Income Tax Appellate Tribunal - Chennai
India Japan Lighting P Ltd., Chennai vs Assessee on 10 April, 2013
IN THE INCOME TAX APPELLATE TRIBUNAL
"B" BENCH, CHENNAI
BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER
AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER
I.T.A. No. 2154/Mds/2011
(Assessment Year : 2007-08)
M/s India Japan Lighting P. Ltd.,
'Aalim Centre', 2nd floor, The Deputy Commissioner of
82, Dr. Radhakrishnan Salai, v. Income Tax (LTU),
Chennai - 600 004. Chennai.
PAN : AAACI 2663 L
(Appellant) (Respondent)
Appellant by : Shri R. Vijayaraghavan, Advocate
Respondent by : Dr. S. Moharana, CIT
Date of Hearing : 10.04.2013
Date of Pronouncement : 30.04.2013
O R D E R
PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER :
In this appeal filed by the assessee, it has taken three effective grounds. First one assails the adjustments made to the prices paid by it for purchases made from its Associate Enterprise. Second one is with regard to disallowance of royalty and third one is on a 2 I.T.A. No. 2154/Mds/11 disallowance under Section 14A of Income-tax Act, 1961 (in short 'the Act').
2. Issue relating to adjustments made to arm's length price is considered first.
3. Facts apropos are that assessee is a joint venture between Lucas-TVS Limited, Chennai and Koito Manufacturing Company Limited, Japan. It is engaged in manufacture of headlamps, rear combination lamps and other lamps for automotive applications. Assessee had entered into international transactions with its Associate Enterprises in Japan for import of components, import of capital asset, payment of royalty, design and drawing fee. For justifying the costs, assessee had used Transaction Net Margin Method (TNMM) using its operating margin to total cost as Profit Level Indicator (PLI).
4. Assessing Officer, during the course of assessment, made a reference to Transfer Pricing Officer (TPO) under Section 92CA(1) of the Act for determination of arm's length price on the transactions recorded by the assessee in Form No.3CEB filed by it along with its return. A perusal of the order dated 29.10.2009 of TPO clearly brings 3 I.T.A. No. 2154/Mds/11 out that an adjustment was recommended only in respect of cost of components imported by the assessee from Koito Manufacturing Company Limited, Japan and not on any of the other international transactions. As per the TPO, the costs of the components imported from the said Associate Enterprise, were higher than the arm's length price attributable to such components and for reaching this conclusion, she applied TNMM method and the companies which she selected as comparables were Japan Lighting, Lumax Industries Ltd., Minda Industries Ltd. and Phoenix Lamps Ltd. Though in the order dated 29.10.2009, TPO recommended a downward adjustment of ` 1.44 Crores on the cost of components imported by the assessee from its Associate Enterprises, later based on an application filed by the assessee under Section 154 of the Act, the TPO passed a revision order on 21.1.2011. The revision was considered necessary for adjusting excess freight of ` 2.19 Crores and rejection cost of ` 1.32 Crores, vis-à-vis the operative cost earlier reckoned. The final recommendation of the TPO for adjustment on the cost of components purchased by the assessee, was as under:- 4 I.T.A. No. 2154/Mds/11
Rs in Cr.
Operating Income 109.86 Operating Cost (adjusted towards freight ` 2.74 103.90 crore and rejection cost ` 1.32 Crore) Net Operating Income 5.96 % of Operating Profit on Operating Income 5.43% PLI of Comparables 6.15% The ALP Cost of the assessee 103.9 x 93.35 = 103.11 94.57 Less: Non AE cost = 90.71 ALP of AE cost of the Assessee Co. 12.40 Less: Actual value 13.19 .79 Difference to be adjusted Rs.0.80 Cr.
5. Based on the TPO recommendation, a draft assessment was proposed by the Assessing Officer. Assessee, thereafter, moved before Dispute Resolution Panel (DRP). Argument of the assessee before DRP was that the adjustments claimed by the assessee while working out the Profit Level Indicator (PLI) of the candidate companies, were not considered by the TPO. However, the DRP was not impressed. According to them, out of three adjustments claimed by the assessee, TPO had allowed two adjustments, namely, adjustment of freight cost and adjustment for rejection. The only item not allowed by the TPO was the claim of adjustment for R&D bench 5 I.T.A. No. 2154/Mds/11 cost, viz. incremental cost towards recruitment of additional people in the Research & Development Department. DRP was of the opinion that such augmentation of the R&D was a normal business strategy and there was nothing extraordinary, requiring an adjustment on the ALP. Assessee also raised a grievance that plus / minus 5% range allowed was not given to it. However, this view was not accepted by the DRP, considering the amendments made to Section 92C of the Act by Finance (No.2) Act of 2009 with effect from 1.10.2009. The draft assessment order having been framed on 30th December, 2010, as per the DRP, the TPO was justified in not giving the benefit of plus or minus 5%, since the arm's length price for the components imported by the assessee fell above such limits. Considering the DRP recommendations, assessment was finally completed, carrying out the adjustments required by the TPO on the prices paid by the assessee for the components purchased by it, from its Associate Enterprise.
6. Now before us, learned A.R., strongly assailing the order of TPO, at the outset, submitted that various figures given by the TPO while working out the arm's length price, reproduced at para 4 above, was not disputed by him, except for the part relating to computation of 6 I.T.A. No. 2154/Mds/11 the non-AE costs. According to him, reduction in cost as a whole was computed based on the average profit margin of comparables.
However, the TPO had considered the effect of such reduction as entirely attributable to the purchases from the Associate Enterprise. According to him, the purchase made from the Associate Enterprise constituted only 12.91% of the whole cost. Methodology followed by the TPO for computing arm's length price in an international transaction was incorrect. What was worked out by the TPO was arm's length price of the total cost incurred by the assessee. He had made a comparison of such arm's length price of the cost with the actual operating costs and concluded that the difference therein was wholly attributable to the purchase effected by the assessee from Associate Enterprise. Relying on the decision of Delhi Bench oc this Tribunal in the case of IL Jin Electronics (I) (P) Ltd. v. ACIT (2010) 36 SOT 227, learned A.R. submitted that an adjustment could be made only on the operating profit that could be attributed to the imported raw material purchased from the Associate Enterprise. Here, the Assessing Officer calculated the operating profit on the entire sale of the assessee. Adjustment of arm's length price could be only on the operating profit that resulted out of sales proportionate to the imported components and not otherwise. Further, according to him, 7 I.T.A. No. 2154/Mds/11 when the Assessing Officer reduced the non-AE costs from the arm's length cost of the assessee, he only considered the cost of the raw material imported from the Associate Enterprise, but, did not deduct the proportionate cost attributable to such imports. Had such proportionate cost also been considered, according to learned A.R., the arm's length price of imported components would have been much higher than the sum of ` 12.40 Crores estimated by the Assessing Officer. There would have been no case for downward adjustment of the actual prices paid. The difference, it at all there was any, would be well below 5% limits and therefore, there was no requirement of any adjustment. Reliance was also placed on the decision of co-ordinate Bench of this Tribunal in the case of SL Lumax Limited v. ACIT in I.T.A. No. 1915/Mds/2011 dated 14.5.2012.
7. Per contra, learned D.R., strongly supporting the order of TPO, submitted that what was worked out by the TPO was the arm's length price of the raw material purchased by the assessee from its AE. The arm's length price was worked out first by finding the arm's length cost of the assessee. For arriving at the cost attributable to the transactions with non-AEs, the TPO had correctly reduced from the total operating cost, the actual cost of the raw materials purchased by 8 I.T.A. No. 2154/Mds/11 the assessee from its Associate Enterprise. The resulting figure was the actual operating cost less cost of raw material imported from the Associate Enterprise. When this sum was deducted from the arm's length cost, what would result is the arm's length price of the imported components. Therefore, according to him, the analysis made was correct and excess of ` 0.79 Crores paid by the assessee had to be adjusted by making a downward reduction of such amount from the total cost. Such amount ` 0.79 Crores exceeded 5% of the actual cost of components imported from Associate Enterprise, which came to ` 13.19 Crores. Therefore, assessee could not claim any benefit under second proviso to Section 92C(2) of the Act.
8. We have perused the orders and heard the rival submissions. For better understanding the work-out given by the TPO for calculating arm's length price of raw materials imported by the assessee, we are reformatting the chart given at para 4 above, as under:-
Operating Income of the assessee-company ` 109.86 Crores Operating cost of assessee-company after ` 103.90 Crores adjustment of freight and rejection Operating profit of assessee-company ` 5.96 Crores Operating profit as a percentage of operating 5.43% income of assessee-company 9 I.T.A. No. 2154/Mds/11 Operating profit as a percentage of operating 6.65% income in the case of candidate companies or PLI (erroneously shown by TPO as 6.15%) Operating cost of assessee-company as a 94.57% percentage of its operating income [100 (-) 5.43] Operating cost as a percentage of operating 93.35% income in the case of comparable companies [100 (-) 6.65] Operating cost of assessee-company if ` 102.55 Crores percentage based on PLI of comparable is adopted 109.86 x 93.35 100 As against the above, the arm's length price of the cost has been worked out by the Assessing Officer at 103.11 by erroneously applying the percentage on the cost, whereas the percentage ought have been applied on operating income. Even if we take the figure worked out by the TPO as correct, difference between the total operating cost of the assessee ` 103.90 Crores and arm's length price of such cost, worked out by the TPO at ` 103.11 Crores, is 0.79 Crores. Instead of doing this direct work out, TPO endeavoured to go a step further and assign such difference to the purchase cost of the components from the Associate Enterprise . In our opinion, a second error happened at this stage. The error that would happen when a total cost difference is artificially assigned to a part of the purchase has been dealt with in para 13 of an order dated 14.5.2012 of a co-10 I.T.A. No. 2154/Mds/11
ordinate Bench of this Tribunal in the case of SL Lumax Limited (supra) and this is reproduced hereunder:-
"13. This leaves us to last issue whether the method of computation adopted by the A.O. while applying the TNM was correct. This has to be decided based on the ALP worked out by the TPO which has been reproduced at para six above. There is no dispute that operating income of the assessee was ` 265.83 Crores and operating cost was 251.04 Crores. The figures were rightly considered for working out the PLI of the assessee and its comparables after excluding those items which did not fall within operating expenses or operating income. Such exclusions were confirmed by the DRP and assessee is also not agitated by such exclusion before us. While computing the arithmetic mean of the PLIs of the two comparables, no doubt, the operating margin of M/s Halonix Ltd. has been taken as 12.93%. The operating margin even going by the figures given by the Assessing Officer was only 12.23% and not 12.73%. This is a sheer arithmetic mistake. When 12.23% is considered, the arithmetic mean of PLI comes to 10.17%. This error no doubt has to be rectified. For better understanding, the determination of ALP done by the TPO, we are re-formatting his work-out without substituting the corrected PLI, upto the level of arriving at the operating costs hereunder:-
Operating income of assessee-company 265.83 Crores Operating cost of assessee-company 251.04 Crores Operating profit of assessee-company 14.79 Crores Operating profit as a percentage operating income of assessee-company 5.56% Operating profit as a percentage of operating income in the case of comparables 10.52% Operating cost of the assessee-
company as a percentage of its
operating income (100 - 5.56) 94.44%
11 I.T.A. No. 2154/Mds/11
Operating cost as a percentage of
operating income in the case of
comparable companies (100 - 10.52) 89.48%
Operating cost of assessee-company if 265.83 x 89.48
percentage based on PLI of 100
comparables is adopted = 237.86 Crores
Upto this level, the figures are exactly what has been arrived at by the TPO. Of course, we have taken 10.52% as the PLI of comparable companies, whereas, the actual PLI is 10.15%. This has been done with the purpose of making a meaningful analysis for finding out what logical error if any was committed by the TPO while working out the ALP. In our opinion, a logical error happened in the next stage, i.e. determination of non-AE cost. The non-AE costs are the costs relatable to transactions with non-Associated Enterprises and this has been taken by the A.O. as ` 235.29 Crores. He arrived at this amount by deducting from the operating cost of ` 251.04 Crores, a sum of ` 15.75 crores. The latter amount of ` 15.75 Crores is the cost of purchases effected by the assessee from Associated Enterprises. What we like to emphasize is that this was the cost of purchases only. For arriving at ALP of purchase, Assessing Officer has deducted from the total cost including material cost, the purchase cost of materials from Associated Enterprises. Total cost of ` 251.04 Crores included many number of items in addition to the raw materials, and this is evident from the table at para six above. If that is so, when from such total cost, deduction of ALP material cost alone is done, it will not give the cost of non ALP purchases. This will not give any meaningful figure at all. What has to be deducted from total cost is not only the material cost pertaining to purchase from AEs but also that part of other expenses attributable to such purchase which have a bearing on total operating margins. In other words, Assessing Officer divided the total operating cost between material cost relatable to AEs and cost relatable to non- AEs, which included both material cost as well as other costs. Thus the ALP cost arrived at by TPO was not logical. He deducted from the operating cost, only the material cost relatable to purchases from AEs and not the operating cost attributable to such material cost. The resultant figure will not give ALP of the 12 I.T.A. No. 2154/Mds/11 purchases made from AEs. If along with the material cost paid to AEs, operational cost attributable to such cost was also considered, then the sum of ` 2.57 Crores considered by the TPO as ALP of AE purchases, would have gone up significantly. In our opinion, therefore, the work out of ALP of the purchases from non-AEs has been erroneously done. The difference of ` 13.18 Crores arrived at is hypothetical. If at all raw material was deducted, other costs excluding the total raw material cost also had to be pro rata divided and deducted. No doubt, this will result in a higher ALP for the purchases made from AEs. Whether the cost when so determined falls within the +5% safe margin limits can be verified, only after a correct computation of ALP is made. We are, therefore, of the opinion that the matter requires a re- visit by the Assessing Officer insofar as it relates to determination of ALP of the purchases made from AEs. The question of application of margins on absolute terms or percentage terms is not relevant since, whatever the method of work-out, it all starts from PLI based on operating margins as a percentage. We, therefore, set aside the orders of authorities below and remit the issue back to the file of the A.O. for consideration afresh. The A.O. is free to get appropriate reports from TPO, which he deems necessary for the purpose. Ground of the assessee with respect to calculation of ALP is allowed to the extent cited above."
9. As mentioned in the above order, when calculating the non-AE cost, reducing the cost of raw material imported alone from the total cost, will not lead to a logical conclusion. When cost is distributed, it has to be so done evenly. TPO attributed the difference is ALP of cost entirely to the purchase of components made by the assessee from its Associate Enterprise which, in our opinion, will not give fair results. In any case, there is much strength in the argument of the learned A.R. that adjustment that can be carried out at the best is 13 I.T.A. No. 2154/Mds/11 only on the proportionate sale that are relatable to the components imported by the assessee from its Associate Enterprise and not on the whole of the operational income. In the circumstances, we are of the opinion that the issue of determining the arm's length price with respect to the imported components from Associate Enterprise requires a fresh look by the Assessing Officer. We, therefore, set aside the orders of the authorities below and remit the issue of determining the ALP back to the file of the A.O. The A.O. can call for reports from TPO for this purpose and assessee has to be given an opportunity to explain its case.
10. Ground of the assessee with regard to adjustment to arm's length price is allowed for statistical purposes.
11. Next grievance raised by the assessee is with regard to disallowance of royalty. Learned A.R. submitted that similar issue had come up before this Tribunal in appeals for preceding assessment years 2004-05 to 2006-07 in I.T.A. Nos.676 to 678/Mds/2010. As per learned A.R., on similar fact situation, it was held by this Tribunal that expenses debited towards royalty payments were to be treated as revenue payment in toto. Learned 14 I.T.A. No. 2154/Mds/11 D.R. fairly agreed that the issue was covered in favour of assessee by the above mentioned co-ordinate Bench of this Tribunal.
12. We have perused the orders and heard the rival submissions. The question raised is regarding payment of royalty to Koito Manufacturing Ltd., Japan. Whether such royalty paid could be allowed in full as revenue expenditure or whether it had to be considered as a capital outgo, was an issue before this Tribunal in assessee's appeals for assessment years 2004-05 to 2006-07. It was held by this Tribunal at paras 3 to 6 of its order dated 10th June, 2011, as under:-
"3. We have considered the rival submissions and have perused the entire relevant provisions of law and precedents applicable thereto and relied before us. It was argued on behalf of the assessee that in assessment year 2003-04, the Department has itself accepted this expenditure as revenue expenditure and has allowed the same as deduction u/s 35(2AB). This fact could not be successfully controverted from the side of the Revenue. We have found from the perusal of the agreement that KMC granted the assessee an exclusive right to manufacture and sell the products in India using the licenced technology provided. An exclusive right has been conferred on the assessee for manufacturing and selling the products in India. The payment of royalty towards technical information provided by a foreign company in respect of manufacturing methods of the products and the licence granted to the assessee-company to manufacture and sell the products was treated by the Assessing Officer as acquiring of an advantage of enduring nature and thus, held it to be a capital expenditure. On the other hand, the argument advanced by the ld.AR is that those 15 I.T.A. No. 2154/Mds/11 expenses for acquisition of technical know-how year after year have been held by the Hon'ble Madras High Court as 'revenue expenditure'. In this regard, reliance was also placed on the decision of Hon'ble Supreme Court rendered in the case of Alembic Chemical Works Co. Ltd vs CIT, 177 ITR 377. The ld.DR has relied on various decisions and has filed their zerox copies before us.
4. A piquant situation has arisen because it is a case where royalty was paid initially and also running expenses towards royalty are being paid year after year. As per this agreement for transfer of know-how as technical aid, initial royalty of 9 lakhs US Dollar has to be paid, and thereafter running royalty at the rate of 3.5% of the net sales is required to be paid by the assessee. We have to examine the stipulations made in the agreement qua the rights reserved by both the parties to determine whether the assessee has acquired a right to use the 'technology and licence' during the assessment years or whether the payments towards know-how/licence falls within the ambit of section 32 or not. The assessee-company has entered into a technical licence agreement with KMC, which had a 50% shareholding in the assessee-company, to manufacture and sell the contract products in India using licenced technology. The assessee-company paid a lump sum amount of 9 lakhs US Dollars to KMC to get this technology. This amount was paid in three instalments of 3 lakhs US Dollars from financial year 1996-97 to 1998-99. Apart from this, the assessee-company has been paying royalty @ 3.5% for products manufactured by using licenced technology supplied by KMC This royalty is paid @ 3.5% of net sales less imported components. As per this agreement, if there is no sales, no royalty is payable by the assessee.
5. We have gone through various Articles of this agreement which are incorporated in the appellate order for assessment year 2005-06 towards which our attention was also invited. The Assessing Officer has relied on the decision of Hon'ble Madras High Court rendered in the case of CIT vs Southern Switchgear, 148 ITR 272, affirmed by the Hon'ble Supreme Court in 232 ITR 359, to hold that the entire royalty paid has to be treated as 16 I.T.A. No. 2154/Mds/11 capital. But we have noticed that the facts of this case are slightly different and the Hon'ble Madras High Court has held in numerous other decisions that mere grant of exclusive right to manufacture may not result in acquiring any capital asset. In this regard, decision of Hon'ble Madras High Court in the case of CIT vs Lucas TVS Ltd, 110 ITR 338 which has been confirmed by the Apex Court by dismissing the SLP of the Revenue, 196 ITR 78 (Statute); CIT vs Sundaram Clayton, 136 ITR 350 (Mds); CIT vs Brakes India Ltd, 136 ITR 322(Mad); CIT vs Lakshmi Cardt Clothing, 149 ITR 712 and CIT vs IAEC Pumps, 110 ITR 353 which has been affirmed by the Hon'ble Supreme Court in the 232 ITR 316, are relevant. The Hon'ble Jurisdictional High Court has been consistently holding that grant of right to use technical know-how coupled with exclusive right to manufacture will not result in any asset of enduring benefit. In the case of Southern Switchgear(SS), the facts are that all drawings/specifications and other data furnished to SS were to be in English with measurement shown in the system currently used by brush but shall be the property of SS on the condition that SS shall agree to hold such property always subject to the continued fulfillment in clause 6(c), 6(d), 23 & 25 of this agreement and the period of ten years thereafter. But technical assistance contemplated in the agreement covered the establishment of the factory and the operation thereof for the manufacture of transformers of all kinds and types. Thus, the property in that case, i.e, the drawing, was transferred to Indian company and the technical know-how transferred was also for the setting up of the factory which are all in the capital field. In those circumstances, 25% of the payment had been held to be capital because only 25% of the initial lump sum and royalty payment was considered as capital. In the given case, no such property has been transferred to Indian Company nor is the technical data provided to set up the plant. Keeping in view the differential nuance of facts between the facts of assessee's case and other decisions of Hon'ble Madras High Court referred to above, out of which two have been affirmed by the Apex Courts whose facts are more akin to the facts of the given case, it would be just and prudent to apply the ratio decidendi thereof. The capital element involved definitely, in our considered opinion, can be attributed and has been covered in 17 I.T.A. No. 2154/Mds/11 the lump sum payment made in the beginning, which has been allowed u/s 35AB. The Hon'ble Supreme Court, in the case of CIT vs Swaraj Engines Ltd, 309 ITR 443, has clearly held that section 35AB is to be applied in respect of expenditure on technical know-how which is in the capital field and the entire amount is allowable in case it is in the revenue filed. There are numerous cases available on this issue, but there is no need to discuss all of them. The treatment given by the ld. CIT(A) to 25% of the expenses towards royalty payment, as capital and thereafter allowing depreciation thereon, is not correct approach in our opinion. Recently, the Hon'ble Madras High Court in the case of CIT vs Panasonic Carbon India Company Ltd., vide its judgment dated 12.7.2010 in Tax case Appeal Nos.552,553, 554 and 556 of 2010, has taken a decision in favour of the assessee after discussing the judgment of Hon'ble Supreme Court rendered in the case of CIT vs IAEC Pumps Ltd (supra). In that case, the technical know-how for setting up the factory of the assessee-company and commencing its production was provided by MEI [a foreign company] in consideration of a lump sum payment to MEI which was capitalized in the assessee's books of account in respective years of payment. The royalty was paid by the assessee from June 1984 onwards based on the sales effected at the rate of 2.5% on domestic sales and at 5% on exports. The court was deciding whether such royalty payment would fall within the category of revenue expenditure or capital expenditure. The High Court has taken a view in favour of the assessee. The Chennai Bench, recently in the case of Nippo Batteries Co. Ltd vs ACIT, [2011] 7 ITR (Trib) 303 (Chennai) has decided similar issue by holding that such type of royalty payment cannot be bifurcated without any provision in the agreement and the entire payment has to be treated as revenue expenditure allowable as deduction. The Bench has discussed more than a dozen of decisions of various High Courts including that of the Hon'ble Madras, Delhi and Apex Court to arrive at its above conclusion.
6. The ld.DR has relied on the decision of Hon'ble Supreme Court rendered in the case of Southern Switchgear Ltd vs CIT, 232 ITR 359. About this decision, we have already mentioned that the facts are slightly different in that case. Similarly, the 18 I.T.A. No. 2154/Mds/11 facts in the case of CIT vs W.S.Insulators of India Ltd, 243 ITR 348(Mad), are akin to the case of Hon'ble Supreme Court in Southern Switchgear Ltd(supra), in which products manufactured by the assessee were to be tested by the licensor and the drawings and documents were not to be used by the licensee for the purpose other than the purpose of the agreement which was acquiring know-how and licence for manufacture of products based on drawings provided by the foreign company. In that case, it was held that payment for obtaining know-how, drawings and information is primarily a capital expenditure, but still the Assessing Officer had allowed 20% of such expenditure as revenue which was treated as attributable to technical advice regarding day-to-day operations, layout, etc. In our opinion, this decision is not directly applicable to the facts of the given case. Another decision relied on by the ld.DR is of Hon'ble Supreme Court rendered in the case of Jonas Woodhead & Sons Ltd vs CIT, 224 ITR 342 in which it has been held that when assessee sets up a new business and the foreign firm in addition to supplying technical know-how renders valuable services in setting up the factory itself and assessee is allowed to manufacture the product in question even after the expiry of the agreement it is justified in holding that 25% of the royalty, though paid on percentage of gross turnover, was capital expenditure. Ostensibly, the facts of this case are entirely distinguishable from the case in hand. Therefore, after considering the entire facts, circumstances and legal position, we hold that the expenses debited towards royalty payments in all these assessment years have to be treated as revenue payment in toto. Our above finding results in allowing the appeals of the assessee and dismissing the appeal of the Revenue."
Respectfully following the above decision, we hold that royalty has to be allowed as revenue outgo for the impugned assessment year.
13. Ground No.2 of the assessee is allowed.
19 I.T.A. No. 2154/Mds/11
14. Third grievance raised by the assessee is on a disallowance made under Section 14A of the Act. Learned A.R. submitted that he was not pressing this ground. Therefore, this ground is dismissed as not pressed.
15. In the result, appeal of the assessee is partly allowed for statistical purposes.
Order was pronounced in the Court on Tuesday, the 30th of April, 2013, at Chennai.
sd/- sd/-
(Challa Nagendra Prasad) (Abraham P. George)
Judicial Member Accountant Member
Chennai,
Dated the 30th April, 2013.
Kri.
Copy to: Appellant/Respondent/ITO / Secretary, DRP, Chennai
TPO-V, Chennai-34/D.R./Guard file