Income Tax Appellate Tribunal - Bangalore
Dell International Services I P Ltd, ... vs Deputy Commissioner Of Income Tax, ... on 31 March, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
'B' BENCH, BANGALORE
BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER
and
SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER
MP No.33/Bang/2017
(In IT(TP)A No.1302/Bang/2010)
(Assessment year: 2006-07)
M/s.Dell International Services India Pvt. Ltd.
12/1, 12/2A, 13/1A, 3rd floor,
Divyasree Greens, Koramangala Ring Road,
Bangalore-71 ... Petitioner
PA No.AABCD 1741 M
Vs.
Deputy Commissioner of Income-tax, LTU,
Bangalore ... Respondent
Petitioner by : Shri K.R.Vasudevan, Advocate.
Respondent by : Shri Kamaladar, Standing Counsel
Date of hearing : 17/03/2017
Date of pronouncement : 31/03/2017
O R D E R
Per INTURI RAMA RAO, AM :
This MP is filed by the assessee-company seeking modification of the order passed by the Tribunal in IT(TP)A No.1302/Bang/2010 dated 22/07/2016 to include a direction to the AO/TPO to decide the objections raised by the assessee- company vide ground Nos.2 to 8 pertaining to application of various filters and acceptance/rejection of certain companies.
MP No.33/B/2017 Page 2 of 3
2. We heard rival submissions and perused material on record. This Tribunal, while passing the impugned order vide para.9 had clearly held that:
"9. We heard rival submissions and perused the material on record. The issue in appeal is whether the price determined under MAP mechanism can be adopted even in respect of non-MAP transactions. It is the submission of the assessee-company that the same price fixed under MAP in respect of US AEs can be adopted even in respect of non-US AEs. We are of the considered opinion that this issue can be decided only by the TPO after undertaking FAR analysis of non-US transactions with a view to find out whether there is any distinction in the factors influencing the price between US and non-US transactions. Even in the decision relied on by the learned counsel for the assessee, the Hon'ble Tribunal had rendered a categorical finding that there is no such distinction. We, therefore, direct the TPO to adopt the same price. In the present case, no attempt has been made by the learned counsel for the assessee to bring out the similarities of the factors that influenced the price between US and non-US transactions. In the absence of this analysis, comparability may not be in terms of the provisions of rule 10B(1)(2) of the IT Rules, 1962. Therefore, we are of the considered opinion that the matter be restored to the file of the TPO/AO for fresh analysis on the lines between US and non-US transactions and if it is found that factors influencing the price are similar between US and non-US transaction, the price adopted for US transactions may be adopted for non-Us transactions also."
This Tribunal in para.9 of its order, restored the issue of comparability of non-USA transactions with that of USA transactions to find out similarities of the factors influencing price between USA and non-USA transactions. It is the contention of the assessee-company that in case it is found that there are no similarities or factors fixing the price between USA and non-USA transactions, the comparability has to be examined by applying MP No.33/B/2017 Page 3 of 3 various filters undertaking FAR analysis. In the absence of this direction, TPO may not undertake this exercise. We find merit in the submission of the assessee-company. Therefore, we direct the AO/TPO to adjudicate the issue of comparability of various entities with that of assessee-company by applying various filters undertaking fresh FAR analysis in accordance with law after affording due opportunity to the assessee-company.
3. In the result, the MP is allowed on the above lines.
Order pronounced in the open court on 31st March, 2017.
Sd/- Sd/-
(VIJAY PAL RAO) (INTURI RAMA RAO)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Place : Bangalore
D a t e d : 31/03/2017
srinivasulu, sps
Copy to :
1 Appellant
2 Respondent
3 CIT(A)
4 CIT
5 DR, ITAT, Bangalore.
6 Guard file
By order
Assistant Registrar
Income-tax Appellate Tribunal
Bangalore