DNV GL SE-INDIA BRANCH, MUMBAI v. DCIT (IT) 2(1)(2), MUMBAI

ITA 2379/MUM/2017 | 2012-2013
Pronouncement Date: 11-11-2019 | Result: Allowed

Appeal Details

RSA Number 237919914 RSA 2017
Assessee PAN AAACG7903R
Bench Mumbai
Appeal Number ITA 2379/MUM/2017
Duration Of Justice 2 year(s) 7 month(s) 7 day(s)
Appellant DNV GL SE-INDIA BRANCH, MUMBAI
Respondent DCIT (IT) 2(1)(2), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 11-11-2019
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted Not Allotted
Tribunal Order Date 11-11-2019
Last Hearing Date 01-01-2019
First Hearing Date 01-01-2019
Assessment Year 2012-2013
Appeal Filed On 04-04-2017
Judgment Text
IN THE INCOME-TAX APPELLATE TRIBUNAL K BENCH MUMB AI BEFORE SHRI SHAMIM YAHYA ACCOUNTAT MEMBER AND SHRI PAWAN SINGH JUDICIAL MEMBER IT(TP)A. NO. 2379/MUM/2017 (ASSESSMENT YEAR 2012-13 ) M/S DNV GL SE-INDIA BRANCH 6 TH FLOOR EQUINOX BUSINESS PARK TOWER III LBS MARG KURLA COMPLEX KURLA (WEST ) MUMBAI-400070 PAN: AAACG7903R VS. DCIT (IT)- 2(1)(2) MUMBAI. APPELLANT RESPONDE NT APPELLANT BY : SHRI M. SUBRAMANIAN (AR) RESPONDENT BY : SHRI RAJESH KUMAR MISHRA (ADDL. CIT) DATE OF HEARING : 11.11.2018 DATE OF PRONOUNCEMEN T : 11.11.2019 ORDER UNDER SECTION 254(1)OF INCOME TAX ACT PER PAWAN SINGH JUDICIAL MEMBER; 1. THIS APPEAL BY ASSESSEE UNDER SECTION 253 OF THE IN COME-TAX ACT (THE ACT) IS DIRECTED AGAINST THE ASSESSMENT ORDER DATED 27.0 1.2017 UNDER SECTION 143(3) R.W.S. 144C(13) PASSED IN PURSUANCE OF DIREC TION OF DISPUTE RESOLUTION PANEL (DRP) DATED 08.12.2016 UNDER SECT ION 144C(5) FOR ASSESSMENT YEAR 2012-13. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE-COMPA NY IS A TAX RESIDENT OF GERMANY AND ENGAGED IN THE BUSINESS OF INSPECTION A ND CERTIFICATION SERVICES IN MARINE INDUSTRIES FILED ITS RETURN OF INCOME ON 30.11.2011 DECLARING TOTAL INCOME OF RS. 1 27 75 313/-. THE RETURN OF INCOME W AS SELECTED FOR SCRUTINY. IN THE RETURN OF INCOME THE ASSESSEE REPORTED INTER NATIONAL TRANSACTION WITH IT(TP)A NO. 2379 M 17-M/S DNV GL SE-INDIA BRANCH 2 ITS ASSOCIATED ENTERPRISES (AE). THE ASSESSEE SELEC TED COMPARABLE UNCONTROLLED PRICE (CUP) AS MOST APPROPRIATE METHOD TO CONCLUDE THE TRANSACTION AT ARMS LENGTH. THE ASSESSING OFFICER MADE REFERENCE UNDER SECTION 92CA(1) TO TRANSFER PRICING OFFICER (TPO) F OR COMPUTATION OF ARMS LENGTH PRICE (ALP). THE LEARNED TPO AFTER GRANTING OPPORTUNITY TO THE ASSESSEE SUGGESTED UPWARD OF ADJUSTMENT OF RS. 2 06 71 083/-. CONSEQUENT UPON RECEIPT OF ORDER OF TPO THE ASSESSING OFFICER PASSED DRAFT ASSESSMENT ORDER. THE DRAFT ASSESSMENT ORDER WAS SERVED UPON T HE ASSESSEE. THE ASSESSEE FILED OBJECTION BEFORE THE DRP. BEFORE DRP THE ASSESSEE MADE SUBMISSION THAT ISSUE IS COVERED BY THE DECISION OF TRIBUNAL IN ASSESSEES CASE FOR ASSESSMENT YEAR 2007-08 HOWEVER THE LD. CIT(A) REJECTED THE SUBMISSION OF ASSESSEE BY TAKING VIEW THAT THE DECI SION OF TRIBUNAL IS NOT ACCEPTED BY DEPARTMENT AND APPEAL HAS BEEN FILED BE FORE HONBLE BOMBAY HIGH COURT. ACCORDINGLY THE DRP REJECTED THE OBJEC TION VIDE ITS DIRECTION DATED 18.12.2016. HOWEVER THE ASSESSING OFFICER/TP O WAS DIRECTED TO MAKE ONLY ONE ADDITION OF RS. 20671083. ON RECEIPT OF ORDER OF DRP DATED 18.12.2016 THE ASSESSING OFFICER PASSED THE FINAL ASSESSMENT ORDER DATED 27.01.2017 AND MADE ADDITION OF RS. 20671083/-. THU S AGGRIEVED BY THE ADDITIONS MADE IN PURSUANCE OF ORDER OF DRP THE AS SESSEE HAS FILED THE PRESENT APPEAL BEFORE TRIBUNAL. IT(TP)A NO. 2379 M 17-M/S DNV GL SE-INDIA BRANCH 3 3. WE HAVE HEARD THE SUBMISSION OF LEARNED AUTHORIZED REPRESENTATIVE (AR) OF THE ASSESSEE AND THE LEARNED DEPARTMENTAL REPRESENT ATIVE (DR) FOR THE REVENUE AND PERUSED THE MATERIAL AVAILABLE ON RECOR D. AT THE OUTSET OF HEARING THE LEARNED AR OF THE ASSESSEE SUBMITS THAT THE GROUNDS OF APPEAL ARE COVERED IN FAVOUR OF ASSESSEE BY THE DECISION O F TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2007-08 2010-11 & 201 1-12 WHEREIN IT WAS HELD REVENUE EARNED BY THE HEAD OFFICE SHOULD NOT BE SUBJECT TO TAX IN INDIA. IT WAS SUBMITTED THAT THERE IS NO CHANGE IN THE FAC TS FOR THE YEAR UNDER CONSIDERATION. THE LEARNED AR FOR THE ASSESSEE ALSO PLACED ON RECORD THE COPY OF DECISION OF TRIBUNAL FOR ASSESSMENT YEAR 20 07-08 2010-11 & 2011-12 IN ITA NO. 8975/MUM/2010 3915/MUM/2018 & 3 139/MUM/2018 RESPECTIVELY. 4. ON THE OTHER HAND THE LD. DR FOR THE REVENUE SUPPO RTED THE ORDER OF AUTHORITIES BELOW. 5. WE HAVE NOTED THAT IN APPEAL FOR ASSESSMENT YEAR 20 10-11 IN ITA NO. 3915/MUM/2018 DATED 25.10.2019 THE CO-ORDINATE BEN CH OF TRIBUNAL BY FOLLOWING THE DECISION OF TRIBUNAL IN ASSESSMENT YE AR 2007-08 & 2011-12 PASSED THE FOLLOWING ORDER: 7. HAVING CONSIDERED THE SUBMISSIONS OF THE PARTIE S WE FIND THAT WHILE DECIDING IDENTICAL ISSUE RELATING TO ATTRIBUTION OF INCOME / PROFIT EARNED BY THE HEAD OFFICE TO THE INDIAN BRANCHES IN THE ASSESSMENT YEAR 2007- 08 THE TRIBUNAL IN ITA NO.8975/MUM./2010 DATED 5TH JUNE CANNOT BE TAXED I N INDIA UNLESS THEY ARE ATTRIBUTABLE TO THE INDIAN BRANCHES. AFTER VERIFYIN G THE FACTS ON RECORD THE IT(TP)A NO. 2379 M 17-M/S DNV GL SE-INDIA BRANCH 4 TRIBUNAL RECORDED A FACTUAL FINDING THAT THE INCOME / REVENUE OF THE HEAD OFFICE IS NOT ATTRIBUTABLE TO THE INDIA N BRANCHES HENCE AS PER ARTICLE-7 OF THE INDIA- GERMANY TAX TREATY IT IS NOT TAXABLE IN INDIA. THE SAME VIEW WAS REITERATED BY THE TRIBUNAL WHILE DECIDING REVENUE'S APPEAL IN ASS ESSMENT YEAR 2011-12 VIDE ITA NO.3139/MUM/2018 DATED 29TH MAY 2019. FURTHER IN THE AFORESAID ORDER THE TRIBUNAL HAD ALSO DEALT WITH THE IDENTICAL ISSU E OF TRANSFER PRICING ADJUSTMENT BY UPHOLDING THE DECISION OF THE LEARNED COMMISSION ER (APPEALS) IN DELETING THE ADDITION. ON A CAREFUL EXAMINATION OF THE FACTS INV OLVED IN THE IMPUGNED ASSESSMENT YEAR AS WELL AS ASSESSMENT YEARS 2007-08 AND 2011-12 WHEREIN IDENTICAL ISSUES WERE DECIDED EARLIER BY THE TRIBUN AL WE FIND NO DIFFERENCE. THEREFORE RESPECTFULLY FOLLOWING THE DECISIONS OF THE CO-ORDINATE BENCH IN ASSESSEE'S OWN CASE AS REFERRED TO ABOVE WE UPHOL D THE DECISION OF LEARNED COMMISSIONER (APPEALS) ON THE DISPUTED ISSUE. GROUN DS RAISED ARE DISMISSED. 6. CONSIDERING THE CONSISTENT DECISION OF THE COORDIN ATE BENCH OF TRIBUNAL ON IDENTICAL ISSUES WHEN NO MATERIAL DIFFERENCE IN FA CTS ARE BROUGHT TO OUR NOTICE THEREFORE WE DO NOT FIND ANY MERIT IN MAKI NG ADDITION/ADJUSTMENT ON ACCOUNT OF ATTRIBUTION OF HEAD OFFICER SHARE IN IN VOICES RAISED BY HEAD OFFICE AND HEAD OFFICE SHARE IN INVOICES RAISED BY INDIAN BRANCH. THUS THE GROUNDS OF APPEAL RAISED BY ASSESSEE ARE ALLOWED IN FAVOUR OF ASSESSEE BEING COVERED IN FAVOUR OF ASSESSEE BY THE ORDER OF TRIBUNAL IN E ARLIER YEARS AS STATED ABOVE. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON 11/11/2019. SD/- SD/- SHAMIM YAHYA PAWAN SINGH ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATE: 11.11.2019 SK IT(TP)A NO. 2379 M 17-M/S DNV GL SE-INDIA BRANCH 5 COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. DR K BENCH ITAT MUMBAI 6. GUARD FILE BY ORDER DY./ASST. REGISTRAR ITAT MUMBAI