Income Tax Appellate Tribunal - Chennai
Bengal Tiger Line India Private ... vs Dcit Corporate Circle 1 (2), Chennai on 28 October, 2019
आयकर अपील य अ धकरण, 'डी' यायपीठ, चे नई
IN THE INCOME TAX APPELLATE TRIBUNAL , 'D' BENCH, CHENNAI
ी ध ु व
ु आर. एल रे डी, या यक सद यएवं ी एस जयरामन, लेखासद य के सम$
BEFORE SHRI DUVVURU RL REDDY, JUDICIAL MEMBER AND
SHRI S. JAYARAMAN, ACCOUNTANT MEMBER
आयकरअपीलसं./I.T.(TP)A.No.22/CHNY/2018
( नधा रणवष / Assessment Year: 2013-14)
M/s. Bengal Tiger Line India Pvt. Vs The Deputy Commissioner
Ltd., of Income Tax,
Indian Chamber Building, Annexe, Corporate Circle 1(2),
No.6, Esplanade, Chennai - 600 Chennai.
108.
PAN: AAACB 1369A
(अपीलाथ /Appellant) ( यथ /Respondent)
अपीलाथ क ओरसे/ Appellant by : ShriS.P. Chidambaram, Advocate
यथ क ओरसे/Respondent by : Dr.M.SrinivasaRao, JCIT
सन
ु वाईक तार ख/Date of hear ing : 30.07.2019
घोषणाक तार ख /Date of Pronouncem ent : 28.10.2019
आदे श/ O R D E R
PER S. JAYARAMAN, ACCOUNTANT MEMBER:
The assessee filed this appeal against the assessment order passed by the ACIT(OSD), Corporate Range 1, Chennai U/s.143(3) r.w.s. 144C(1) r.w.s. 92CA for the assessment year 2013-14 , in pursuance of the directions issued by the Dispute Resolution Panel (hereinafter 'DRP') in F.No.01/DRP-2-BNG/2017-18 dated 30.01.2018.
:-2-: IT(TP)A No. 22/Chny/2018
2. M/s. Bengal Tiger Line India Pvt. Ltd., (BTL India), the assessee, incorporated in India on 28.12.1994 is a subsidiary of Bengal Tiger Line Ltd., Cyprus. BTL Cyprus holds 75% of the shares and the balance 25% shares are held by the Schoeller Holdings Ltd., Cyprus. Bengal Tiger Line Group (BTL Group) is a Common Feeder Carrier offering container shipping services working traditionally with agency houses. BTL Group has general agents in South East Asia. The Far East and Arabian Gulf and group owned agency set ups in India and Sri Lanka. The associated enterprise, BTL Singapore acts us the head office of the group.
2.1 BTL India's, the assessee's, business is broadly Shipped agency/container shuttle feeder services and it activities are classified as:
• Activities related to operation.
• Activities related to accounting, finance and budgeting.
b. Sign on/ Sign off of crew
c. Coastal business
:-3-: IT(TP)A No. 22/Chny/2018
2.2 During the financial year 2012-13 relevant to the assessment
year 2013-14, BTL India, the assessee claimed to have rendered shipping agency services to its AE, BTL Pte Ltd, Singapore by acting as a general agent for trans-shipment from/to the Indian ports of Chennai, Kolkata, Haldia, Cochin, Tuticorin & Vizagto/from the Hub ports of Singapore, Colombo, Port Kelung, Karachi, Penang and Jebel Ali. As an agent ,BTL India arranges for the carriage of the containers of main land operators in chartered ships and provides slots in chartered ships to the Main Line Operators, freight forwarders, cargo consolidators, etc. The assessee also provided accounting, finance and budgeting services ancillary to shipping to its AE. For the agency services provided, the assessee is compensated at rate of 1.5% of FOB value of the turnover. In its TP study, the assessee adopted TNMM as most appropriate method to benchmark its international transaction. The net profit earned by the assessee was25.26% whereas the 5 comparables selected by the assessee had only earned a net profit margin of 5.81%.
Accordingly, the assessee justified its international transaction to be at arm's length. However, the TPO on detailed examination held , inter alia , that the assessee is not only performing the functions of the general shipping agent , but is also actively participating in the :-4-: IT(TP)A No. 22/Chny/2018 operations of the feeder ship similar to that of AE and concluded that the assessee and its AE are performing similar functions . In view of that, the TPO concluded that the commission of 1.5 % on freight income is not commensurate with the functions undertaken by the assessee. As a result, the TPO computed the profit of Singapore in the calendar year 2013 to be 8.9% and 9% respectively for the calendar year 2012. The TPO applied the profit margin of 9% arrived from the financials of BTL Singapore upon the revenue earned by BTL Singapore from its India operation which amounts to Rs 422 crores. A profit of Rs 37.94 crores had been attributed the TPO based on the working. Further the TPO proposed that 60% of the profit to be attributable to AE and 40% of the profit in relation to BTL India. Consequently an upward adjustment of Rs.13,60,93,470/- was proposed. Further, the AO has disallowed dock and logistics charges incurred by the assessee at Rs.16,43,389 under section 37(1) of the Act . On the assessee's objections, the DRP while specifically acknowledging the significant additional functions/assets/risks performed/assumed by AE has upheld that the profits should be spilt. However, it modified the profit split percentage in the ratio of 75:25. It has also upheld the disallowance made u/s 37. The assessee filed this appeal against :-5-: IT(TP)A No. 22/Chny/2018 the order passed by the AO giving effect to the directions of the DRP .
3. The ld AR submitted that both the lower authorities have committed grave mistake by upholding profit split method and submitted as under :
a) Hiring and Operation of Vessels/leasing of ship:
The crucial function of the shipping business is the hiring/ leasing of ships/vessels. BTL Singapore/AE is involved in the hiring of the ships and enters into an agreement with the feeder vessel owners for operation of the ships. The cost incurred in relation to the operating ships and taking the financial exposure of paying all operating costs from charter hire, bunkers to port costs are borne by the AE. Further, the ships/vessels are insured by the AE and the risks in relation to the same are borne only the AE.
b) Entering into Contracts with Main Line Operators After hiring of vessel for feeder shipping operation, the next step is to obtaining customer contracts. The Appellant would like to bring to the attention of the Hon'ble bench that there is an online portal where MLO will request for bidding or tendering The MLOs directly contact BTL Singapore/AE (lowest bidder) and enter into contract.
The AE alone enters into contract with the third party customers for both inbound and outbound freights from and to India and this fact was accepted by the TPO (TP order Page 5, Para 6).
c) Expenses incurred by AE vis-a-vis Appellant The Appellant wishes to highlight that the expenses incurred by the AE in Singapore for rendering feeder ship services are completely different from the expenses incurred by the Appellant which provides mere agency services. The detailed break up of expenses is provided below:
:-6-: IT(TP)A No. 22/Chny/2018
Particulars BTL Singapore# BTL India
Amount Percentage Amount Amount Percentage
(USD) on total cost (INR) (USD) on total
(%) cost (%)
Bunker expenses 14,508,390 13.31% - - -
Charter expenses 7,058,044 6.47% - - -
Voyages expenses 40,321,162 36.98% - - -
Employee benefit 3,159,484 2.90% 30,293,601 560,681 51%
expenses
Finance costs 163,665 0.15% 113,803 2,106 0.19%
Other Expenses 1,446,184 1.32% 28,998,520 536,712 48.81%
and Depreciation
Indirect Expenses 42,386,264 38.87% - - -
Total Expenses 109,043,193 100% 59,405,924 1,099,499 100%
*Exchange rate used for conversion is Rs. 54.03
# 2012financial data
On analysis of expenses of the AE, it is very clear that the functions at both the ends (i.e., Singapore and India) are different.
The major expenses incurred by the AE is voyage, bunker and charter expenses which amounts to more than 56% of its total cost whereas for the Appellant the major expenses is only Employee cost. The quantum of expenditure incurred by both the entities should also be taken into account.
It should also be appreciated that the AE which is entering into an agreement with the vessel owner for hiring of vessels will only have the right to enter into an agreement with the MLOs for providing feeder services.
Without prejudice to the grounds of the Appellant with respect to incorrect rejection of comparable companies, the Appellant wishes to highlight that the TPO rejected the comparable companies of the Appellant by stating that the major expenses incurred by the comparable companies are transport and voyage expenses which are different from the Appellant. However, for application of PS M, the TPO states that the functions of AE and Appellant performs similar functions without appreciating the fact that the AE also had incurred voyage, charter and bunker expenses which are not incurred by the Appellant.
:-7-: IT(TP)A No. 22/Chny/2018 Therefore, it is not clear as to what is the stand of the TPO and on what basis the applicability of PS M has been upheld by the DRP.
d) Ownership of high value assets:
i. Tangible Assets:
The TPO initially in the TP order made an incorrect statement that the Appellant is having suitable plant and machinery in place to facilitate the loading and unloading at port without appreciating that the Appellant does not own any huge plant and machinery but own only general fixed assets for business operation purposes which is evident from the fixed asset schedule of the Appellant.
ii. Intangible assets The TPO further stated that the employees of the Appellant have developed an efficient laisoning and working relationship with the Government and other authorities over a period, which is an intangible benefit by itself without appreciating the fact that the role of Appellant is to perform only agency function with respect to filing of respective documents for port clearance. However, the loading and unloading activities are taken care at the Port terminal by the ship runners (workers at the terminal) and the Appellant only supervises the same.
It is to be noted that the AE undertakes important business decisions with respect to hiring of vessels, negotiation with MLOs, development of customised software etc. which in turn requires skilled employees. Thus, the above business activities are important in the value chain which will in turn result in profits.
The TPO had stated in his TP order that the employees of the Appellant who liaison with government and other authorities had developed are human intangibles without appreciating the fact that the skilled employees are employed by Singapore.
The above is also demonstrated in the employee costs incurred by both the entities. The employee cost of AE is USD 3,159,484/- in FY 2012 whereas for the Appellant it is USD560,681/- in FY 2012-13. Taking into account :-8-: IT(TP)A No. 22/Chny/2018 the cost base of both the entities, the Appellant employee cost base amounts to INR 59,405,924 (USD 1,099,499) which results in 1% of the AE's total employee cost base (USD 109,043,193).
An important criteria for application of PSM is ownership or transfer of unique intangibles. It is also an established criteria for application of PSM that each of the party should have contributed their respective intangibles to develop the new process or products. Further there are no unique intangible as contemplated through R&D, as made clear by the CBDT Circular No.02/2013, for applying PSM. Though the circular is subsequently withdrawn by CBDT by stating that it gives a preference for application of PSM where there is unique intangible is involved or the transactions are so interrelated that they cannot be benchmarked separately for determining the arm's length price. However, going by the substance of the erstwhile circular and it is a well-known fact that circulars are issued to provide only clarification on the existing provisions of the law, it can be concluded that the PSM cannot be applied in the Appellant's case as there are no unique intangibles created out of any research and development activities.
In this case, the Appellant wishes to highlight that the BTL Singapore/AE own all the intangibles such as significant human intangibles, trademarks and software license.
The Appellant further states that the software 'Synmax' was developed and owned by AE and the relevant evidence is provided vide Appendix D. The employees of BTL India are provided with restricted access only with respect to their said departments, in case of any further assistance BTL Singapore requires to provide clearance. The software is equipped in sending automated report on vessel arrival (with arrival and departure time) which in turn were provided by the AE. The software automatically raises invoice to the customers on behalf of BTL Singapore. In case of any IT errors, the same is being handled and rectified by the IT Singapore team. This clearly depicts the fact that the Appellant does not own or develop any unique intangibles.
Thus there are no high value assets owned or maintained by India. Also the intangible assets are owned by AE, hence it is grossly incorrect to apply PSM that there are human intangibles and high value assets owned by India.
:-9-: IT(TP)A No. 22/Chny/2018
e) Functions performed by AE vis-a-vis Appellant:
As the TPO has incorrectly held that the Appellant and AE are providing similar functions at both the ends. The Appellant would like to highlight that the AE is involved in • Hiring and Operation of Vessels/leasing of ship • Taking the financial exposure of paying all operating costs from charter hire, bunkers to port costs, agency commission etc • Contracting with customers, liaises/negotiates with customers on the pricing and terms of sales, and builds and maintains customer relationships.
• Providing the schedule of feeder ships.
In contrast, the Appellant does not perform any of the above functions nor have any direct or indirect contact with the vessel owner as the vessels are independently taken on leased by the AE. The Appellant contacts only the AE's clients which are the MLOs forintimating the shipping schedules and other coordination functions. Hence the Appellant liaises/coordinates with only the MLOs and has no relationship/contact with the vessel owner.
Also, it is to be noted that the MLO agreement will not capture the entire gamut of services performed by the AE in relation to its business operations such as marketing activities to solicit various customers, chartering of ships or any strategic activities such as selection of MLOs, since AE caters to various third parties having different service needs.
Hence it is grossly incorrect to apply PSM by concluding that the transactions of the Appellant and its AE are similar and interlinked. In fact for application of PSM the international transactions are to be interlinked to such an extent that they cannot be separately benchmarked. However, in the case of the Appellant, the transactions are not interlinked and each functions performed by the AE and the Appellant are completely different and separately benchmarked. The step by step functions performed in the value chain by the AE and the appellant in the form of a flow chart is given vide Appendix.
Also, it is known fact that the expenses incurred by the entities will be directly linked to the business operations of such entities. The TPO has :-10-: IT(TP)A No. 22/Chny/2018 incorrectly attributed the profits from feeder shipping functions without appreciating the fact that the profit attribution is not commensurate to the size of the businesses.
The Appellant with INR 5,98,35,357 (USD 1,101,940.27) of cost base cannot share the profits with AEs who has incurred USD 108,953,193. i.e., the Appellant who has invested in ship/vessel, infrastructure etc and incurred related expenditure cannot be made to share profits with its agent who performs only agency functions in the nature of port clearance, communication to AE's customers.
f) Assumption of Risks i. Contract Risks The TPO has incorrectly held that contract risk (service liability risk and delivery risk) is borne by both the Appellant and AE. It is to be noted that the entity which actually enters into contract with the third party is wholly responsible to the third party for any contractual obligations (final delivery of the product to the customer).
In the instant case, only the AE contracts with the third party customer and this fact was accepted by the TPO (TP order Page 5, Para 6). Further it is also very clear from the extracts of the agreement between the AE (Connecting Carrier) and the MLO (Publishing Carrier) furnished in the TP order (TP order Page 6, Para 6.1.4 and Page 7, Para 6.4.1) that the AE bears the operational risk and risk of damage of goods for its customers.
The Appellant merely acts as an agent of its principal. Hence there is no question of the Appellant being liable to the end customer in case of failure to meet contractual obligations as no contractual relationship even exists between both parties.
Further, the one who takes the risks would have taken sufficient measures for mitigation of the same. It is also to be noted that the agency agreement states that the Appellant would be indemnified for any claim, charges, losses, damages or expenses incurred in connection with fulfilment of its duties.
:-11-: IT(TP)A No. 22/Chny/2018 11. Credit Risk
The Appellant also does not bear any credit risk on account of default in payments made by either the-customer. The same is also evident from Profit & Loss account of the Appellant where there are no expenses/provisions in relation to 'bad debts'.
Hence, there is no credit risk borne whatsoever by the Appellant at any leg of the transactions.
iii. Market risks The TPO and DRP has held that the Appellant is performing marketing functions as per the agency agreement. Agreements generally are worded in a comprehensive manner to include all the potential activities that may be performed by Agent on behalf of the principle.
The majority of the marketing activity is undertaken by the BTL Singapore for the business from MLOs who accounts to 99.6% of overall revenue earned.
A very minimal marketing function is performed by the Appellant-if there is excess capacity on the ship, the Appellant coordinates with a Non Vessel Operating Company (NVOC) based on the rate card fixed by the AE.
The total revenue from such activity out of the total outbound freight from India amounts to only 0.40% (approx.) for the assessment year under consideration.
Hence, the miniscule marketing activity performed by BTL India cannot be compared with the marketing functions performed by the AE which executes marketing strategies and formulate marketing budgets, as well as visit customers in overseas locations. The allocation of 25% by the DRP of profits to the Appellant for performing this minimal marketing activity gives a misleading picture as the activity generate less than 0.50% to the total outbound business from India which is immaterial to the Group's revenue.
:-12-: IT(TP)A No. 22/Chny/2018 g) Profit Split Method: i. Incorrect selection of PSM
The Appellant humbly submits that PSM should not be applied as MAM since it is applicable only when the international transactions involve unique intangibles or when there are multiple international transactions that there are multiple international transactions which are so interrelated that they cannot be evaluated separately. It is humbly submitted that in the Appellant's case, the international transaction does not involve unique intangible nor are the international transactions so interrelated in order to apply PSM. It is to be noted that the relationship between the AE and Appellant is that of a Principal and Agent and the contractual obligations of the Appellant are clearly defined in the agency agreement.
Without prejudice to the arguments of the Appellant for rejection of PSM as most appropriate method, the Appellant submits that from the analysis of functions performed, assets owned and risks assumed by AE and Appellant, it is very clear that Appellant performs only agency functions mainly with respect to documentation work for port clearance and collection of freight predominantly for outbound freights on behalf of AE, whereas the AE performs the feeder shipping functions from hiring of vessel to undertaking risks of delivering of freight to customers/MLOs ."
3.1 Thereafter, the ld AR submitted that the assessee's function is not having any unique or valuable contribution , there is no integration of functions performed , assets used and risks assumed . therefore pleaded to reject the application of PSM . With regard to the corporate issue , the ld AR submitted that the AO has disallowed dock and logistics charges under section 37(1) and this issue is a covered issue in the assessee's own case for AY's 2009- 10 and 2011-12 wherein the CIT(A) vide separate orders dated 01 August 2016 in ITA No.87 (New ITA No.9)/2013-14 and ITA :-13-: IT(TP)A No. 22/Chny/2018 No.51/2015-16 respectively has held that dock and logistics charges is allowable as deduction and that the issue has attained finality as the revenue has not preferred further appeal. This issue is squarely covered by the decision of Madras High Court in CIT vs. South India Corporation (Agencies) Ltd [290 ITR 217J wherein it has been held that expenses incurred at harbour, customs, airport etc. for release of goods were considered as inevitable expenditure for the purpose of running the business and allowed the same as deduction under section 37(1) of the Act.
3.2 Per contra, the DR supported the order of the lower authorities and took us through relevant portion .
4. We heard the rival submissions and gone through relevant material. Therelevant portion of the order of the DRP is extracted as under :
4.4 We have considered carefully the FAR analysis of activities of B'TL India and BTL Singapore (AE) made by the TPO in para 7.2 of his order.
Though the assessee has claimed to be a risk mitigated entity, the TPO has done a detailed comparison of the functions of assessee and AE both, compared the contract with actual conduct manifested in its actual operation and has come to conclusion that the assessee was performing economically significant functions in India for the entire group, particularly for its AE. After detailed analysis, the TPO in his order in para 9, has come to a conclusion that the method utilised by the assessee didn't capture the contributions well. It was observed by the TPO that taking advantage of NIL shipping tax in Singapore, profits have been shifted to Singapore and hence profit shown have been distorted. AE and :-14-: IT(TP)A No. 22/Chny/2018 assessee have performed identical functions which were closely intertwined and without which revenue generation could not have been possible. The TPO has rightly rejected all the comparables under TNMM and has adopted profit split method based on the net profit of combined financials of its AE. Total freight of India operation of Rs.421.6 crores was taken as a base by the TPO for the profit split. Under the above- mentioned facts and circumstances of the case, adoption of profit split method by the TPO is found to be justified and acceptable.
4.5. We have perused the TPO's order, Assessee's TP study, AE's Financials and agreements and carefully considered all the submissions made by the assessee before the TPO and DRP. Before proceeding 'further, it is appropriate to highlight following important facts and findings of the Panel:
(i) Functions performed by the assessee during the year has been much beyond the function of an Agent. Clause 1 of Agency agreement states that the assessee has to perform 'feeder agency functions' in India in accordance with existing and future instructions of the principal. Clause 2 of the said agreement states that the duties of the assessee will include the 'marketing' and handling of principal's services. Assessee in its submissions before the TPO (reproduced at para 4.3 above under the heading A & E) has stated that it coordinates with MLO agents for 'canvasing slots' already agreed with principals and 'collects freights' due to the principals from the MLO and also 'collects freight and other charges' on behalf of its Principal. Accordingly, assessee is found to have performed substantial economic functions as against its claim of being a mere agent of the AE
(ii) Responsibilities of Shipping Agents have been documented at para 6.5.1 of the TPO order, which inter- alia includes 'collecting freights and cargos';
(iii) Remuneration (1.5% commission) received by the assessee is far too less, and not commensurate to the above mentioned functions performed during the year;
:-15-: IT(TP)A No. 22/Chny/2018
(iv) Functions performed by the Assessee and AE are closely inter- related& intertwined and TPO's adoption of Profit Split Method is found acceptable;
(v) Assessee did not produce financials and agreements of the AE before the TPO. Such documents were obtained by the TPO through exchange of information from Singapore and were used in the TPO order.
(vi) As per Note 24, page 35 of the Financials of the AE for FY 2012 and Note 22, page 32 of the Financials for FY 2013, which were not produced before the TPO and were subsequently produced by the Assessee before the DRP on 24.1.2018, Shipping profit of the AE were exempt from Income Tax under Section 13F of Singapore Income Tax Act.
(vii) Out of Rs 421.60 crores of revenue generated in India, 1.5% was retained in India by the Assessee as commission and remaining 98.5% went to the AE in Singapore.
(viii) As against the initial proposal for profit split ratio of 50:50, in view of additional functions performed by the AE, TPO has adopted profit split ratio of 60:40.
(ix) Though the financials of the AE were produced before the DRP, assessee did not help and could not explain various expenses debited by the AE and the net margin of AE from its India business to rebut TPO's approach of adopting net margin @9%. In the circumstances, we are inclined to upheld the TPOs approach in taking the profit margin @ 9%.
(x) Analysis and conclusions drawn by the TPO ill his order dated 23.2.2017 are based on overall and unique sets of facts and circumstances of the case.
4.6. It needs to be appreciated herein that the TPO has provided detailed point by point explanation on rejection of assessee's methodology of determining ALP. We find no reason to deviate from TPO's findings. The assessee has not been able to bring anything concrete to negate TPO's findings except for general and broad arguments. However, we are also of the opinion that the AE has performed additional functions and deployed higher assets on account of hiring of vessels and has assumed corresponding risks. In the profit split ratio adopted by the TPO, though the additional function had been factored in, the other two components i.e. :-16-: IT(TP)A No. 22/Chny/2018 higher assets deployed and higher risks taken by the AE are not sufficiently factored in. Accordingly, we direct the AO / TPO to adopt a profit split ratio of 75% (AE) and 25% (Assessee). All the grounds of objections (1.4 to 1.7) are rejected subject to above specific direction."
5. From the above, it is clear that the assessee did not produce financials and agreements of the AE before the TPO. Such documents were obtained by the TPO through exchange of information from Singapore and were used in the TPO order. They were subsequently produced by the assessee before the DRP on 24.1.2018and the DRP found that shipping profit of the AE were exempt from Income Tax under Section 13F of Singapore Income Tax Act. The DRP also held that though the financials of the AE were produced before the DRP, the assessee did not help and could not explain various expenses debited by the AE and the net margin of AE from its India business to rebut TPO's approach of adopting net margin @9%. In the circumstances, the DRP upheldthe TPOs approach in taking the profit margin @ 9%. The DRP was alsoof the opinion that the AE has performed additional functions and deployed higher assets on account of hiring of vessels and has assumed corresponding risks. In the profit split ratio adopted by the TPO, though the additional function had been factored in, the other two components i.e. higher assets deployed :-17-: IT(TP)A No. 22/Chny/2018 and higher risks taken by the AE are not sufficiently factored in.
Accordingly, the DRP directed the AO / TPO to adopt a profit split ratio of 75% (AE) and 25% (Assessee). However, from the submission of the assessee, extracted supra, it is clear that the expenses incurred by the AE vis a vis the assessee and all other aspects have not been properly examined but an adhoc method is adopted in determining the income . Therefore, we deem it fit to remit all these issues to the AO/ TPO for a fresh examination and due decision. The assessee shall place all the material in support of its contention before the AO/ TPO and shall comply with his requirements in accordance with law. The AO/ TPO is also at liberty to conduct appropriate enquiry and after affording adequate opportunity to the assessee, the AO/ TPO shall decide the issues in accordance with law.
6. On the corporate tax issue viz the disallowance of Dock, and Logistics Expenses, since on this issue the CIT(A) vide separate orders dated 01 August 2016 in ITA No.87 (New ITA No.9)/2013-14 and ITA No.51/2015-16, respectively, has held that dock and logistics charges is allowable as deduction and those orders have attained finality as the revenue has not preferred further appeals, we are of the view on the principle of consistency the assessee is :-18-: IT(TP)A No. 22/Chny/2018 entitled to the relief sought and accordingly allow the appeal on this issue.
7. In the result, the assessee's appeal is treated as partly allowed for statistical purpose.
Order pronounced in the court on 28th October, 2019 at Chennai.
Sd/- Sd/-
(धु3वु4 आर एल रे 6डी) (एस जयरामन)
(Duvvuru R.L Reddy) (S. Jayaraman)
$या यक सद7य/Judicial Member लेखा सद7य/Accountant Member
चे$नई/Chennai,
%दनांक/Dated 28th October, 2019
RSR
आदे शक त(ल)पअ*े)षत/Copy to:
1. अपीलाथ /Appellant 2. यथ /Respondent 3. आयकरआयु-त (अपील)/CIT(A)
4. आयकरआय-
ु त/CIT 5. )वभागीय त न0ध/DR 6. गाड फाईल/GF