Avery Dennison (I) Pvt. Ltd, New Delhi v. DCIT, Circle-3(2), New Delhi

ITA 7960/DEL/2019 | 2012-2013
Pronouncement Date: 27-11-2019 | Result: Allowed

Appeal Details

RSA Number 796020114 RSA 2019
Assessee PAN AAACA6163D
Bench Delhi
Appeal Number ITA 7960/DEL/2019
Duration Of Justice 1 month(s) 27 day(s)
Appellant Avery Dennison (I) Pvt. Ltd, New Delhi
Respondent DCIT, Circle-3(2), New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 27-11-2019
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted I1
Tribunal Order Date 27-11-2019
Assessment Year 2012-2013
Appeal Filed On 30-09-2019
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH I-1 : NEW DELHI) BEFORE SHRI N.K. BILLAIYA ACCOUNTANT MEMBER AND SHRI KULDIP SINGH JUDICIAL MEMBER STAY NO.956/DEL/2019 (IN ITA NO.7960/DEL./2019) (ASSESSMENT YEAR : 2012-13) AND ITA NO.7960/DEL./2019 (ASSESSMENT YEAR : 2012-13) STAY NO.957/DEL/2019 (IN ITA NO.7961/DEL./2019) (ASSESSMENT YEAR : 2015-16) AND ITA NO.7961/DEL./2019 (ASSESSMENT YEAR : 2015-16) M/S. AVERY DENNISON (I) PVT. LTD. VS. DCIT CIRCL E 3 (2) P 24 GREEN PARK EXTENSION NEW DELHI. NEW DELHI 110 016. (PAN : AAACA6163D) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VISHAL KALRA ADVOCATE SHRI S.S. TOMAR ADVOCATE REVENUE BY : SHRI SANJAY I. BARA CIT DR SHIR SUBHA KANT SAHU SENIOR DR DATE OF HEARING : 22.10.2019 DATE OF ORDER : 27.11.2019 O R D E R ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 2 PER KULDIP SINGH JUDICIAL MEMBER SINCE COMMON QUESTIONS OF FACTS AND LAW HAVE BEEN R AISED IN BOTH THE AFORESAID APPEALS AND STAY APPLICATIONS THE SAME ARE BEING DISPOSED OFF BY WAY OF CONSOLIDATED ORDER TO AVOID REPETITION OF DISCUSSION. ITA NO.7960/DEL/2019 2. THIS IS SECOND ROUND OF LITIGATION BECAUSE EARLI ER ASSESSMENT ORDER HAS BEEN SET ASIDE BY THE COORDINATE BENCH OF THE TRIBUNAL VIDE ORDER DATED 31.03.2017 TO THE FILE OF AO/TPO T O VERIFY THE ADDITIONAL EVIDENCE BY MAKING OBSERVATIONS AS UNDER :- IN VIEW OF THIS WE SET ASIDE THE APPEAL OF THE ASS ESSEE TO THE FILE OF LD. TPO/AO FOR VERIFYING THE EVIDENCE OF RE NDERING OF THE SERVICES BY THE AE WITH RESPECT OF NATURE OF EACH OF THE SERVICES LISTED IN THE AGREEMENT. THE ASSESSEE IS ALSO FURTHER DIRECTED TO LEAD PROPER AND CREDIBLE EVIDEN CE WITH RESPECT OF NATURE OF SERVICES AND HOW AND WHEN THOS E SERVICES HAVE BEEN RENDERED BY THE AE. 3. THE APPELLANT M/S. AVERY DENNISON (P) PVT. LTD. (HEREINAFTER REFERRED TO AS THE TAXPAYER) BY FILI NG THE PRESENT APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 29.08.2018 PASSED BY THE AO IN CONSONANCE WITH THE ORDERS PASS ED BY THE LD. DRP/TPO UNDER SECTION 144C (1) READ WITH SECTION 25 4/143(3) OF THE ACT QUA THE ASSESSMENT YEAR 2012-13 ON THE GROU NDS INTER ALIA THAT:- ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 3 1. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW THE AO ERRED IN ASSESSING THE INCOME OF THE AP PELLANT UNDER THE NORMAL PROVISIONS OF THE ACT AT INR 270 5 17 350 IN PURSUANCE TO THE DIRECTIONS OF THE DISPUTE RESOL UTION PANEL ('DRP') AS AGAINST THE RETURNED INCOME OF IN R 40 245 490 RETURNED. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW THE ORDER PASSED BY THE LEARNED AS SESSING OFFICER ('AO') IS BAD IN LAW AND VOID AB-INITIO AS THE SAME HAS NOT BEEN PASSED IN CONFIRMATION TO THE PROVISIO NS OF SECTION 144C OF THE ACT. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW THE AO / DRP / TPO ERRED IN MAKING AN ADJUSTMENT TO THE APPELLANT'S INTERNATIONAL TRANSAC TION OF RECEIPT OF INTRA-GROUP SERVICES WITH ITS ASSOCIATED ENTERPRISES ('AES') ALLEGING THAT IT DOES NOT SATIS FY THE ARM'S LENGTH PRINCIPLE ENVISAGED UNDER THE ACT AND THEREBY MAKING AN ADJUSTMENT OF INR 230 271 861 AND IN DOIN G SO HAVE GROSSLY ERRED IN: 3.1. IGNORING THE SPECIFIC DIRECTIONS OF THE HONOU RABLE INCOME TAX APPELLATE TRIBUNAL ('HON'BLE TRIBUNAL') WHEREIN THE NEED AND BENEFIT TEST FOR THE INTRA-GRO UP SERVICES HAD BEEN ACCEPTED AND THE MATTER WAS REFER RED TO THE LD. AO/ LD. TPO ONLY FOR VERIFYING THE RENDITIO N OF THE SERVICES. 3.2. NOT APPRECIATING THE FACT THAT SINCE THE HON' BLE TRIBUNAL HAS ACCEPTED THE NEED AND BENEFIT TEST FOR THE INTRAGROUP SERVICES; THE ARM'S LENGTH PRICE OF THE SAID INTRAGROUP SERVICES CANNOT BE ASSUMED TO BE NIL AND THE ADJUSTMENT MADE OUGHT TO BE DELETED; 3.3. IGNORING THE SPECIFIC EVIDENCES SUCH AS MANAG EMENT REPRESENTATION LETTERS ('MRLS') FROM AES TRAVEL DE TAILS HOTEL DETAILS ETC. WHICH WERE SUBMITTED BY THE APP ELLANT BASED ON THE SPECIFIC REQUEST OF THE LD. TPO DURING THE HEARINGS; 3.4. IGNORING THE DECISIONS OF THE HON'BLE HIGH CO URT AND THE HON'BLE TRIBUNAL FOR EARLIER AS WELL AS SUB SEQUENT ASSESSMENT YEAR(S) WHEREIN TRANSFER PRICING ADJUSTM ENT ON ACCOUNT OF INTRA GROUP SERVICES HAS BEEN DELETED. ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 4 4. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICAT ION OF THE CONTROVERSY AT HAND ARE : M/S. AVERY DENNISON (P) P VT. LTD. THE TAXPAYER IS A SUBSIDIARY OF AVERY DENNISON CORPORAT ION USA AND IS INTO THE MANUFACTURING AND TRADING OF PRESSURE S ENSITIVE ADHESIVE MATERIAL SELF-ADHESIVE PAPER SELF-ADHESIVE FILM TAPE SHEETS TAGS AND LABELS IN ITS TWO SEGMENTS NAMELY PRESSURE SE NSITIVE MATERIAL (PSM) AND RETAIL BRANDING INFORMATION SOLUTIONS (RB IS). 5. IN THE ORIGINAL ORDER DATED 29.01.2016 LD. TPO PROPOSED AN ADJUSTMENT OF RS.23 02 71 861/- ON INTRA GROUP SERV ICES (IGS) BY APPLICATION OF COMPARABLE UNCONTROLLED PRICE (CUP) METHOD HOWEVER ACCEPTED ANOTHER AMOUNT OF RS.5 17 75 129/- AT ARMS LENGTH PRICE (ALP) BY RELYING UPON THE ORDERS PASSE D BY THE LD. DISPUTE RESOLUTION PANEL (DRP) IN AYS 2010-11 & 201 1-12. LD. DRP HAD ALSO UPHELD THE PROPOSED ADDITION OF RS.23 02 71 861/-. HOWEVER COORDINATE BENCH OF THE TRIBUNAL REMITTED THE MATTER BACK TO AO/TPO FOR VERIFYING THE EVIDENCE OF SERVIC ES RENDERED BY THE ASSOCIATED ENTERPRISES (AE). 6. THE ISSUE OF INTRA GROUP SERVICES HAS BEEN COMIN G UP YEAR ON YEAR SINCE AY 2007-08. THE TAXPAYER IN ITS TP A NALYSIS CHARACTERIZED ITSELF AS A ROUTINE MANUFACTURER ASSU MING NORMAL RISKS ASSOCIATED WITH SUCH OPERATION. DURING THE Y EAR UNDER ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 5 ASSESSMENT THE TAXPAYER RETURNED INTERNATIONAL TRA NSACTIONS ENTERED INTO WITH ITS AE IN FORM NO.3CEB AS UNDER :- S.NO. DESCRIPTION OF THE TRANSACTIONS AMOUNT (RS.) 1 PURCHASE OF MATERIAL 1 029 235 500 2 PURCHASE OF TRADED MATERIAL 124 206 127 3 RECEIPT OF SERVICES 282 046 989 4 REIMBURSEMENT OF EXPENSES PAID 16 218 343 5 REIMBURSEMENT OF EXPENSES RECEIVED 32 086 979 6 RENDERING OF SERVICES 48 809 183 7 SALE OF MATERIAL 406 287 680 8 PACKING MATERIAL 58 168 9 PURCHASE OF STORES SPARES 3 675 216 10 COMPUTER SOFTWARE AND LICENCE FEE PAID 57 127 32 1 11 PURCHASE OF FIXED ASSETS 9 068 947 12 REPAIR & MAINTENANCE 3 718 586 13 SELLING COMMISSION PAID 182 539 808 14 REBATE 93 719 213 7. EXCEPT INTERNATIONAL TRANSACTIONS QUA INTRA GROU P SERVICES ALL OTHER INTERNATIONAL TRANSACTIONS HAVE BEEN ACCEPTED AT ARMS LENGTH. THE TAXPAYER RECEIVED SERVICES FROM ITS AE WHICH WE RE NOT BENCHMARKED SEPARATELY. LD. TPO BY RELYING UPON TH E ORDER PASSED BY THE LD. DRP IN AYS 2010-11 AND 2011-12 AP PLIED CUP METHOD FOR BENCHMARKING THE INTERNATIONAL TRANSACTI ONS QUA INTRA GROUP SERVICES AND THEREBY PROPOSED AN ADJUSTMENT O F RS.23 02 71 861/-. 8. THE TAXPAYER CARRIED THE MATTER BEFORE THE LD. D RP BY WAY OF FILING OBJECTIONS WHO HAS UPHELD THE PROPOSED A DDITION OF RS.23 02 71 861/- BY REJECTING THE OBJECTIONS. FEE LING AGGRIEVED THE TAXPAYER HAS COME UP BEFORE THE TRIBUNAL BY WAY OF FILING THE PRESENT APPEAL. ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 6 9. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 10. IT IS THE CASE OF THE TAXPAYER THAT EVEN IN THE SECOND ROUND OF LITIGATION LD. TPO HAS FAILED TO EXAMINE THE PLETH ORA OF EVIDENCE QUA RECEIVING OF MARKETING SUPPORT SERVICES FROM IT S AE IN THE FORM OF PROVISION OF MARKETING MATERIALS SOLUTION SELLING AND CUSTOMIZED PRODUCTS AND SIMILARLY RECEIVED SERVICES FOR OPERATION AND LOGISTIC SUPPORT RECEIVED TECHNICAL ASSISTANCE SERVICES LABOUR LAW & EMPLOYEE RELATIONS FINANCIAL SERVICES ACCOU NTING & ADMINISTRATION SERVICES MANAGEMENT INFORMATION SYS TEMS CORPORATE SUPPORT CENTRE SERVICES AND GVP SERVICES AND STRATEGIC SUPPORT. 11. UNDISPUTEDLY THIS ISSUE IS IDENTICAL TO AYS 2 013-14 & 2014-15 WITH NO CHANGE WHATSOEVER AND THIS FACT HAS BEEN ADMITTED BY THE LD. DRP IN PARA 3.1. LD. TPO AGAIN PROPOSED THE TP ADJUSTMENT OF RS.23 02 71 861/- QUA THE INTRA GR OUP SERVICES RECEIVED BY THE TAXPAYER BY ASCERTAINING THE ARMS LENGTH PRICE AT NIL BY APPLYING THE CUP METHOD ON THE GROUNDS INTER ALIA THAT THERE IS HIGH POSSIBILITY OF DUPLICATION OF THESE SERVICE S AVAILED BY THE TAXPAYER AS THE SERVICES COULD HAVE BEEN PERFORMED BY THE TAXPAYER ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 7 ITSELF; THAT TAXPAYER HAS ALSO NOT BEEN ABLE TO DEM ONSTRATE THAT ANY TANGIBLE GAINS ACHIEVED ARE INDEED THE RESULT OF EF FORTS OF OVERSEAS TEAM; THAT NO EVIDENCE HAS BEEN BROUGHT ON RECORD W HAT SERVICES HAVE BEEN RENDERED BY THE AE; THAT SOME OF THE MAIL S ARE IN RESPECT OF BEER IN INDIA WHICH IS JUST THE INFORMATION AS KED FOR WITH REGARD TO SOME CONNECTIVITY FROM EXECUTIVE VICE PRE SIDENT AND OTHER MAILS ARE VERY GENERAL IN NATURE; THAT THE TA XPAYER HAS NOT SUBMITTED ANY PROOF WITH REGARD TO ACCOUNTING ADMIN ISTRATIVE SERVICES AND MANAGEMENT INFORMATION SYSTEM; THAT EV IDENCE PRODUCED BY THE TAXPAYER DO NOT SHOW THE RENDERING OF SERVICES; THAT THE TAXPAYER HAS NOT FURNISHED ANY DETAIL WITH RESPECT RELEVANT COST WHICH WAS TAKEN INTO CONSIDERATION FOR DETERMI NING THE MARK- UP; THAT NO DOCUMENT WAS FURNISHED TO SUBSTANTIATE THE MARK-UP WHICH WAS APPLIED; THAT THE TAXPAYER ENTERED INTO A N AGREEMENT WITHOUT CARRYING OUT ANY COST BENEFIT ANALYSIS AND HAS SIMPLY MADE THE PAYMENT ON ASKING OF ITS AE; THAT THE TAXPAYER HAS ALSO NOT SUBMITTED ANY EVIDENCE FOR TANGIBLE BENEFITS ACCRUI NG FROM EXPATS; THAT THE TAXPAYER HAS ALSO FAILED TO ESTABLISH AS T O WHEN AND HOW THE VARIOUS SERVICES HAVE BEEN REQUISITIONED FROM THE A E; THAT INTRA GROUP SERVICES ARE SEPARATE CLASS OF TRANSACTIONS A ND HAS TO BE ANALYZED SEPARATELY. ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 8 12. LD. DRP HAS ALSO UPHELD THE PROPOSED ADJUSTMENT MADE BY THE LD. TPO. 13. UNDISPUTEDLY COORDINATE BENCH OF THE TRIBUNAL IN TAXPAYERS OWN CASE FOR AYS 2008-09 2009-10 2010- 11 2011-12 AND 2014-15 ACCEPTED THE INTRA GROUP SERVICES RECEIVED BY THE TAXPAYER AT ARMS LENGTH AND DELETED THE ADJUSTMENT WHICH ORDER HAS NOT BEEN ACCEPTED BY THE REVENUE ON THE GROUND THAT THE SLP FILED BY THE DEPARTMENT IS PENDING BEFORE HONBLE S UPREME COURT ON THESE ISSUES. 14. THE LD. AR FOR THE TAXPAYER CHALLENGED THE FIND INGS RETURNED BY THE LD. TPO THAT NO EVIDENCE HAS BEEN FURNISHED BY THE TAXPAYER TO PROVE THAT SERVICES FROM AE WERE ASKED FOR AND W ERE RENDERED AND DREW OUR ATTENTION TOWARDS PAGES 72 TO 227 OF T HE PAPER BOOK WHEREIN FOR MARKETING PURPOSES PRODUCT BROCHURES H AVE BEEN UNIQUELY DESIGNED AND PROVIDED BY THE AE FOR DEMONS TRATING THE SPECIFIC REQUIREMENTS OF THE CUSTOMERS. THE TAXPAY ER ALSO DREW OUR ATTENTION TOWARDS PAGES 228 TO 230 OF THE PAPER BOOK WHICH ARE EMAILS DEMONSTRATING THE DISCUSSION WITH THE AE FOR DEVELOPING A CUSTOMIZED PRODUCT (CHEAPER DUST REPELLANT ADHESIVE ). THE TAXPAYER ALSO DREW OUR ATTENTION TOWARDS EMAIL AVA ILABLE AT PAGE 232 OF THE PAPER BOOK WHICH IS CORRESPONDENCE WITH ITS AE FOR OBTAINING SAMPLES ETC.. THERE IS ANOTHER PLETHORA OF EVIDENCE ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 9 AVAILABLE AT PAGES 233 TO 264 OF THE PAPER BOOK WH ICH ARE IN THE SHAPE OF EMAILS MAKING REQUEST FOR DIFFERENT SERVIC ES BY THE AE FOR PROVIDING SPECIFIC SERVICES FOR MARKETING SUPPORT S ERVICES. 15. SIMILARLY LD. AR FOR THE TAXPAYER ALSO DREW OU R ATTENTION TOWARDS THE DOCUMENTS IN THE SHAPE OF EMAILS/CORRES PONDENCE AVAILABLE AT PAGES 265 TO 405 OF THE PAPER BOOK FO R REQUIRING AND PROVIDING OPERATION AND LOGISTIC SUPPORT SERVICES B Y THE AE TO THE TAXPAYER. LIKEWISE FOR TECHNICAL ASSISTANCE SERVI CES THE TAXPAYER DREW OUR ATTENTION TOWARDS CORRESPONDENCE AVAILABL E AT PAGES 406 TO 412 OF THE PAPER BOOK WHICH IS REGARDING ISSUE WITH IN3HMBUR CURRENT AND PROPOSED TRAINING COLLEGE AT B ANGALORE DC. FOR AVAILING SERVICES FOR THE PURPOSE OF ESTABL ISHMENT OF HUMAN RESOURCES POLICY PROVIDING TRAINING TO THE I NDIAN HUMAN RESOURCE TEAM ASSISTANCE IN THE EXPANSION OR RESTR UCTURING OF THE ORGANIZATION DEVELOPMENT OF INCENTIVE RETIREMENT AND OTHER FRINGE BENEFIT PROGRAMS QUA LABOUR LAW AND EMPLOYEE RELATI ONS DREW OUR ATTENTION TOWARDS PAGES 413 TO 420 OF THE PAPER BOO K WHICH ARE AGAIN IN THE SHAPE OF EMAILS/SAMPLE EMAIL CORRESPON DENCE WITH THE AES. 16. FOR AVAILING FINANCIAL SERVICES ACCOUNTING AND ADMINISTRATION SERVICES MANAGEMENT INFORMATION SER VICES AND CORPORATE SUPPORT CENTRE SERVICES AGAIN LD. AR FOR THE TAXPAYER ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 10 BROUGHT ON RECORD FROM PAGES 421 TO 547 OF THE PAPE R BOOK IN THE FORM OF EMAILS AND EMAIL CORRESPONDENCE WITH ITS AE SHOWING REQUISITION OF SERVICES BY THE TAXPAYER AND PROVIDI NG OF SUCH SERVICES BY THE AE TO THE TAXPAYER IN THE PSM SEGME NT. 17. SIMILARLY IN THE RBIS SEGMENT THE TAXPAYER DR EW OUR ATTENTION TOWARDS EMAILS/EMAIL CORRESPONDENCE SHOWI NG RECEIPT OF ACCOUNTING AND ADMINISTRATION SUPPORT LABOUR LAW A ND ASSISTANCE IN INTERNAL PLAN FORMULATION AND ANALYSIS ETC. AVAILA BLE AT PAGES 548 TO 672 OF THE PAPER BOOK. 18. WHEN WE EXAMINE AFORESAID EVIDENCE BROUGHT ON R ECORD BY THE TAXPAYER FOR MAKING REQUISITION AND AVAILING OF INTRA GROUP SERVICES UNDER NUMEROUS HEADS LIKE MARKETING SUPPOR T SERVICES OPERATION AND LOGISTIC SUPPORT ETC. DULY PRODUCED BEFORE THE TPO THERE IS NO WHISPER OF ANY OF AFORESAID EVIDENCES D ISCUSSED OR DISCARDED ON MERITS TO DECLINE THE CLAIM OF THE TAX PAYER. RATHER LD. TPO HAS PROCEEDED ON THE BASIS OF MERE PRESUMPTIONS AND SURMISES INTER ALIA THAT THERE IS HIGH POSSIBILITY OF DUPLICATION OF THE SERVICES AND THAT THERE IS GENERAL OBSERVATION THAT THE TAXPAYER HAS NOT BEEN ABLE TO DEMONSTRATE AY TANGIBLE GAINS ACHIEVED AND THAT THESE EVIDENCES PRODUCED BY THE TAXPAYER DO NO T SHOW RENDERING OF SERVICES ETC. . ALL THESE OBSERVATIONS ARE GENERAL IN NATURE WITHOUT SPECIFICALLY DEALING EACH AND EVERY DOCUMENT RELIED ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 11 UPON BY THE TAXPAYER. MOREOVER WHEN WE SPECIFICAL LY EXAMINE EMAILS/CORRESPONDENCE WITH AE AVAILABLE AT PAGES 2 28 AND 229 OF THE PAPER BOOK TAXPAYER HAS SPECIFICALLY ASKED FOR DUST REPELLANT COATING AND THEREAFTER ITS AE HAS REPLIED THAT THEY DO NOT HAVE A PRODUCT BUT THEY DO HAVE A PROTOTYPE. IT SHOWS THA T THE REQUISITION OF SERVICES AND PROVIDING THE SAME BY AE CANNOT BE BRUSHED ASIDE JUST ON THE BASIS OF PRESUMPTIONS AND SURMISES BY T HE TPO. MOREOVER WHEN IN THE EARLIER YEARS AND IN THE PREC EDING YEARS IDENTICAL SERVICES ARE BEING RENDERED/AVAILED OF BY THE TAXPAYER FROM ITS AE UNDER THE SAME AGREEMENT THE ISSUE CAN NOT BE PUT UNDER THE CARPET MERELY ON THE BASIS OF PRESUMPTION S AND SURMISES BY MAKING GENERAL REASONING. 19. MOREOVER WHEN WE EXAMINE PARA 1.65 AT PAGE 981 OF THE PAPER BOOK WHICH IS REPLY TO THE SHOW-CAUSE NOTICE DATED 13.01.2016 ISSUED BY THE TPO AND PAGE 24 OF THE PAP ER BOOK SUBMITTING FURTHER EVIDENCE CALLED FOR BY THE LD. T PO IT IS PROVED ON RECORD THAT THE TAXPAYER HAS EXPLAINED AMOUNT OF PAYMENT MADE FOR EACH OF SUCH SERVICES RENDERED BY THE AES. MOR EOVER IT IS UNDISPUTED FACT THAT SALE OF THE TAXPAYER HAS INCRE ASED YEAR ON YEAR. EVEN OTHERWISE WHEN EVERYTHING IN THE COMMON AGREE MENT HAS BEEN ADMITTED BY THE REVENUE IN THE PRECEDING AS WE LL AS SUCCEEDING YEAR OR RENDITION HAS NOT BEEN DISPUTED THE PLETHORA OF ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 12 EVIDENCE BROUGHT ON RECORD BY THE TAXPAYER CANNOT B E IGNORED JUST LIKE THAT BY THE LD. TPO ON THE BASIS OF HIS OWN GE NERAL INFORMATION. 20. LD. DR FOR THE REVENUE TO REPEL THE ARGUMENTS A DDRESSED BY THE LD. AR FOR THE TAXPAYER CONTENDED THAT EXPATS H AVE BEEN COMING TO INDIA FREQUENTLY AND ALL THE EVIDENCES HA VE BEEN GIVEN ARE GENERAL IN NATURE AND DIRECTIONS HAVE BEEN GIVE N FROM THE HUB AND FURTHER CONTENDED THAT THE EVIDENCE GIVEN AFTER WARDS NEED TO BE EXAMINED. 21. HOWEVER IT IS UNDISPUTED FACT THAT EVEN IF THE DIRECTIONS HAVE BEEN GIVEN FROM THE HUB THE HUB WILL ALLOCATE COST TO ITS VARIOUS AES I.E. COST PLUS 5% MARK-UP BUT THE LD. T PO HAS NOT UTTER A SINGLE WORD ABOUT THESE EMAILS IN HIS ORDER RATHE R PROCEEDED ON THE BASIS OF GENERAL INFORMATION. 22. MOREOVER HONBLE DELHI HIGH COURT IN TAXPAYERS OWN CASE IN ITA 662/2019 FOR AY 2014-15 ORDER DATED 23.07.20 19 CONFIRMED THE FINDINGS RETURNED BY THE TRIBUNAL THA T IN AYS 2010- 11 TO 2012-13 THE LD. DRP ACCEPTED THE TAXPAYERS DETERMINATION OF ALP WITH REGARD TO TWO INTRA GROUP SERVICES RECE IVED BY THE TAXPAYER VIZ. TICKETING HUB AND VIPFS. 23. LD. DR FOR THE REVENUE DREW OUR ATTENTION TOWAR DS PAGE 14 OF THE ORDER DATED 31.03.2017 PASSED BY THE TRIBUNA L IN THE PRESENT ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 13 CASE IN THE FIRST ROUND OF LITIGATION WHEREIN THE TRIBUNAL RECORDED THE FACT THAT THE EVIDENCES PRODUCED ARE APPARENTLY VERY GENERAL IN NATURE AND DO NOT SHOW THE RENDERING OF SERVICES. WE ARE OF THE CONSIDERED VIEW THAT THESE FINDINGS BY THE TRIBUNAL ARE ALSO GENERAL IN NATURE AND THAT IS WHY THE TRIBUNAL HAS REQUIRED THE TPO TO RE- EXAMINE ALL THE EVIDENCES TO REACH AT THE LOGICAL C ONCLUSION. HAD THERE BEEN CONCLUSIVE FINDINGS OF THE TRIBUNAL THAT THE EVIDENCES PRODUCED ARE GENERAL IN NATURE AND DO NOT SHOW REND ERING OF SERVICES THE CASE WOULD NEVER HAVE BEEN REMANDED BACK TO THE TPO/AO FOR REEXAMINING THESE EVIDENCES. 24. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE WE AR E OF THE CONSIDERED VIEW THAT THE MATTER IS AGAIN REQUIRED T O BE REMANDED BACK TO THE LD. TPO/AO TO EXAMINE AFRESH THE ENTIRE EVIDENCE PRODUCED BY THE TAXPAYER IN THE FIRST ROUND AS WELL AS SECOND ROUND OF LITIGATION REFERRED TO IN THE PRECEDING PARAS IN THE LIGHT OF THE DECISION RENDERED BY THE COORDINATE BENCH OF THE TR IBUNAL IN TAXPAYERS OWN CASE AS WELL AS HONBLE DELHI HIGH C OURT IN AYS 2008-09 2010-11 2011-12 2013-14 AND 2014-15. CONSEQUENTLY THE APPEAL FILED BY THE TAXPAYER BEING ITA NO.7960/ DEL/2019 IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 14 ITA NO.7961/DEL/2019 25. UNDISPUTEDLY FACTS OF THIS CASE ARE IDENTICAL TO AYS 2010- 11 2011-12 AND 2012-13 AS RECORDED BY THE LD. DRP IN PARA 3.8 (V) EXTRACTED FOR READY PERUSAL AS UNDER :- V. HOWEVER IT IS OBSERVED THAT ON SIMILAR FACTS IN AY 2010-11. 2011-12 AND 2012-13 THE DRP DELETED TH E ADJUSTMENT IN RESPECT OF TICKETING HUB AND VIPFS AN D UPHELD THE REMAINING ADJUSTMENT. IN AY 2012-13 TO A Y 2014-15 THE TPO HAS MADE THE ADJUSTMENT IN ACCORDANCE WITH THE DIRECTIONS OF THE DRP IN THE PRECEDING YEARS AND HIMSELF ACCEPTED THESE TWO HEAD S AS AT ARMS LENGTH. IN THE ORDER FOR AY 2015-16 TH E TPO HAS NEITHER FOLLOWED THE DIRECTIONS OF DRP OR HIS OWN ORDER IN EARLIER YEARS NOR HAS BOTHERED TO JUS TIFY WHY THESE AMOUNTS HAVE BEEN INCLUDED IN THE ADJUSTMENT. THIS YEAR THE TPO HAS DETERMINED ITS A LP AT NIL AND CONSEQUENTLY MADE AN ADJUSTMENT OF RS.57 26 15 601 OF THE WHOLE AMOUNT. THE AMOUNT OF INR 4 61 70 381 ON TICKETING HUB AND INR 5 62 98 85 8 ON ACCOUNT OF VIPFS HAS DISCUSSED BY THE TPO SEPARATELY. 26. PERUSAL OF THE TP ORDER PARTICULARLY PARA 4.7 A T PAGE 38 SHOWS THAT THE FINDINGS RETURNED BY THE TPO ARE MIR ROR IMAGE OF FINDINGS OF THE TPO IN AY 2012-13 WHEREIN HE HAS AP PLIED BENEFIT TEST AND PROCEEDED TO CONCLUDE THAT NONE OF THE BEN EFITS ARE TANGIBLE OR REAL. A MERE FAADE HAS BEEN RAISED TO GIVE THE IMPRESSION THAT SOME FINAL BENEFIT HAS BEEN PASSED TO THE TAXPAYER WHICH IS NOT ACTUALLY THE CASE; THAT THE TAXPAYER H AS NOT GIVEN ANY EVIDENCE AS TO THE COST BENEFIT ANALYSIS; THAT NO D OCUMENTATION TO SUPPORT HIS CLAIM FOR THE RECEIPT OF HIS SERVICES A ND THAT ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 15 BENCHMARKING DONE BY THE TAXPAYER IS NOT IN ACCORDA NCE WITH THE LAW THEREFORE CUP METHOD IS TO BE APPLIED IN THIS CASE. AT THE SAME TIME THE LD. AR FOR THE TAXPAYER BROUGHT ON R ECORD THE FACT THAT PLETHORA OF EVIDENCE HAS BEEN PRODUCED BEFORE THE TPO TO PROVE THE MARKETING SUPPORT SERVICES FROM PAGES 267 TO 532 WHICH ARE IN THE FORM OF PRODUCT BROCHURE DURABLES A4 SA MPLE DISTRIBUTION HEAT TRANSFER LABELS PRODUCT FINDER GLOBAL EXIDE MATERIAL BWS762 WITH EMAIL CORRESPONDENCES ETC. WHE REBY AES HAVE PROVIDED INPUTS/SOLUTIONS TO THE TAXPAYER QUA VARIOUS PRODUCTS. SIMILARLY FOR OPERATIONS LOGISTICS AND TECHNICAL SUPPORT SERVICES THE TAXPAYER PROVED ON RECORD THAT NUMERO US DOCUMENTS AVAILABLE AT PAGES 533 TO 555 WERE PRODUCED BEFORE THE TPO WHICH ARE AGAIN IN THE FORM OF DESIGN REVIEW NOTES IN5 T OP COATING CERTIFICATION FOR S692NP ETC. AND EMAILS CORRESPOND ENCE SHOWING DISCUSSIONS/CALLS/MEETINGS CONDUCTED BY THE AES WIT H THE LOGISTICS TEAM OF THE TAXPAYER AND EMAILS ESTABLISHING THE NE CESSARY CERTIFICATION THAT MAY BE REQUIRED FOR NEW PRODUCTS TO BE LAUNCHED IN THE INDIAN MARKET ETC.. 27. SIMILARLY FOR OPERATION LOGISTICS AND TECHNIC AL SUPPORT SERVICES THE TAXPAYER PROVED THAT DOCUMENTS AVAILA BLE AT PAGES 556 TO 598 OF THE PAPER BOOK AGAIN IN THE FORM OF P URCHASE AGREEMENT POLYTYPE C11 QUOTATION AFE FOR 1.52 MET ER GRAPHICS ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 16 DIE ETC. AND EMAILS CORRESPONDENCE WITH THE TAXPAYE R AND AES PROVING THE FACT THAT SERVICES ARE BEING PROVIDED. IN CASE OF FINANCE ACCOUNTING AND MANAGEMENT INFORMATION SYST EM SERVICES LABOUR LAW AND EMPLOYEES RELATION CORPORATE SERVIC E CENTRE SERVICES INFORMATION TECHNOLOGY SERVICES CORPORAT E SERVICES CENTRE SERVICES GVP SERVICES DOCUMENTS FROM PAGES 599 TO 1332 OF THE PAPER BOOK ARE PROVED TO BE PRODUCED BEFORE TPO FOR PERUSAL WHICH ARE AGAIN EMAIL CORRESPONDENCE ETC. B ETWEEN THE TAXPAYER AND ITS AES TO PROVE THE FACT THAT SERVICE S HAVE BEEN RENDERED. 28. HOWEVER TPO/DRP WITH PRE-MEDITATED MIND HAS PR OCEEDED ON THE BASIS OF GENERAL OBSERVATIONS PRESUMPTIONS AND SURMISES AND MORE SPECIFICALLY FOLLOWED AYS 2010-11 2011- 12 AND 2012-13. SO IN THESE CIRCUMSTANCES THE ISSUE IS REQUIRED TO BE REMANDED BACK TO THE TPO TO DECIDE AFRESH AFTER APP RECIATING THE EVIDENCE THREADBARE PRODUCED BY THE TAXPAYER IN VIE W OF THE FINDINGS RETURNED IN THE PRECEDING PARAS AS WELL AS IN VIEW OF THE FINDINGS RETURNED IN AY 2012-13 BY THE BENCH. CONS EQUENTLY THE APPEAL FILED BY THE TAXPAYER BEING ITA NO.7961/DEL/ 2019 IS ALLOWED FOR STATISTICAL PURPOSES. 29. HOWEVER WE HAVE HOPE AND FAITH THAT THE LD. TP O/AO WOULD BE SENSITIVE ENOUGH TO BEAR IN MIND THAT THE SPECIFIC ISSUE ITA NO.7960 & 7961/DEL/2019 STAY NOS.956 & 957/DEL/2019 17 OTHERWISE REQUIRED TO BE DEALT WITH ON THE BASIS OF EVIDENCE SHOULD NOT BE AGAIN DECIDED ON THE BASIS OF GENERAL OBSERV ATIONS PRESUMPTIONS AND SURMISES. STAY NO.956/DEL/2019 (IN ITA NO.7960/DEL./2019) (ASSESSMENT YEAR : 2012-13) AND STAY NO.957/DEL/2019 (IN ITA NO.7961/DEL./2019) (ASSESSMENT YEAR : 2015-16) 30. SINCE THE APPEALS BEARING ITA NOS.7960/DEL/2019 & 7961/DEL/2019 ON THE BASIS OF WHICH THE PRESENT ST AY APPLICATIONS ARE FILED HAS BEEN DISPOSED AS AFORESAID THE STAY APPLICATIONS STAND DISMISSED HAVING BEEN BECOME INFRUCTUOUS. ORDER PRONOUNCED IN OPEN COURT ON THIS 27 TH DAY OF NOVEMBER 2019. SD/- SD/- (N.K. BILLAIYA) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 27 TH DAY OF NOVEMBER 2019 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A) 5.CIT(ITAT) NEW DELHI. AR ITAT NEW DELHI.