DCIT Vs Meneta Automotive Components Pvt. Ltd. (ITAT Delhi)
Summary: The Revenue appealed against the order of the CIT(A)-44, New Delhi dated 30.11.2017 in the case of Meneta Automotive Components Pvt. Ltd. for Assessment Year 2008-09. The dispute concerned a transfer pricing adjustment of Rs.4,96,95,925/- made by the Assessing Officer (AO) himself without making a reference to the Transfer Pricing Officer (TPO).
The Revenue questioned whether the CIT(A) was justified in allowing the assessee’s appeal on the ground that the AO had not made a reference to the TPO and in deleting the transfer pricing adjustment by relying upon the judgment in M/s Ranbaxy Lab Ltd. Vs. CIT, 345 ITR 193 (Del.), despite the Revenue’s contention concerning the subsequent decision of the Bombay High Court in Vodafone India Services Pvt. Ltd. Vs. UOI, 361 ITR 531 (Bom.).
The Tribunal recorded that the fact that the AO himself had determined the Arm’s Length Price (ALP) was not disputed by either party. The short question before the Tribunal was whether the AO could himself determine the ALP without referring the issue to the TPO.
In deciding this issue, the Tribunal considered CBDT Instruction No. 3/2003 dated 20.05.2003, Instruction No. 15/2015 dated 16.10.2015 and the judgment of the Hon’ble Supreme Court dated 13.08.2019 in PCIT Vs M/s. S.G. Asia Holdings (India) Pvt. Ltd., Civil Appeal No. 6144 of 2019.
