therein shall apply mutatis mutandis. The disallowance made u/s. 14A is directed to be deleted. Ground No. 8 is allowed. 227. The issue arising in Ground No. 9 pertains to interest under section 234B of the Act. 228. The levy of interest u/s. 234B is mandatory and consequential in nature. The Ld. AO shall recompute the same, if any, while giving effect to this order in accordance with law. Ground No. 9 does not require separate adjudication. 229. The issue arising in Ground No. 10 pertains to initiation of penalty proceedings u/s. 271(1)(c) of the Act. 230. The Ground challenging initiation of penalty procee....
X X X X Extracts X X X X
X X X X Extracts X X X X
....is identical to Ground No. 3 of the assessee's appeal for A.Y. 2006-07, adjudicated at para 210 hereinabove. Our findings therein shall apply mutatis mutandis, and the impugned addition on account of customer security deposits is directed to be deleted. Ground No. 4 is allowed. 244. The issue arising in Ground No. 5 pertains to deduction under section 80- IA of the Act on other income. 245. This Ground of appeal is identical to Ground No. 2 of the assessee's appeal for A.Y. 2010-11 (ITA No. 1021/Del/2015). 246. The issue is identical to Ground No. 2 of the assessee's appeal for A.Y. 2010-11, adjudicated at para 20 hereinabove. Our findings and directions therein shall apply mutatis mutandis while computing the eligible profits for the year under consideration. Ground No. 5 is partly allowed for statistical purposes. 247. The issue arising in Ground No. 6 pertains to enhancement of income by the Ld. CIT(A). 248. This Ground of appeal is identical to Ground No. 5 of the assessee's appeal for A.Y. 2003-04 (ITA No. 4216/Del/2013). 249. The issue is identical to Ground No. 5 of the assessee's appeal for A.Y. 2003-04, adjudicated at para 144 hereinabove. For....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o. 2 pertains to Disallowance of depreciation on provision for asset restoration cost ('ARC') obligation. 263. This Ground of appeal is identical to Ground No. 4 of the assessee's appeal for A.Y. 2010-11 (ITA No. 1021/Del/2015). 264. The issue is identical to Ground No. 4 of the assessee's appeal for A.Y. 2010-11, adjudicated at para 33 hereinabove. Our findings and directions therein shall apply mutatis mutandis. Ground No. 2 is partly allowed in the terms indicated therein. 265. The issue arising in Ground No. 3 pertains to addition on customer security deposit. 266. This Ground of appeal is identical to Ground No. 3 of the assessee's appeal for A.Y. 2006-07 (ITA No. 4223/Del/2013). 267. The issue is identical to Ground No. 3 of the assessee's appeal for A.Y. 2006-07, adjudicated at para 210 hereinabove. Our findings therein shall apply mutatis mutandis, and the impugned addition on account of customer security deposits is directed to be deleted. Ground No. 3 is allowed. 268. The issue arising in Ground No. 4 pertains to disallowance u/s 40(a)(ia) of the Act on account of non-deduction of taxes at source on the discount extended to prepaid distributor. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....therein shall apply mutatis mutandis to the year under consideration, and the Ld. AO shall give consequential effect after determining the subsisting assessed income and the deduction actually admissible. Ground No. 8 is allowed for statistical purposes. 283. The issue arising in Ground No. 9 pertains to deduction under section 80- IA of the Act on other income. 284. This ground of appeal is identical to ground no. 2 of the Appellant's appeal for A.Y. 2010-11 (ITA No. 1021/Del/2015). 285. The issue is identical to Ground No. 2 of the assessee's appeal for A.Y. 2010-11, adjudicated at para 20 here in above. Our findings and directions therein shall apply mutatis mutandis while computing the eligible profits for the year under consideration. Ground No. 9 is partly allowed for statistical purposes. 286. The issue arising in Ground No. 10 pertains to non-grant of full credit in respect of TDS. 287. The issue is identical to Ground No. 12 of the assessee's appeal for A.Y. 2010-11, adjudicated at para 84 hereinabove. Our findings and directions therein shall apply mutatis mutandis. Ground No. 10 is allowed for statistical purposes. 288. The issue arising in Grou....