JOHNSON & JOHNSON LTD, MUMBAI v. DCIT LT-1, MUMBAI

ITA 1454/MUM/2015 | 2010-11
Pronouncement Date: 19-03-2021 | Result: Partly Allowed

Appeal Details

RSA Number 145419914 RSA 2015
Bench Mumbai
Appeal Number ITA 1454/MUM/2015
Appellant JOHNSON & JOHNSON LTD, MUMBAI
Respondent DCIT LT-1, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 19-03-2021
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted K
Tribunal Order Date 19-03-2021
Last Hearing Date 01-04-2020
First Hearing Date 01-04-2020
Assessment Year 2010-11
Appeal Filed On 10-03-2015
Judgment Text
IN THE INC OME TAX APPELLATE TRIBUNAL K BENCH MUMBAI BEFORE SHRI VIKAS AWASTHY J M & SHRI S. RIFAUR RAHMAN AM ./ I.T.A. NO . 1454/MUM/2015 ( / ASSESSMENT YEAR: 2010 - 11 ) JOHNSON & JOHNSON PVT. LTD. 501 ARENA SPACE OFF JVLR OPP MAJAS BUS DEPOT JOGESHWARI (EAST) MUMBAI - 400 060 / VS. DCIT - LTU - 1 29 TH FLOOR CENTRE NO. 1 WORLD TRADE CENTRE CUFFE PARADE MUMBAI - 400 005 ./ ./ PAN NO. A A ACJ0866E ( / APPELLANT ) : ( / RESPONDENT ) AND ./ I.T.A. NO . 1043/MUM/2015 ( / ASSESSMENT YEAR: 20 10 - 11 ) DCIT - LTU - 1 29 TH FLOOR CENTRE NO. 1 WORLD TRADE CENTRE CUFFE PARADE MUMBAI - 400 005 / VS. JOHNSON & JOHNSON PVT. LTD. 501 ARENA SPACE OFF JVLR OPP MAJAS BUS DE POT JOGESHWARI (EAST) MUMBAI - 400 060 ./ ./ PAN NO. AA ACJ0866E ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI RAJAN R. VORA & SHRI PRANAY GANDHI ARS / RESPONDENTBY : SHRI SUNIL KUMAR MISHRA DR. 2 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. / DATE OF HEARING : 14 .01 .202 1 / DATE OF PRONOUNCEMENT : 19.03.2021 / O R D E R PER S. RIFAUR RAHMAN (ACCOUNTANT MEMBER) : THE PRESENT APPEAL /CROSS APPEAL FILED BY THE ASSESSEE AND REVENUE AGAINST THE ASS ESSMENT ORDER PASSED BY AO U/S 143(3) R.W.S. 144C(13) OF THE ACT DATED 15.01.2015 FOR ASSESSMENT YEAR 2 010 - 1 1 RESPECTIVELY. 2 . AT THE OUTSET WE NOTICE THAT ASSESSEE HAS FILED THE ADDITIONAL GROUNDS OF APPEAL WHICH ARE LEGAL IN NATURE THEREFORE WE DEEM I T FIT TO ADJUDICATE THE SAME. ACCORDINGLY THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IS ADMITTED FOR ADJUDICATION ON MERITS. 3. SINC E THE ISSUES RAISED IN BOTH THE APPEAL /CROSS APPEAL ARE IDENTICAL THEREFORE FOR TH E SAKE OF CONVENIENCE THESE APPEA LS ARE HEARD AND DISPOSED O F F BY THIS CONSOLIDATED ORDE R. THEREFORE WE ARE DEALING ISSUES GROUND - WISE RAISED BY ASSESSEE FIRSTLY. 3 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. GROUND NO. 1 WITH REGARD TO ADJUSTMENT TO THE TO T AL INCOME AT RS. 298.85 AS AGAINST RETURNED INCOME OF RS. 125.29 CRORES. 4 . THIS GROUND RAISED BY THE ASSESSEE IS GENERAL IN NATURE THEREFORE NEEDS NO SPECIFIC ADJUDICATION. GROUND NO. 2 TO 16 WITH REGARD TO ADJUSTMENT IN RESPECT OF ADVERTISING MARKETING AND PROMOTION (AMP) EXPENDITURE. 5 . BEFORE US LD. AR SUBMITTED TH AT THE EFFECTIVE GROUNDS OF APPEAL ARE GROUND NO. 2 3 & 5. THEREFORE THE OTHER GROUNDS RAISED BY THE ASSESSEE ARE ALTERNATIVE PLEAS WHICH REQUIRES NO ADJUDICATION. HE BRO UGHT TO OUR NOTICE PARA 9.27 & 10.11 OF TPO ORDER AND PARA 8.2 OF LD. DRP ORDER AND SUBMITTED THAT THE SIMILAR ISSUE HAS ALREADY BEEN DECIDED BY THE COORDINATE BENCH OF ITAT IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR : 2008 - 09 (ITA NO. 6142/MUM/2017 ) ON MERITS IN FA VOUR OF THE ASSESSEE. 6 . ON THE OTHER HAND LD. DR RELIED ON THE ORDERS PASSED BY REVENUE AUTHORITIES HOWEVER HE CONCEDED THAT THESE GROUND ARE COVERED BY THE ORDER OF ITAT. 7 . CONSIDERED THE RIVAL SUBMISSION AND MATERIAL PLACED ON RECORD. WE ARE ADJUDICATING THE GROUNDS NO. 2 3 & 5 AND ALL OTHER GROUNDS ARE DISMISSED WHICH ARE ALTERNATIVE PLEAS AND ACADEMIC 4 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. IN NATURE. WE NOTICE FROM THE RE CORDS THAT THE IDENTICAL GROUND HAS ALREADY BEEN DECIDED BY THE COORDINA TE BENCH OF ITAT IN ITA NO. 6142/MUM/2017 FOR AY 200 8 - 0 9 IN ASSESSEES OWN CASE ON MERITS. FOR THE SAKE OF CLARITY WHICH IS REPRODUCED BELOW: - 15. THUS IT IS TO BE UNDERSTOOD FROM THE DECISION OF THE HON'BLE DELHI HIGH COURT IN MARUTI SUZUKI INDIA LTD. (SUPRA) UNLESS THERE IS AN ARRANGEMENT BETWEEN THE ASSESSEE AND THE AE FOR INCURRING AMP EXPENDITURE IT CANNOT BE CONSIDERED AS INTERNATIONAL TRANSACTION UNDER SECTION 92B OF THE ACT. FURTHER THE HON'BLE COURT HAS HELD THAT NO ADJUSTMENT FOR DETERMINATION OF ARM'S LENGTH PRICE WITH REGARD TO AMP EXPENDITURE CAN BE MADE BY RESORTING TO BRIGHT LINE TEST OR ANY OTHER SI MILAR METHOD WHICH IS NOT PROVIDED IN THE STATUTE. UNDISPUTEDLY THE DECISION IN MARUTI SUZUKI INDIA LTD. (SUPRA) WAS DELIVERED BY THE HON'BLE DELHI HIGH COURT AT A LATER POINT OF TIME AND AFTER TAKING NOTE OF ITS OWN DECISION IN SONY ERICSON MOBILE COMMUN ICATIONS (SUPRA). THEREFORE THE RATIO LAID DOWN IN MARUTI SUZUKI INDIA LTD. (SUPRA) WOULD PREVAIL. MOREOVER THE RATIO LAID DOWN IN MARUTI SUZUKI INDIA LTD. (SUPRA) WOULD BE APPLICABLE TO THE PRESENT APPEAL SINCE FACTS ARE MORE OR LESS SIMILAR. LIKE IN MA RUTI SUZUKI INDIA 5 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. LTD. (SUPRA) THE ASSESSEE BEFORE US IS INVOLVED IN MANUFACTURING ACTIVITY HENCE THE AMP EXPENDITURE INCURRED IN INDIA BY MAKING PAYMENT TO THIRD PARTIES IN INDIA CERTAINLY IS CONNECTED WITH SUCH MANUFACTURING ACTIVITIES. MOREOVER THE DEPARTMENT HAS FAILED TO ESTABLISH ON RECORD THAT THERE IS AN ARRANGEMENT BETWEEN THE ASSESSEE AND THE AE FOR INCURRING AMP EXPENDITURE. IN ANY CASE OF THE MATTER QUANTIFICATION OF AMP EXPENDITURE BY APPLYING THE BRIGHT LINE TEST OR ANY SUCH SIMILAR METHO D HAS NOT ONLY BEEN DISAPPROVED BY THE HON'BLE DELHI HIGH COURT IN SONY ERICSON MOBILE COMMUNICATIONS (SUPRA) BUT ALSO IN MARUTI SUZUKI INDIA LTD. (SUPRA). IN OUR CONSIDERED VIEW THE TRANSFER PRICING OFFICER WAS TOTALLY WRONG IN NOT APPLYING THE PRINCIPLE LAID DOWN IN THE DECISION OF THE MARUTI SUZUKI INDIA LTD. (SUPRA) BY TAKING THE ALIBI THAT THE DECISION IS OF A NON JURISDICTIONAL HIGH COURT. FURTHER THE TRANSFER PRICING OFFICER WAS TOTALLY WRONG IN DETERMINING THE ARM'S LENGTH PRICE EXPENDITURE BY APP LYING THE BRIGHT LINE TEST OR ROUTINE ARM'S LENGTH PRICE SIMPLY RELYING UPON THE SPECIAL BENCH DECISION OF THE TRIBUNAL DELHI BENCH CONVENIENTLY IGNORING THE FACT THAT THE BRIGHT LINE TEST METHOD ADOPTED IN CASE OF L.G. ELECTRONICS INDIA PVT. LTD. (SUPRA ) WAS DISAPPROVED BY THE HON'BLE DELHI HIGH COURT NOT ONLY IN CASE OF SONY ERICSON MOBILE 6 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. COMMUNICATIONS (SUPRA) BUT ALSO IN CASE OF MARUTI SUZUKI INDIA LTD. (SUPRA). THUS THE REASONING OF THE ASSESSING OFFICER IN NOT FOLLOWING THE DECISION OF MARUTI SUZU KI INDIA LTD. (SUPRA) IS TOTALLY UNACCEPTABLE. WE MUST PUT IT ON RECORD THE DECISION OF THE HON'BLE DELHI HIGH COURT IN MARUTI SUZUKI INDIA LTD. (SUPRA) HAS SUBSEQUENTLY BEEN FOLLOWED NOT ONLY BY THE SAME HIGH COURT IN A NUMBER OF OTHER CASES BUT ALSO BY DIFFERENT BENCHES OF TRIBUNAL INCLUDING MUMBAI BENCHES INSOFAR IT RELATES TO THE ISSUE WHETHER AMP EXPENDITURE INCURRED IN INDIA GIVES RISE TO INTERNATIONAL TRANSACTION WITH THE AES. IT IS RELEVANT TO OBSERVE THE DRP HAS UPHELD THE ADJUSTMENT MADE BY TH E TRANSFER PRICING OFFICER SIMPLY FOR THE REASON THAT THE DEPARTMENT HAS NO REMEDY AVAILABLE AGAINST AN ORDER OF THE DRP FAVOURABLE TO THE ASSESSEE. AS REGARDS THE DECISIONS RELIED UPON BY THE LEARNED DEPARTMENTAL REPRESENTATIVE AS NOTED HEREIN BEFORE ON A CAREFUL ANALYSIS OF EACH ONE OF THESE DECISIONS WE ARE OF THE CONSIDERED OPINION THAT THEY WILL NOT BE OF ANY HELP TO THE DEPARTMENT SINCE THEY WERE RENDERED PRIOR TO THE DECISION OF THE HON'BLE DELHI HIGH COURT IN MARUTI SUZUKI INDIA LTD. (SUPRA) AND ALL OF THEM PROCEEDED ON THE BASIS OF THE DECISION RENDERED IN SONY ERICSON MOBILE COMMUNICATIONS (SUPRA). IN VIEW OF THE AFORESAID WE HOLD THAT THE AMP EXPENDITURE 7 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. INCURRED BY THE ASSESSEE NOT BEING AN INTERNATIONAL TRANSACTION AS DEFINED UNDER SECTION 9 2B OF THE ACT NO TRANSFER PRICING ADJUSTMENT COULD HAVE BEEN MADE BY THE TRANSFER PRICING OFFICER. MORE SO WHEN THE METHOD ADOPTED BY THE TRANSFER PRICING OFFICER FOR MAKING SUCH ADJUSTMENT IS NOT PROVIDED UNDER THE STATUTE. BEFORE PARTING WE MUST OBSER VE THAT ALL OTHER INTERNATIONAL TRANSACTIONS ENTERED INTO BETWEEN THE ASSESSEE AND ITS AE WERE FOUND TO BE AT ARMS LENGTH. IT IS ALSO NOT DISPUTED IF THE INTERNATIONAL TRANSACTIONS ARE CONSIDERED AS A WHOLE THE MARGIN SHOWN BY THE ASSESSEE IS MORE THAN THE MARGIN SHOWN BY THE COMPARABLES SELECTED BY THE TRANSFER PRICING OFFICER. GROUNDS RAISED ARE ALLOWED. 8 . T HEREFORE RESPECTFULLY FOLLOWING THE ABOVE DECISION OF COORDINATE BENCH IN ASSESSEES OWN CASE IN TURN RELYING ON THE DECISION OF ASSESSMENT YEAR 2008 - 09. THESE ISSUE ARE SETTLED IN FAVOUR OF THE ASSESSEE. THEREFORE WE ARE INCLINED TO ACCEPT THE SUBMISS I ON OF LD. AR. ACCORDINGLY THE GROUND NOS. 2 3 & 5 RAISED BY THE ASSESSEE ARE ALLOWED . GROUND NO. 17 TO 25 WITH REGARD TO ADJUSTMENT IN RESPECT O F TECHNICAL SUPPORT SERVICES OTHER SUPPORT SERVICES AND PASS THROUGH COST. 8 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. 9 . BEFORE US LD. AR BROUGHT TO OUR NOTICE PARA 12.15 TO 12.18 OF TPO ORDER AND PARA 9.2 OF LD. DRP ORDER AND SUBMITTED THAT ASSESSEE HAS SUBMITTED VOLUMINOUS INFORMATION BEFORE TPO AND LD. DRP HAS NOT EXAMINED THE FACTS OF THE CASE AND UPHELD THE ADJUSTMENT MADE BY THE TPO WITHOUT PROVI DING ANY SUBSTANTIAL COMMENTS. HE BROUGHT TO OUR NOTICE THAT IN ASSESSMENT YEAR 2008 - 09 DETAILED EXAMINATION OF THE DATA WERE CONDUCTED AND ASSE SSEE HAS ACCEPTED THE FINDINGS. T HEREFORE HE PRAYED TO RESTORE THE ISSUE. 10 . ON THE OTHER HAND LD. DR RELIED ON THE ORDERS PASSED BY REVENUE AUTHORITIES . 11 . CONSIDERED THE RIVAL SUBMISSION AND MATERIAL PLACED ON RECORD. WE NOTICE FROM THE RECORDS TH AT TPO & LD. DRP HAS NOT EXAMINED THE VOLUMINOUS DATA SUBMITTED BY ASSESSEE. LD. DRP MERELY OBSERVED THAT THE CLINICAL TRIALS ARE NOT CONDUCTED ON ITS OWN THE ASSESSEE NEITHER HAS PERSONNEL NOR INFRASTRUCTURE TO CONDUCT SUCH TRIALS THEREFORE IT CANNOT B E TERMED AS TECHNICAL SERVICE. HENCE HE REJECTED THE SUBMISSIONS OF THE ASSESSEE WITHOUT ACTUALLY VERIFYING THE DATA BEFORE THEM. THEREFORE IT IS 9 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. FIT CASE F OR RESTORING THE MATTER TO THE AO /TPO FOR FRESH ADJUDICATION OF THE MATTER ON MERITS. ACCORDINGLY THESE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES . GROUND NO. 26 WITH REGARD TO ADJUSTMENT U/S 145A OF THE ACT. 12 . THIS GROUND IS NOT PRESSED BY THE ASSESSEE THEREFORE THIS GROUND BECOMES INFRUCTUOUS AS NOT PRESSED. GROUND N O. 27 TO 28 WITH REGARD TO DISALLOWANCE U/S 36(1)(III) OF THE ACT. 13 . BEFORE US LD. AR BROUGHT TO OUR NOTICE PARA 11 OF TPO ORDER AND PARA 15 OF LD. DRP ORDER AND SUBMITTED THAT THE SIMILAR ISSUE HAS ALREADY BEEN DECIDED BY THE COORDINATE BENCH OF ITAT IN ASSESSEES OWN CASE AND THE DECISION OF JURISDICTIONAL BOMBAY HIGH COURT IN THE CASE OF RELIANCE UTILITIES WHEREIN THE HONBLE BOMBAY HIGH COURT OBSERVED THAT ASSESSEE HAS INTEREST FREE FUNDS THEREFORE NO DISALLOWANCE U/S 36(1)(III) IS WARRANTED. 1 4. ON THE OTHER HAND LD. DR RELIED ON THE ORDERS PASSED BY REVENUE AUTHORITIES . 1 5. CONSIDERED THE RIVAL SUBMISSION AND MATERIAL PLACED ON RECORD. WE NOTICE FROM THE RECORDS THAT THE IDENTICAL GROUND HAS 10 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. ALREADY BEEN DECIDED BY THE COORDINATE BENCH OF ITAT IN ASSESSEES OWN CASE AND ITAT HAD RESTORED THE ISSUE TO THE AO TO ANALYSE THE EXISTENCE OF INTEREST FREE FUNDS AND WHILE APPLYING THE JUDGMENT OF HONBLE JURISDICTIONAL BOMBAY HIGH COURT IN THE CASE OF RELIANCE UTILITIES (313 ITR 340). WHILE GIVING EFFEC T TO THE ITAT ORDER THE AO IN ORDER PASSED ASSESSMENT U/S 143(3) R.W.S 254 OF THE ACT OBSERVING THAT ASSESSEE HAS INTEREST FREE FUNDS AS AGAINST ADVANCE THEREFORE NO DISALLOWANCE U/S 36(1)(III) IS WARRANTED. 16. FOR THE YEAR UNDER CONSIDERATION ASSESSE E HAS INTEREST FREE FUND OF RS. 643.18 CRORES AND ADVANCE OF RS. 23.48 CRORES. SINCE ASSESSEE HAS SUFFICIENT FUNDS AND BY FOLLOWING THE ABOVE DECISION NO DISALLOWANCE OF INTEREST U/S 36(1)(III) OF THE ACT IS WA RRANTED . ACCORDINGLY THESE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED. GROUND NO. 29 WITH REGARD TO SHORT GRANT OF CREDIT OF TDS. 17 . CONSIDERED THE RIVAL SUBMISSION ON THIS GROUND AND MATERIAL PLACED ON RECORD. WE ARE DIRECTING THE AO TO CONSIDER THE SUBMISSIONS OF THE ASSESSEE AND ALLOW THE TDS CREDIT AFTER 11 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. VERIFICATION AS PER LAW. ACCORDINGLY THIS GROUND RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES . GROUND NO. 30 & 31 WITH REGARD TO LEVY OF INTEREST U/S 234B AND 234D. 18 . THESE GROUND RAISED BY THE ASSESSEE ARE CONSEQUENTIAL IN NATURE THEREFORE IT BECOMES INFRUCTUOUS AS DISMISSED. GROUND NO. 32 WITH REGARD TO INITIATING PENALTY U/S 274 R.W.S. 271(1) OF THE ACT. 19 . THESE GROUND RAISED BY THE ASSESSEE IS PREMATURE AT THIS STAGE THE REFORE IT BECOMES INFRUCTUOUS ACCORDINGLY DISMISSED. ADDITIONAL GROUND NO. 33 WITH REGARD TO LEVY OF INTEREST U/S 234B AND 234D. 20 . BEFORE US LD. AR SUBMITTED THAT PAYMENT OF EDUCATION CE S S IS A NECESSARY FOR SMOOTH RUNNING OF THE BUSINESS AND HENCE IS A DEDUCTIBLE EXPENSES U/S 37 OF THE AC T. HE FURTHER SUBMITTED THAT AS PER THE PROVISION OF SECTION 40(A)(II) EDUCATION CESS IS NEITHER LEVIED ON THE PROFITS OR GAINS OF ANY BUSINESS OR PROFESSION AND EDUCATION CESS IS LEVIED ON THE AMOUNT OF TAX. THEREFORE BY RELYING ON THE VARIOUS DECISIONS IN THE RESPECT HE PRAYED EDUCATION CESS BE ALLOWED AS DEDUCTION U/S 37(1) OF THE ACT. 12 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. 21 . ON THE OTHER HAND LD. DR RELIED ON THE ORDER S PASSED BY REVENUE AUTHORITIES. 22 . CONSIDERED THE RIVAL SUBMISSION AND MATERIAL PLACED ON RECORD. WE NOTICE FROM THE RECORDS THAT THE IDENTICAL GROUND HAS ALREADY BEEN DECIDED BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF SESA GOA LTD. (202) 107 CCH 0376 BOM. FOR THE SAKE OF CLARITY WHICH IS REPRODUCED BELOW: - 27. THE CBDT CIRCULAR IS BINDING UPON THE AUTHORITIES UNDER THE IT ACT LIKE ASSESSING OFFICER AND THE APPELLATE AUTHORITY. THE CBDT CIRCULAR IS QUITE CONSISTENT WITH THE PRINCIPLES OF INTERPRETATION OF TAXING STATUTE. THIS ACCORDING TO US IS AN ADDITIONAL REASON AS TO WHY THE EXPRESSION CESS OUGHT NOT TO BE READ OR INCLUDED IN THE EXPRESSION ANY RATE OR TAX LEVIED AS APPEARING IN SECTION 40(A)(II) OF THE IT ACT. 28. IN THE INCOME TAX ACT 1922 SECTION 10(4) HAD BANNED ALLOWANCE OF ANY SUM PAID ON ACCOUNT OF ANY CESS RATE OR TAX LEVIED ON THE PROFITS O R GAINS OF ANY BUSINESS OR PROFESSION . IN THE CORRESPONDING SECTION 40(A)(II) OF THE IT ACT 1961 THE EXPRESSION CESS IS QUITE CONSPICUOUS BY ITS ABSENCE. IN FACT LEGISLATIVE HISTORY BEARS OUT THAT THIS EXPRESSION WAS IN FACT TO BE FOUND IN THE INCOME TAX BILL 1961 WHICH WAS 13 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. INTRODUCED IN THE PARLIAMENT. HOWEVER THE SELECT COMMITTEE RECOMMENDED THE OMISSION OF EXPRESSION CESS AND CONSEQUENTLY THIS EXPRESSION FINDS NO PLACE IN THE FINAL TEXT OF THE PROVISION IN SECTION 40(A)(II) OF THE IT ACT 1961. THE EFFECT OF SUCH OMISSION IS THAT THE PROVISION IN SECTION 40(A)(II) DOES NOT INCLUDE CESS AND CONSEQUENTLY CESS WHENEVER PAID IN RELATION TO BUSINESS IS ALLOWABLE AS DEDUCTABLE EXPENDITURE. 23 . T HEREFORE RESPECTFULLY FOLLOWING THE ABOVE DECISIO N WE ARE INCLINED TO ACCEPT THE SUBMISSION OF LD. AR. ACCORDINGLY THIS GROUND RAISED BY THE ASSESSEE IS ALLOWED . 24. NOW WE ARE DEALING ISSUES GROUND - WISE RAISED BY THE REVENUE IN ITA NO. 1043/MUM/2015 FOR ASSESSMENT YEAR 2010 - 11. GROUND NO. 1 WITH REG ARD TO DISALLOWANCE OF TAX DEDUCTION ON BRAND USAGE ROYALTY. 25 . CONSIDERED THE RIVAL SUBMISSIONS AND MATERIAL PLACED ON RECORD ON THIS GROUND. WE NOTICE FROM THE RECORD THAT THE IDENTICAL GROUND HAS ALREADY BEEN DECIDED BY THE COORDINATE BENCH OF ITAT IN ITA NO. 4161/MUM/2017 FOR ASSESSMENT 14 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. YEAR 2007 - 08 IN ASSESSEES OWN CASE ON MERITS. FOR THE SAKE OF CLARITY WHICH IS REPRODUCED BELOW: - 2. THE GROUND NO.1 RAISED BY THE REVENUE IS WITH REGARD TO THE ACTION OF THE LD.CIT(A) IN DELETING THE ADJUSTMENT MA DE ON ACCOUNT OF INCOME TAX ON BRAND USAGE ROYALTY. AT THE OUTSET WE FIND THAT THIS ISSUE IS COVERED BY THE CO - ORDINATE BENCH DECISION OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2005 - 2006 IN ITA NO.2547/MUM/2017 DATED 26.12.2018 EXCEPT FO R VARIANCE IN FIGURES WHEREIN IT WAS HELD AS UNDER: - 8. WE HAVE CONSIDERED THE SUBMISSION OF THE PARTIES AND HAVE GONE THROUGH THE ORDER OF AUTHORITIES BELOW. WE HAVE NOTED THAT SIMILAR GROUND OF APPEAL WAS RAISED BEFORE TRIBUNAL IN ASSESSEE'S OWN CASE FOR A.Y. 2002 - 03 IN ITA NO. 4092/MUM/2007 AND THE CO - ORDINATE BENCH OF TRIBUNAL PASSED THE FOLLOWING ORDER: 34. WE HAVE HEARD THE RIVAL SUBMISSIONS PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND ALSO THE COPY OF AGREEMENT SUBMITTED ALONGWITH APPLICATION TO RBI AS EXHIBITED AT PAGES 1143 TO 1145 OF THE PAPER BOOK. WE FIND THAT THE APPLICATION MADE BY THE ASSESSEE TO RBI FOR BRAND 15 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. USAGE AGREEMENT SPECIFICALLY MENTIONS THAT THE ROYALTY TO BE REMITTED IS NET OF TAXES. FURTHER THE APPROVAL WAS RECEIVED FROM T HE RBI TO REMIT THE ROYALTY ON BRAND USAGE BY THE ASSESSEE @ 1 % NET OF TAXES. CONSIDERING THE BRAND USAGE AGREEMENT VIS - - VIS THE APPROVAL GRANTED BY RBI IT CAN BE SAFELY INFERRED THAT TAXES WERE LIABILITY OF J&J INDIA UNDER THE TERMS OF AGREEMENT. THE A SSESSEE HAS ENTERED INTO A COMMERCIAL ARRANGEMENT WITH J&J US AND IT HAS BEEN SO ARRANGED THAT THE PAYMENT OF TAXES HAVE TO BE BORNE BY THE ASSESSEE BEING A COMMERCIAL ARRANGEMENT THE SAME SHOULD NOT BE QUESTIONED WHILE CALCULATING ARMS LENGTH PRICE. RELI ANCE BY THE ASSESSEE ON THE DECISION OF THE TRIBUNAL IN THE CASE OF DRESSER RAND INDIA PVT. LTD. IN ITA NO. 3509/M/08 IS WELL FOUNDED. CONSIDERING THE ENTIRE FACTS IN TOTALITY IN THE LIGHT OF THE BRAND USAGE AGREEMENT AND THE APPROVAL OF THE RBI THE FINDI NGS OF THE LD. CIT(A) IS SET ASIDE. THE AO IS DIRECTED TO DELETE THE ADDITION OF RS. 60 00 000/ - . GROUND NO. 13 IS ALLOWED. 9. CONSIDERING THE DECISION OF TRIBUNAL IN ASSESSEE'S OWN CASE FOR A.Y. 2002 - 03 WHICH WAS FOLLOWED IN A.Y. 2006 - 07 IN ITA NO. 83/MU M/2011 FOR A.Y. 2008 - 09 IN ITA NO. 16 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. 7133/MUM/2012 AND FURTHER IN A.Y. 2009 - 10 IN ITA NO. 829/MUM/2014 ON IDENTICAL GROUND WE CONFIRMED THE ORDER OF LD. CIT(A). IN THE RESULT GROUND NO.1 OF THE APPEAL IS DISMISSED. 2.1. RESPECTFULLY FOLLOWING THE SAID D ECISION GROUND NO.1 RAISED BY THE REVENUE IS DISMISSED. 26 . T HEREFORE RESPECTFU LLY FOLLOWING THE ABOVE DECISION WE REJECT THE CONTENTION OF REVENUE. ACCORDINGLY THIS GROUND RAISED BY THE REVENUE IS DISMISSED . GROUND NO. 2 & 6 WITH REGARD TO SERVICE TA X PAID ON BRAND USAGE ROYALTY PAID AND ON KNOW HOW ROYALTY PAID. 27 . CONSIDERED THE RIVAL SUBMISSIONS AND MATERIAL PLACED ON RECORD ON THESE GROUNDS. WE NOTICE FROM THE RECORD THAT THE IDENTICAL GROUND HAS ALREADY BEEN DECIDED BY THE COORDINATE BENCH OF I TAT IN ITA NO. 83/MUM/2011 FOR ASSESSMENT YEAR 2006 - 07 IN ASSESSEES OWN CASE ON MERITS. FOR THE SAKE OF CLARITY WHICH IS REPRODUCED BELOW: - 34. IN RESPECT OF GROUND TAKEN BY ASSESSEE FOR MAKING DISALLOWANCE ON ACCOUNT OF TAX SERVICE TAX PAID BY ASSESSEE ON THE PAYMENT OF ROYALTY WE OBSERVE THAT THE SAID ISSUE HAS ALREADY BEEN CONSIDERED BY TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2002 - 03 17 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. (SUPRA) AND THE TRIBUNAL HAS HELD AFTER CONSIDERING THE AGREEMENTS ENTERED INTO BETWEEN THE ASSESSEE A ND J&J US AND ALSO THE DECISION IN THE CASE OF DRESSER RAND INDIA P. LTD. (SUPRA) THAT THE TAXES WERE LIABILITY OF THE ASSESSEECOMPANY UNDER THE TERMS OF AGREEMENTS AND ACCORDINGLY DISALLOWANCE MADE BY AO WERE DELETED. FURTHER WE ALSO OBSERVE THAT LIABILI TY OF PAYMENT OF SERVICE TAX IS OF RECIPIENT OF SERVICES AND SINCE ASSESSEE IS THE RECEIVER OF SERVICES IT IS THE LIABILITY OF THE ASSESSEE COMPANY TO BEAR SERVICE TAX. HENCE WE HOLD THAT TPO WAS NOT JUSTIFIED TO STATE THAT LIABILITY OF BEARING SERVICE TA X WAS OF ASSESSEE - COMPANY. IN VIEW OF ABOVE WE HOLD THAT DISALLOWANCES MADE BY TPO ON ACCOUNT OF TAXES SERVICES TAX IS NOT JUSTIFIED AND WE DIRECT TO DELETE THE SAME. HENCE GROUND NOS.12 13 AND 17 OF THE APPEAL TAKEN BY ASSESSEE ARE ALLOWED. 35. IN RE SPECT OF DISALLOWANCE OF TAX AND R&D CESS PAID ON TECHNICAL KNOW - HOW ROYALTY ON TRADED FINISHED GOODS AND MANUFACTURED PRODUCTS WE OBSERVE THAT THE SAID ISSUE WAS ALSO CONSIDERED BY TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2002 - 03 AND THE T RIBUNAL (VIDE PARA 42 OF THE ORDER) HELD THAT SAID PAYMENTS HAVE BEEN MADE BY ASSESSEE IN THE LIGHT OF AGREEMENT WITH J&J US AND AS PER APPROVAL/GUIDELINES OF RBI AND ACCORDINGLY DIRECTED THE AO TO DELETE THE DISALLOWANCE/ TAX AND R&D CESS 18 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. PAID ON TECHNICA L ROYALTY. RESPECTFULLY FOLLOWING THE ABOVE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE AND ALSO CONSIDERING THE ALTERNATIVE CONTENTION OF ASSESSEE THAT R&D CESS AND SERVICE TAX CANNOT BE TREATED AS INTERNATIONAL TRANSACTION IN VIEW OF THE DECISION OF IT AT PUNE BENCH IN THE CASE OF KIRLOSKAR EBARA PUMPS LTD(SUPRA) WE DELETE THE DISALLOWANCE MADE BY AO/DRP OF TAX AND R&D CESS PAID ON TECHNICAL KNOW - HOW ROYALTY ON TRADED GOODS AND MANUFACTURED PRODUCTS BY ALLOWING GROUND NO.16 OF THE APPEAL TAKEN BY THE A SSESSEE. 28 . T HEREFORE RESPECTFU LLY FOLLOWING THE ABOVE DECISION WE REJECT THE CONTENTION OF REVENUE. ACCORDINGLY THESE GROUND RAISED BY THE REVENUE ARE DISMISSED . GROUND NO. 3 WITH REGARD TO DISALLOWANCE OF ENTIRE TECHNICAL KNOW HOW ROYALTY PAYMENT ON TRADED GOODS. 29 . CONSIDERED THE RIVAL SUBMISSIONS AND MATERIAL PLACED ON RECORD ON THESE GROUNDS. WE NOTICE FROM THE RECORD THAT THE IDENTICAL GROUND HAS ALREADY BEEN DECIDED BY THE COORDINATE BENCH OF ITAT IN ITA NO. 4161/MUM/2017 FOR ASSESSMENT YEAR 20 07 - 08 IN ASSESSEES OWN CASE ON MERITS. FOR THE SAKE OF CLARITY WHICH IS REPRODUCED BELOW: - 19 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. 3. GROUND NO.2 RAISED BY THE REVENUE IS WITH REGARD TO THE ACTION OF THE LD.CIT(A) IN DELETING THE ADJUSTMENT MADE ON ACCOUNT OF PAYMENT OF ROYALTY ON TRADED FINIS HED GOODS MADE BY THE ASSESSEE TO JOHNSON & JOHNSON USA. WE FIND THAT THIS ISSUE IS ALSO COVERED BY THE DECISION OF THIS TRIBUNAL IN ASSESSEES OWN CASE (SUPRA) FOR ASSESSMENT YEAR 2005 - 2006 WHEREIN IT WAS HELD AS UNDER: - 14.WE HAVE CONSIDERED THE SUBMI SSION OF THE PARTIES AND FIND THAT IN ASSESSEE'S OWN CASE FOR A.Y. 2002 - 03 IN ITA NO. 4092/MUM/2007 AND ITA NO. 4070/MUM/2007 THE TRIBUNAL PASSED THE FOLLOWING ORDER: 49. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS PERUSED THE ORDERS OF THE LOWER AUTHORITI ES AND THE MATERIAL EVIDENCE BROUGHT ON RECORD IN THE FORM OF PAPER BOOK. IN ASSESSEE'S APPEAL WE HAVE ALREADY HELD THAT THE AGREEMENTS BETWEEN J&J INDIA AND J&J USA FOR PAYMENT OF ROYALTY HAS TO BE CONSIDERED IN THE LIGHT OF THE APPROVAL OF THE RBI. WE D O NOT FIND ANY SUBSTANCE IN THE FINDINGS OF THE TPO THAT THERE IS NO NEED FOR PAYING ROYALTY FOR TECHNICAL/MARKETING KNOW - HOW. WE ALSO DO NOT FIND ANY FORCE IN THE FINDINGS OF THE TPO THAT THIS ROYALTY IS DEEMED TO BE INCLUDED IN 20 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. BRAND ROYALTY. THE LD. CT T(A) HAS RIGHTLY CONSIDERED THE RELEVANT CLAUSES OF THE AGREEMENT BETWEEN J&J INDIA AND J&J USA. WE THEREFORE DO NOT FIND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A). 15.CONSIDERING THE DECISION OF TRIBUNAL IN ASSESSEE'S OWN CASE FOR A.Y . 2002 - 03 IN ITA NO. 4092/MUM/2007 AND IN ITA NO. 4070/MUM/2007 WHICH WAS FOLLOWED IN A.Y. 2006 - 07 IN ITA NO.83/MUM/201 1 AND IN A.Y. 200809 AND A. Y. 2009 - 10 IN ITA NO. 829/MUM/2014 ON IDENTICAL GROUND WE CONFIRMED THE ORDER OF ID. CIT(A). IN THE RESU LT GROUND NO.4 OF THE APPEAL IS DISMISSED. 3.1. RESPECTFULLY FOLLOWING THE SAID DECISION GROUND NO.2 RAISED BY THE REVENUE IS DISMISSED. 30 . T HEREFORE RESPECTFU LLY FOLLOWING THE ABOVE DECISION WE REJECT THE CONTENTION OF REVENUE. ACCORDINGLY TH IS G ROUND RAISED BY THE REVENUE IS DISMISSED . GROUND NO. 4 WITH REGARD TO RESTRICTING TECHNICAL KNOW - HOW ROYALTY TO 1% IN RESPECT OF MANUFACTURED GOODS. 3 1 . CONSIDERED THE RIVAL SUBMISSIONS AND MATERIAL PLACED ON RECORD ON THESE GROUNDS. WE NOTICE FROM THE R ECORD THAT THE IDENTICAL GROUND HAS ALREADY BEEN DECIDED BY THE COORDINATE 21 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. BENCH OF ITAT IN ITA NO. 4161/MUM/2017 FOR ASSESSMENT YEAR 2007 - 08 IN ASSESSEES OWN CASE ON MERITS. FOR THE SAKE OF CLARITY WHICH IS REPRODUCED BELOW: - 4. GROUND NO.3 RAISED BY TH E REVENUE IS WITH REGARD TO THE ACTION OF THE LD.CIT(A) IN ALLOWING THE TECHNICAL KNOW - HOW ROYALTY PAYMENT AT 2% / 4% INSTEAD OF 1% AS DONE BY THE LD.TPO. WE FIND THAT THIS ISSUE IS ALSO COVERED BY THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE (SUPRA) F OR ASSESSMENT YEAR 2005 - 2006 WHEREIN IT WAS HELD AS UNDER: - 17.WE HAVE CONSIDERED THE SUBMISSION OF THE PARTIES AND FIND THAT IN ASSESSEE'S OWN CASE FOR A.Y. 2002 - 03 IN ITA NO. 4092/MUM/2007 AND ITA NO. 4070/MUM/2007 THE TRIBUNAL PASSED THE FOLLOWING O RDER: ' 55. WE HAVE CONSIDERED THE SUBMISSIONS AND PERUSED THE ORDERS. AS WE HAVE ALREADY HELD HEREINABOVE THAT THE PAYMENT OF ROYALTY HAS TO BE CONSIDERED IN THE LIGHT OF THE AGREEMENT BETWEEN THE ASSESSEE AND J & J USA FOR THE SAME REASONS WE DO NOT FI ND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE ID. CIT(A).' 22 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. 18.FURTHER ON SIMILAR ISSUE FOR A.Y. 2006 - 07 IN ITA NO. 83/MUM/2011 DATED 05.02.2014 THE TRIBUNAL PASSED THE FOLLOWING ORDER: 55. WE HAVE CONSIDERED THE SUBMISSIONS AND PERUSED THE ORDERS. AS WE HAVE ALREADY HELD HEREINABOVE THAT THE PAYMENT OF ROYALTY HAS TO BE CONSIDERED IN THE LIGHT OF THE AGREEMENT BETWEEN THE ASSESSEE AND J&J USA FOR THE SAME REASONS WE DO NOT FIND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A). GROUND N O. 2 IS ACCORDINGLY DISMISSED. 19.CONSIDERING THE DECISION OF TRIBUNAL IN ASSESSEE'S OWN CASE FORA.Y. 2002 - 03 IN ITA NO. 4092/MUM/2007 AND IN ITA NO. 4070/UM/2007 WHICH WAS FOLLOWED IN A.Y. 2006 - 07 IN ITA NO.83/MUM/2011 AND IN A.Y. 2008 - 09 AND A.Y. 2009 - 10 IN ITA NO. 829/MUM/2014 ON IDENTICAL GROUND WE CONFIRMED THE ORDER OF ID. CIT(A). IN THE RESULT GROUND NO.5 OF THE APPEAL IS DISMISSED. 4.1. RESPECTFULLY FOLLOWING THE SAID DECISION GROUND NO.3 RAISED BY THE REVENUE IS DISMISSED. 32 . T HEREFORE R ESPECTFU LLY FOLLOWING THE ABOVE DECISION WE REJECT THE CONTENTION OF REVENUE. ACCORDINGLY THIS GROUND RAISED BY THE REVENUE IS DISMISSED . 23 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. GROUND NO. 5 WITH REGARD TO DISALLOWANCE OF TAX AND R & D CESS PAID ON TECHNICAL KNOW - HOW ROYALTY. 3 3 . CONSIDERED THE RIVAL SUBMISSIONS AND MATERIAL PLACED ON RECORD ON THESE GROUNDS. WE NOTICE FROM THE RECORD THAT THE IDENTICAL GROUND HAS ALREADY BEEN DECIDED BY THE COORDINATE BENCH OF ITAT IN ITA NO. 4161/MUM/2017 FOR ASSESSMENT YEAR 2007 - 08 IN ASSESSEES OWN CASE O N MERITS. FOR THE SAKE OF CLARITY WHICH IS REPRODUCED BELOW: - 6. GROUND NO.5 RAISED BY THE REVENUE IS WITH REGARD TO THE ACTION OF THE LD.CIT(A) IN DELETING THE ADJUSTMENT MADE ON ACCOUNT OF TAX R&D CESS ON KNOW - HOW ROYALTY AND TRADED FINISHED GOODS AND MANUFACTURED PRODUCTS. WE FIND THAT THIS ISSUE IS COVERED BY THE DECISION OF BY THIS TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2005 - 2006 (SUPRA) WHEREIN IT WAS HELD AS UNDER: - 21.WE HAVE CONSIDERED THE SUBMISSION OF THE PARTIES AND FIND THAT I N ASSESSEE'S OWN CASE FOR A.Y. 2002 - 03 IN ITA NO. 4092/MUM12007 AND ITA NO. 4070/MUM12007 THE TRIBUNAL PASSED THE FOLLOWING ORDER: 42. ...... AS WE HAVE ALREADY HELD ELSEWHERE THAT ROYALTY PAYMENTS HAS BEEN APPROVED BY RBI AND 24 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. THEREFORE DESERVES TO BE AL LOWED. ACCORDINGLY AS THE PAYMENTS HAVE BEEN MADE IN THE LIGHT OF THE AGREEMENT WITH J&J US AND AS PER THE APPROVAL/GUIDELINES OF THE RBI WE DO NOT FIND ANY REASON TO DISALLOW THE TAX AND R&D CESS PAID ON TECHNICAL ROYALTY. WE ACCORDINGLY DIRECT THE AO TO DELETE THE ADDITION MADE ON THIS ACCOUNT. 22.CONSIDERING THE DECISION OF TRIBUNAL IN ASSESSEE'S OWN CASE FOR A.Y. 2002 - 03 IN ITA NO. 4092/MUM/2007 AND IN ITA NO. 4070/MUM/2007 WHICH WAS FOLLOWED IN A.Y. 2006 - 07 IN ITA NO.83/MUM/2011 AND IN A.Y. 2008 - 09 AND A.Y. 2009 - 10 IN ITA NO. 829/MUM/2014 ON IDENTICAL GROUND WE CONFIRMED THE ORDER OF ID. CIT(A). IN THE RESULT GROUND NO.6 OF THE APPEAL IS DISMISSED. 6.1. RESPECTFULLY FOLLOWING THE SAID DECISION GROUND NO.5 RAISED BY THE REVENUE IS DISMISSED. 34 . T HEREFORE RESPECTFU LLY FOLLOWING THE ABOVE DECISION WE REJECT THE CONTENTION OF REVENUE. ACCORDINGLY THIS GROUND RAISED BY THE REVENUE IS DISMISSED . GROUND NO. 7 WITH REGARD TO DEPRECIATION ON TESTING EQUIPMENTS. 25 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. 3 5 . CONSIDERED THE RIVAL SUBMISSIONS AN D MATERIAL PLACED ON RECORD ON THESE GROUNDS. WE NOTICE FROM THE RECORD THAT THE IDENTICAL GROUND HAS ALREADY BEEN DECIDED BY THE COORDINATE BENCH OF ITAT IN ITA NO. 7133/MUM/2012 FOR ASSESSMENT YEAR 2008 - 09 IN ASSESSEES OWN CASE ON MERITS. FOR THE SAKE O F CLARITY WHICH IS REPRODUCED BELOW: - 36. GROUND NO. 31 & 32 RELATE TO THE DISALLOWANCE OF DEPRECIATION CLAIMED ON TESTING EQUIPMENTS. THIS GRIEVANCE OF THE ASSESSEE WAS CONSIDERED BY THE DRP VIDE OBJECTION NO. 13 AT PAGE - 18 OF ITS ORDER WHEREIN THE DRP H AS FOLLOWED HIS OWN FINDING FOR A.Y. 2006 - 07. SIMILAR ISSUE WAS CONSIDERED BY THE TRIBUNAL FOR A.Y. 2000 - 01 2001 - 02 2002 - 03 AND 2006 - 07 IN ITA NOS. 2774/M/04 9106/M/04 4070/M/07 AND 83/M/2011. WE FIND THAT THE TRIBUNAL IN A.Y. 2006 - 07 HAS CONSIDERED TH IS ISSUE AT PARA - 16 OF ITS ORDER AND AT PARA - 18 THE TRIBUNAL HAS CONSIDERED ITS FINDING OF THE CO - ORDINATE BENCH IN ASSESSEES OWN CASE FOR EARLIER ASSESSMENT YEARS AND ALLOWED THE CLAIM OF DEPRECIATION ON THE TESTING EQUIPMENTS. RESPECTFULLY FOLLOWING TH E FINDINGS OF THE TRIBUNAL (SUPRA) WE DIRECT THE AO TO ALLOW THE CLAIM OF DEPRECIATION ON TESTING EQUIPMENTS AMOUNTING TO RS. 199.06 LAKHS . GROUND NO. 31 & 32 ARE ACCORDINGLY ALLOWED. 26 I.T.A. NO. 1454 & 1043/MUM/2015 JOHNSON & JOHNSON PVT. LTD. 36 . T HEREFORE RESPECTFU LLY FOLLOWING THE ABOVE DECISION WE REJECT TH E CONTENTION OF REVENUE. ACCORDINGLY THIS GROUND RAISED BY THE REVENUE IS DISMISSED . 37 . IN THE NET RESULT THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED AND APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT 19/03 / 2021 . SD/ - SD/ - ( VIKASH AWASTHY ) (S. RIFAUR RAHMAN ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 19/03/ 2021 SR.PS. DHANANJAY / CO PY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. / DR ITAT MUMBAI 6. / GUARD FILE / BY ORDER . / (DY./ASSTT.REGISTRAR) / ITAT MUMBAI