EYGBS (India) LLP Vs DCIT (ITAT Bangalore)

IN THE INCOME TAX APPELLATE TRIBUNAL
“C’’BENCH: BANGALORE

BEFORE SHRI N.V. VASUDEVAN, VICE PRESIDENT AND
SHRI B.R. BASKARAN, ACCOUNTANT MEMBER

ITA No.2342/Bang/2019
AssessmentYear: 2011-12

EYGBS (India) LLP (Earlier known as EYGBS (India) Pvt.Ltd.) RMZ Infinity Tower C, 3rd Floor Old Madras Road K.R. Puram Bengaluru-560 016.PAN NO :AAHFE0349K
APPELLANT 

Vs.

Deputy Commissioner of Income-tax Circle-3(1)(2) Bengaluru
RESPONDENT

Appellant by : Shri Rajan Vora, A.R.
Respondent by : Smr. R. Premi, D.R.

Date of Hearing : 23.11.2020
Date of Pronouncement : 23.11.2020

O R D E R

PER B.R. BASKARAN, ACCOUNTANT MEMBER:

The assessee has filed this appeal challenging the order dated13.9.2019 passed by Ld. CIT(A)-2, Bengaluru and it relates to assessment year 2011-12.

2. At the time of hearing, the Ld. A.R. did not press ground No.2 and hence, the same is dismissed as not pressed. Ground No.3 relates to levy of interest u/s 234B of the Income-tax Act,1961 ['the Act' for short] and the same is consequential in nature. The remaining ground relate to denial of claim of deduction u/s 10AA ofthe Act on transfer pricing adjustment made by the assessee voluntarily.

2. The Ld. A.R. submitted that the assessee is 100% subsidiary of EYGI B.V., Netherlands. It is engaged in the business of providing back office support services, which are in the nature of ‘Information Technology Enabled Services’ (ITES). The nature of services provided by the assessee to its Associated Enterprises (AEs) includes financial analysis and reporting functions such as standard reporting/analysis, work-in-progress details, time sheet details etc., accounting centre processing activities/functions suchas accounts receivable, accounts payable functions, billing analysis and invoice preparation etc and financial assistance/administration functions such as time and expenses review, helpdesk providing assistance on employee queries etc. The assessee is remunerated at “cost plus” basis for the services provided to its AEs.

3. The Ld. A.R. submitted that the only issue contested before the Tribunal relates to eligibility to claim deduction u/s 10AA of theAct on transfer pricing adjustment made by the assesseevoluntarily. He submitted that this issue has been decided infavour of the assessee by the Bengaluru bench of Tribunal, vide its order dated 20.5.2020 passed in IT(TP)A No.218/Bang/2015,passed in the assessee’s own case.

4. We heard Ld. D.R. and perused the record. We notice that an identical issue has been examined by the Bengaluru bench of Tribunal in the assessee’s own case in assessment year 2010-11and it has been decided in favour of the assessee by following the decision rendered by the Pune Bench of Tribunal in the case of Apoorva Systems Pvt. Ltd. For the sake of convenience, we extract below the relevant portion of the order of the Tribunal passed in assessment year 2010-11:

15. “We shall now take up the appeal of the assessee. The main ground urged by the assessee relates to the rejection of claim for deduction u/s 10AA of the Act on the amount of transfer pricing adjustment voluntarily made by the assessee.

16. The additional grounds relate to the inclusion/exclusion of certain comparable companies. The Ld A.R submitted that the assessee may not press the additional grounds, if the revenue’s appeal is dismissed. Since we have dismissed the appeal of the revenue in the earlier paragraphs, the additional grounds urged by the assessee are not adjudicated, as the same would be academic in nature.

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