Marvell India Pvt. Ltd. Vs DCIT (ITAT Bangalore)
The appeal before the Income Tax Appellate Tribunal (ITAT), Bangalore, concerned only Ground Nos. 18 and 19, relating to corporate tax additions made in the final assessment order for Assessment Year 2017-18, after the Tribunal had already disposed of the transfer pricing issues in an earlier order and later recalled these two grounds through a miscellaneous application.
The assessee, a subsidiary engaged in providing software development services to its associated enterprise, had originally filed its return declaring total income of ₹13.72 crore. During scrutiny, the Assessing Officer (AO) referred the international transactions to the Transfer Pricing Officer (TPO), who proposed transfer pricing adjustments. Based on the TPO’s order, the AO issued a draft assessment order dated 16.02.2021, containing only transfer pricing adjustments. The assessee filed objections before the Dispute Resolution Panel (DRP).
Subsequently, the AO issued another communication dated 15.04.2021 proposing corporate tax additions. Despite the pending objections before the DRP, the AO passed a final assessment order on 26.04.2021, incorporating both transfer pricing and corporate tax additions. The Karnataka High Court quashed that assessment order as well as the DRP’s earlier order and directed the DRP to consider the assessee’s objections filed against the original draft assessment order. Thereafter, the DRP issued fresh directions on 28.11.2022, dealing only with the transfer pricing adjustments contained in the draft assessment order dated 16.02.2021. However, the AO’s fresh final assessment order dated 29.12.2022 again included corporate tax additions amounting to ₹10.89 crore, although no DRP directions had been issued on those issues.
