PCIT Vs Redington (India) Limited (Madras High Court)
These appeals have been filed by the Revenue under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) challenging the common order dated 07.07.2014 passed by the Income Tax Appellate Tribunal ‘D’ Bench, Chennai (for brevity “the Tribunal”) in I.T.A.No.513/Mds/2014 (filed by the assessee) and I.T.A.No.619/Mds/2014 (filed by the Revenue) for the assessment year 2009-10.
2. The appeals were admitted on 26.08.2019, to consider the following substantial questions of law:-
“1.Whether the ITAT was right in applying the General provision Law ignoring the specific provisions of sub Section 47(iv) and holding that the transfer of shares by the assessee to its wholly owned subsidiary is to be considered as a Gift?
2.Whether the order of the ITAT upholding the decision of the Dispute Resolution Panel in granting 10% risk adjustment allowance is not perverse?
3.Whether the order of the ITAT in allowing the claim of Trade Mark Fee and deleting the addition on account of Corporate and Bank Guarantee are not perverse?”
3. The assessee filed its return of income for the assessment year under consideration (AY 2009-10) on 28.09.2009 admitting taxable income at Rs.125,57,70,310/-. The return was processed under Section 143(1) of the Act on 23.07.2010. Subsequently, the case was selected for scrutiny on the ground that the assessee had international transactions exceeding Rs.15 Crores and the case was referred to the Transfer Pricing Officer (TPO) for computation of Arms Length Price (ALP). After hearing the assessee, the draft assessment order was passed on 31.03.2013 proposing the following additions/disallowances:-
