GMM Pfaudler Ltd.,, Ahmedabad v. The Dy.CIT., Circle-2(1)(1),, Ahmedabad

MA 225/AHD/2019 | 2010-2011
Pronouncement Date: 04-05-2021 | Result: Allowed

Appeal Details

RSA Number 22520524 RSA 2019
Assessee PAN AABCG0563A
Bench Ahmedabad
Appeal Number MA 225/AHD/2019
Duration Of Justice 1 year(s) 9 month(s) 19 day(s)
Appellant GMM Pfaudler Ltd.,, Ahmedabad
Respondent The Dy.CIT., Circle-2(1)(1),, Ahmedabad
Appeal Type Miscellaneous Application
Pronouncement Date 04-05-2021
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted D
Tribunal Order Date 04-05-2021
Assessment Year 2010-2011
Appeal Filed On 15-07-2019
Judgment Text
PAGE 1 OF 6 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH AHMEDABAD (CONDUCTED THROUGH VIRTUAL COURT) BEFORE SHRI WASEEM AHMED ACCOUNTANT MEMBER AND MS. MADHUMITA ROY JUDICIAL MEMBER M.A NO.225/AHD/2019 IN ./ ITA NOS.951/AHD/2015 AND M.A NO.226/AHD/2019 IN ./ ITA NO.1370/AHD/2015 / ASSTT. YEAR: 2010-2011 GMM PFAUDLER LTD. 3 RD FLOOR B JADAV CHAMBERS ASHRAM ROAD AHMEDABAD-380009. PAN: AABCG0563A VS. D.C.I.T. CIRCLE-2(1)(1) AHMEDABAD. (APPLICANT) (RESPONDENT) REVENUE BY : SHRI S.N. SOPARKAR SR. ADVOCATE WITH SHRI PARIN SHAH A.R ASSESSEE BY : SHRI S.S. SHUKLA SR.DR / DATE OF HEARING : 16/04/2021 / DATE OF PRONOUNCEMENT: 04/05/2021 / O R D E R PER WASEEM AHMED ACCOUNTANT MEMBER: THESE TWO MISCELLANEOUS APPLICATION HAVE BEEN PREFERRED BY THE ASSESSEE AGAINST THE ITAT ORDERS IN ITA NOS. 951 & 1370/AHD/2015 DATED 04/03/2019 FOR THE ASSESSMENT YEAR 2010-2011. THE ASSESSEE BY WAY THIS MISCELLANEOUS M.A NOS. 225-226/AHD/2019 IN ITA NOS.951 & 1370/AHD/2015 ASSTT. YEAR 2010-11 PAGE 2 OF 6 APPLICATION IS SEEKING TO RECALL THE ORDER OF THE ITAT AS THERE IS A MISTAKE APPARENT FROM RECORD. FIRST WE TAKE M.A. NO.226/AHD/2019 (IN ITA NO.1370/AHD/2017) FOR A.Y. 2010-11. 2. THE ASSESSMENT WAS FRAMED UNDER SECTION 143(3) OF THE ACT VIDE ORDER DATED 28/03/2013 BY THE AO AFTER MAKING CERTAIN ADDITIONS INCLUDING THE UPWARD ADJUSTMENTS WITH RESPECT TO INTERNATIONAL TRANSACTIONS. THE UPWARD ADJUSTMENTS WITH RESPECT TO INTERNATIONAL TRANSACTIONS MADE BY THE AO CAME TO BE DELETED BY THE LEARNED CIT (A). ACCORDINGLY THE REVENUE CAME IN APPEAL BEFORE US. HOWEVER THE TRIBUNAL SET ASIDE THE ISSUE TO THE FILE OF THE LEARNED CIT (A) WITH THE DIRECTION TO ADJUDICATE SO AS TO WHETHER THE REFERENCE TO THE TPO FOR THE DETERMINATION OF ALP WAS REQUIRED TO BE MADE IN PURSUANCE TO CBDT CIRCULAR NO. 3 OF 2003 DATED 20 TH MAY 2003 VIDE ORDER DATED 04/03/2019 AS THE VALUE OF THE INTERNATIONAL TRANSACTION WAS LESS THAN 15 CRORES. THEREAFTER THE ASSESSEE FILED THE INSTANT MISCELLANEOUS APPLICATION POINTING OUT CERTAIN MISTAKES AND PROBLEMS IN THE ORDER OF ITAT WHICH WERE APPARENT ON THE FACE OF THE RECORD. 3. IN THE MISCELLANEOUS APPLICATION THE LEARNED AR FAIRLY CONCEDED THAT THERE WAS NO REFERENCE MADE BY THE AO TO THE TPO FOR THE DETERMINATION OF THE ALP WITH RESPECT TO THE INTERNATIONAL TRANSACTION. HOWEVER AT THE TIME OF HEARING BEFORE THE ITAT DATED 5-12-2018 HE INADVERTENTLY SUBMITTED TO THE BENCH THAT THERE WAS NO NEED TO MAKE ANY REFERENCE TO THE TPO FOR THE DETERMINATION OF THE ALP AS THE TOTAL VALUE OF THE INTERNATIONAL TRANSACTION WAS LESS THAN RS. 15 CRORES. HOWEVER LATER ON HE REALIZED MISTAKE THAT THE AO HAS NOT MADE ANY REFERENCE TO THE TPO FOR THE DETERMINATION OF THE ALP RATHER THE AO HIMSELF HAS DETERMINED THE ALP WITH RESPECT TO THE INTERNATIONAL TRANSACTIONS CARRIED OUT BY THE ASSESSEE. HOWEVER THE BENCH BELIEVING ON THE STATEMENT MADE BY HIM HAS SET ASIDE THE ISSUE TO THE FILE OF THE LD. CIT-A WITH THE DIRECTION TO ADJUDICATE SO AS TO WHETHER THE REFERENCE TO THE TPO FOR M.A NOS. 225-226/AHD/2019 IN ITA NOS.951 & 1370/AHD/2015 ASSTT. YEAR 2010-11 PAGE 3 OF 6 THE DETERMINATION OF ALP WAS REQUIRED TO BE MADE IN PURSUANCE TO CBDT CIRCULAR NO. 3 OF 2003 DATED 20 TH MAY 2003 VIDE ORDER DATED 4-3-2019. ACCORDINGLY THE LEARNED AR CONTENDED THAT THE DIRECTION ISSUED BY THE BENCH IS CONTRARY TO THE FACTS AVAILABLE ON RECORD WHICH CONSTITUTE A MISTAKE APPARENT ON RECORD. HENCE THE LEARNED AR REQUESTED FOR THE RECTIFICATION OF THE MISTAKE BY RECALLING THE GROUND NO. 1 RAISED BY THE REVENUE AND ALLOW HIM TO RAISE HIS ARGUMENT ON MERIT. 4. ON THE OTHER HAND THE LEARNED DR FAIRLY AGREED TO THE PROPOSITION SUGGESTED BY THE LEARNED AR FOR THE ASSESSEE. 5. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE PROVISIONS OF SECTION 254(2) OF THE ACT PROVIDES AUTHORITY TO THE TRIBUNAL TO RECTIFY THE MISTAKES APPARENT FROM RECORD COMMITTED BY IT WHILE RENDERING THE JUSTICE. IT IS THE BASIC PRINCIPLE OF JURISPRUDENCE THAT IF ANY MISTAKE IS COMMITTED BY THE TRIBUNAL IT NEEDS TO BE RECTIFIED AS NO ONE SHOULD SUFFER ON ACCOUNT OF THE MISTAKE COMMITTED BY THE COURT. EVEN THE RULES OF PROCEDURES AND TECHNICALITIES SHOULD NOT COME IN THE WAY IN RENDERING JUSTICE TO THE PARTIES BY CORRECTING THE MISTAKE COMMITTED BY THE TRIBUNAL. 5.1 IN THE INSTANT CASE THE ITAT HAS WRONGLY ASSUMED THAT THE REFERENCE TO THE TPO BY THE AO FOR DECIDING THE ARM LENGTH PRICE WITH RESPECT TO THE INTERNATIONAL TRANSACTIONS WAS NOT VALID AS THE QUANTUM INVOLVED WAS LESS THAN 15 CRORES. HOWEVER THIS ASSUMPTION OF THE ITAT WAS BASED ON THE STATEMENT MADE BY THE LEARNED COUNSEL FOR THE ASSESSEE. THE MISTAKE COMMITTED BY THE LEARNED COUNSEL FOR THE ASSESSEE WAS ALSO ADMITTED AT THE TIME OF HEARING. 5.2 IT IS ALSO IMPORTANT TO NOTE THAT THE LEARNED DR ALSO AT THE TIME OF HEARING HAS NOT CONTROVERTED THE PROPOSITION CANVASSED BY THE LEARNED AR FOR THE ASSESSEE. RATHER THE LEARNED DR WAS AGREED TO THE PROPOSITION SUGGESTED BY THE LEARNED AR AT THE TIME OF HEARING. M.A NOS. 225-226/AHD/2019 IN ITA NOS.951 & 1370/AHD/2015 ASSTT. YEAR 2010-11 PAGE 4 OF 6 5.3 BE THAT AS IT MAY BE IT IS NOT MATERIAL HOW THE MISTAKE WAS COMMITTED BY THE TRIBUNAL. WHAT IS MATERIAL IS THE MISTAKE COMMITTED BY THE TRIBUNAL IN DECIDING THE ISSUE ON HAND THOUGH ON THE WRONG STATEMENT OF THE LEARNED COUNSEL FOR THE ASSESSEE. IN OTHER WORDS THE TRIBUNAL HAS WRONGLY ASSUMED THE FACT THAT THE AO HAS ACCIDENTALLY REFERRED THE MATTER TO THE TPO FOR THE DETERMINATION OF ARM LENGTH PRICE WHEREAS THERE WAS NO SUCH REFERENCE MADE BY THE AO. IT IS THE SETTLED LAW THAT THE WRONG ASSUMPTION OF FACTS WHICH ARE CRUCIAL TO DECIDE THE ISSUE WILL CONSTITUTE MISTAKE APPARENT FROM RECORD. ACCORDINGLY WE RECALL THE GROUND NO. 1 RAISED BY THE REVENUE FOR FRESH ADJUDICATION AS PER THE PROVISIONS OF LAW. THE APPEAL MAY BE LISTED FOR HEARING ON 26 JULY 2021 . AS THE DATE OF HEARING HAS BEEN PRONOUNCED IN THE OPEN COURT THERE IS NO NEED TO SEND SEPARATE NOTICE OF HEARING TO EITHER PARTY. HENCE THE MA FILED BY THE ASSESSEE IS ALLOWED. 5.4 IN THE RESULT THE MA FILED BY THE ASSESSEE IS ALLOWED. COMING TO THE M.A NO. 225/AHD/2019 (IN ITA NO.951/AHD/15) FOR A.Y.2010-11. 6. AS THE ISSUE IN GROUND NO. 1 RAISED BY THE REVENUE IN ITS APPEAL WAS SET ASIDE TO THE FILE OF THE LEARNED CIT (A) FOR FRESH ADJUDICATION THE ITAT WAS ALSO PLEASED TO SET ASIDE THE ISSUE RAISED BY THE ASSESSEE RAISED IN ITS APPEAL IN GROUND NUMBER 3 TO 6 BEARING ITA NO. 951/AHD/2015 TO THE LEARNED CIT (A) FOR FRESH ADJUDICATION. IT WAS OBSERVED BY THE ITAT THAT THE ISSUES RAISED BY THE ASSESSEE IN GROUND NO. 3 TO 6 ARE RELATED TO TP PROVISIONS. ACCORDINGLY THE ITAT WAS OF THE VIEW THAT AS THE VALIDITY OF REFERENCE TO TPO IS TO BE ADJUDICATED BY THE LEARNED CIT (A) IN TERMS OF THE DIRECTION PROVIDED IN THE APPEAL OF THE REVENUE BEARING NUMBER 1370/AHD/2015 IT WILL BE PREMATURE TO DEAL WITH THE GRIEVANCES OF THE ASSESSEE AT THIS STAGE. THUS THE ISSUES RAISED BY THE ASSESSEE IN GROUND NOS. 3 TO 6 WERE ALSO SET ASIDE TO THE FILE OF THE LEARNED CIT (A) FOR FRESH ADJUDICATION. M.A NOS. 225-226/AHD/2019 IN ITA NOS.951 & 1370/AHD/2015 ASSTT. YEAR 2010-11 PAGE 5 OF 6 7. THE LEARNED AR BEFORE US SUBMITTED THAT AS THE GROUND NO. 1 RAISED BY THE REVENUE IN ITA NO. 1370/AHD/2015 NEEDS TO BE ADJUDICATED ON MERIT AS PRAYED IN THE MA BEARING NO. 226/AHD/2019. ACCORDINGLY AS PER THE LEARNED AR IF GROUND NO. 1 RAISED BY THE REVENUE IN ITA NO. 1370/AHD/2015 IS RECALLED FOR FRESH ADJUDICATION THEN THE GROUNDS RAISED BY THE ASSESSEE BEARING NUMBERS 3 TO 6 SHOULD ALSO BE RECALLED FOR FRESH ADJUDICATION IN CONSEQUENCE THEREOF. 7.1 THE LEARNED AR AT THE TIME OF HEARING ALSO REQUESTED THAT THE ISSUE RAISED BY THE ASSESSEE IN GROUND NO. 2 (D) SHOULD ALSO BE RECALLED AS IT IS RELATED TO THE TRANSFER PRICING PROVISIONS. IT IS BECAUSE ALL THE ISSUES RELATED TO THE TRANSFER PRICING PROVISIONS SHOULD BE RECALLED FOR FRESH ADJUDICATION AS PER THE PROVISIONS OF LAW. 8. ON THE OTHER HAND THE LEARNED DR RAISED NO OBJECTION IF GROUNDS OF APPEAL OF THE ASSESSEE BEARING NUMBERS 2 TO 6 ARE RECALLED FOR FRESH ADJUDICATION AS PER THE PROVISIONS OF LAW. AS SUCH THE LEARNED DR FAIRLY AGREED TO THE PREPOSITION CANVASSED BY THE LEARNED AR FOR THE ASSESSEE. 9. HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. ADMITTEDLY THE ISSUES RAISED BY THE ASSESSEE IN GROUND NO. 3 TO 6 WERE NOT DECIDED BY THE ITAT. AS PER THE ITAT THE OUTCOME OF THESE GROUNDS WAS DEPENDING UPON THE GROUND OF APPEAL RAISED BY THE REVENUE IN ITS APPEAL BEARING NO. 1370/AHD/2015 WHICH WAS SET ASIDE TO THE FILE OF THE LEARNED CIT (A). ACCORDINGLY THESE GROUNDS OF APPEAL IN THE ASSESSEES APPEAL WERE ALSO SET ASIDE TO THE FILE OF THE LEARNED CIT (A) FOR FRESH ADJUDICATION. 9.1 UNDISPUTEDLY THE GROUND NO. 1 RAISED BY THE REVENUE IN ITS APPEAL BEARING NO. 1370/AHD/2015 HAS BEEN RECALLED BY US VIDE PARAGRAPH NUMBER 5 OF THIS ORDER WHICH IS ELABORATED ABOVE. ACCORDINGLY WE ARE INCLINED TO RECALL THE GROUNDS BEARING M.A NOS. 225-226/AHD/2019 IN ITA NOS.951 & 1370/AHD/2015 ASSTT. YEAR 2010-11 PAGE 6 OF 6 NOS. 3 TO 6 RAISED BY THE ASSESSEE IN ITS APPEAL FOR FRESH ADJUDICATION AS PER THE PROVISIONS OF LAW. 9.2 IT IS ALSO SIGNIFICANT TO NOTE THAT THE ISSUE RAISED BY THE ASSESSEE IN GROUND NO. 2 ALSO RELATES TO THE PROVISIONS OF TRANSFER PRICING AND ALL THE ISSUES RELATED TO THE TRANSFER PRICING HAVE ALREADY BEEN RECALLED FOR THE REASONS AS DISCUSSED ABOVE. ACCORDINGLY IN THE INTEREST OF JUSTICE AND FAIR PLAY WE ARE ALSO INCLINED TO RECALL THE GROUND NO. 2 TO 6 RAISED BY THE ASSESSEE FOR FRESH ADJUDICATION AS PER THE PROVISIONS OF LAW. THE APPEAL MAY BE LISTED FOR HEARING ON 26 JULY 2021 . AS THE DATE OF HEARING HAS BEEN PRONOUNCED IN THE OPEN COURT THERE IS NO NEED TO SEND SEPARATE NOTICE OF HEARING TO EITHER PARTY. HENCE THE MA FILED BY THE ASSESSEE IS ALLOWED. 9.3 IN THE RESULT THE MA FILED BY THE ASSESSEE IS ALLOWED. 10. IN THE COMBINED RESULT BOTH THE MAS FILED BY THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE COURT ON 04/05/2021 AT AHMEDABAD. SD/- SD/- (MADHUMITA ROY) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTAN T MEMBER (TRUE COPY) AHMEDABAD; DATED 04/05/2021 MANISH