ITR VOL 351 PART 1 AND

 

INCOME TAX REPORTS (ITR)

Volume 351 Part 1 (Issue dated 25-2-2013)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

HIGH COURTS

Appeal to Appellate Tribunal --Power to consider additional evidence--Management expenses--Tribunal can remit matter to Assessing Officer to consider additional evidence--Income-tax (Appellate Tribunal) Rules, 1963, r. 29-- CIT v . Text Hundred India Pvt. Ltd. (Delhi) . . . 57

Assessing Officer --Powers--International transaction--Arms length price--Duty to determine whether transaction is international transaction--Reference to Transfer Pricing Officer--Reference does not include entire gamut of transactions between assessee and its associated enterprise--Income-tax Act, 1961, s. 92CA-- CIT v. Amadeus India Pvt. Ltd. (Delhi) . . . 92

Assessment --Duty of assessee to disclose primary facts--†Primary†--Meaning of--Income-tax Act, 1961, ss. 147, 148-- Remfry and Sagar v . CIT (Delhi) . . . 75

Capital gains --Exemption--Transfer of capital asset and investment of net consideration in purchase or construction of residential house--New residential house need not be purchased by assessee in his own name or exclusively in his name--Assessee purchasing residential house in name of his wife--Assessee entitled to exemption under section 54F--Income-tax Act, 1961, s. 54F-- CIT v . Kamal Wahal (Delhi) . . . 4

Capital or revenue receipt --Tests--Assessee receiving amount in terms of release agreement--Compensation for loss of source of income--Capital receipt--Not taxable--Income-tax Act, 1961-- Khanna and Annadhanam v . CIT (Delhi) . . . 110

International transaction --Arms length price--Determination--Reference to Transfer Pricing Officer--When can be made--Powers of Assessing Officer and Transfer Pricing Officer--Evidence of international transaction between associated concerns--Reference to Transfer Pricing Officer valid--Assessing Officer need not consider objections of assessee--Notice by Transfer Pricing Officer to assessee--Not valid--Income-tax Act, 1961, ss. 92A, 92B, 92C, 92CA, 92F, 144C-- Veer Gems v. Asst. CIT
(Guj) . . . 35

----Arms length price--Transfer Pricing Officer--Jurisdiction--Provision empowering Transfer Pricing Officer to determine arms length price of any international transaction other than that referred to him--Prospective in operation--Income-tax Act, 1961, s. 92CA-- CIT v . Amadeus India Pvt. Ltd . (Delhi) . . . 92

----Determination of arms length price--Royalty--No reduction to be made because of failure of customers to pay for product--Income-tax Act, 1961, s. 92C-- CIT v . CA Computer Associates India P. Ltd . (Bom) . . . 69

----Transfer Pricing Officer--Powers--Restricted to determining arm’s length price--No power to determine arms length of transaction not referred to him--Income-tax Act, 1961, s. 92CA-- CIT v . Amadeus India Pvt. Ltd. (Delhi) . . . 92

Penalty --Furnishing inaccurate particulars--Short-term capital gains--Assessing Officer treating amount as income from business--Amount reported in return--Treating income under some other head not inaccurate particulars--Tribunal rightly deleting penalty--Income-tax Act, 1961, s. 271(1)(c)-- CIT v . Amit Jain (Delhi) . . . 74

Reassessment --Notice--Condition precedent--Licence fee for use of goodwill--Claim based on terms and conditions of licence agreement--Failure to file licence agreement in original assessment--Failure on part of assessee to furnish primary facts fully and truly at time of original assessment--Notice valid--Income-tax Act, 1961, ss. 147, 148-- Remfry and Sagar v. CIT (Delhi) . . . 75

----Notice--Notice need not contain list of documents required to be furnished, but not actually furnished, by the assessee--Income-tax Act, 1961, ss. 147, 148-- Remfry and Sagar v . CIT (Delhi) . . . 75

----Notice--Share application money--Information from Investigation Wing that assessee one of beneficiaries of accommodation entries--No evidence to show that Assessing Officer did not receive information and had not applied his mind to information--Share applicants confirming factum of application for shares and of funds for such shares in response to notice under section 133(6) at time of original assessment--Reassessment on ground information neither available with Department nor did assessee disclose information at time of assessment proceedings--Notice not valid--Income-tax Act, 1961, ss. 147, 148-- Pardesi Developers and Infrastructure Pvt. Ltd . v . CIT
(Delhi) . . . 8

----Notice after four years--Incorrect allowance of deduction in respect of royalty received from foreign enterprise--Incorrect allowance of deduction in respect of export profit--Incorrect allowance of deduction in respect of profits and gains from newly established undertakings--Assessing Officer raising specific queries and considering material before him--Club expenses specifically mentioned in tax audit report--Assessing Officer duty bound to go through before completing assessment--Notice not valid--Income-tax Act, 1961, ss. 147, 148-- Ranbaxy Laboratories Ltd. v. Deputy CIT
(Delhi) . . . 23

Revision --Commissioner--Powers--Conditions precedent--Condonation of delay--Appeal to Commissioner (Appeals)--Order rejecting appeal--Further revision before Commissioner not maintainable--Income-tax Act, 1961, s. 264(4)-- K. H. Traders v. CIT (Ker) . . . 1

Unexplained investment --Valuation of property--Reference to District Valuation Officer--No material found in search to justify reference--Tribunal finding valuation based on incomparable sales--Taxation of amount as unexplained investment not permissible in law--Income-tax Act, 1961, s. 69-- CIT v. Abhinav Kumar Mittal
(Delhi) . . . 20

Writ --Best judgment assessment--Rectification of mistake--Disallowance of interest paid on capital account and remuneration to partners--Opportunity of hearing--Contentions not raised before appellate authority cannot be raised for first time before High Court--Income-tax Act, 1961, ss. 144, 154--Constitution of India, art. 226-- P. P. Abdul Khader and Co . v. CIT (Ker) . . . 17

 

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Constitution of India :

Art. 226 --Writ--Best judgment assessment--Rectification of mistake--Disallowance of interest paid on capital account and remuneration to partners--Opportunity of hearing--Contentions not raised before appellate authority cannot be raised for first time before High Court-- P. P. Abdul Khader and Co . v. CIT (Ker) . . . 17

Income-tax Act, 1961 :

S. 54F --Capital gains--Exemption--Transfer of capital asset and investment of net consideration in purchase or construction of residential house--New residential house need not be purchased by assessee in his own name or exclusively in his name--Assessee purchasing residential house in name of his wife--Assessee entitled to exemption under section 54F-- CIT v . Kamal Wahal (Delhi) . . . 4

S. 69 --Unexplained investment--Valuation of property--Reference to District Valuation Officer--No material found in search to justify reference--Tribunal finding valuation based on incomparable sales--Taxation of amount as unexplained investment not permissible in law-- CIT v. Abhinav Kumar Mittal (Delhi) . . . 20

S. 92A --International transaction--Arm’s length price--Determination--Reference to Transfer Pricing Officer--When can be made--Powers of Assessing Officer and Transfer Pricing Officer--Evidence of international transaction between associated concerns--Reference to Transfer Pricing Officer valid--Assessing Officer need not consider objections of assessee--Notice by Transfer Pricing Officer to assessee--Not valid-- Veer Gems v. Asst. CIT (Guj) . . . 35

S. 92B --International transaction--Arm’s length price--Determination--Reference to Transfer Pricing Officer--When can be made--Powers of Assessing Officer and Transfer Pricing Officer--Evidence of international transaction between associated concerns--Reference to Transfer Pricing Officer valid--Assessing Officer need not consider objections of assessee--Notice by Transfer Pricing Officer to assessee--Not valid-- Veer Gems v. Asst. CIT (Guj) . . . 35

S. 92C --International transaction--Arm’s length price--Determination--Reference to Transfer Pricing Officer--When can be made--Powers of Assessing Officer and Transfer Pricing Officer--Evidence of international transaction between associated concerns--Reference to Transfer Pricing Officer valid--Assessing Officer need not consider objections of assessee--Notice by Transfer Pricing Officer to assessee--Not valid-- Veer Gems v. Asst. CIT (Guj) . . . 35

----International transaction--Determination of arm’s length price--Royalty--No reduction to be made because of failure of customers to pay for product-- CIT v . CA Computer Associates India P. Ltd . (Bom) . . . 69

S. 92CA --Assessing Officer--Powers--International transaction--Arm’s length price--Duty to determine whether transaction is international transaction--Reference to Transfer Pricing Officer--Reference does not include entire gamut of transactions between assessee and its associated enterprise-- CIT v. Amadeus India Pvt. Ltd.
(Delhi) . . . 92

----International transaction--Arm’s length price--Determination--Reference to Transfer Pricing Officer--When can be made--Powers of Assessing Officer and Transfer Pricing Officer--Evidence of international transaction between associated concerns--Reference to Transfer Pricing Officer valid--Assessing Officer need not consider objections of assessee--Notice by Transfer Pricing Officer to assessee--Not valid-- Veer Gems v. Asst. CIT (Guj) . . . 35

----International transaction--Arms length price--Transfer Pricing Officer--Jurisdiction--Provision empowering Transfer Pricing Officer to determine arms length price of any international transaction other than that referred to him--Prospective in operation-- CIT v . Amadeus India Pvt. Ltd . (Delhi) . . . 92

----International transaction--Transfer Pricing Officer--Powers--Restricted to determining arms length price--No power to determine arms length of transaction not referred to him-- CIT v . Amadeus India Pvt. Ltd. (Delhi) . . . 92

S. 92F --International transaction--Arms length price--Determination--Reference to Transfer Pricing Officer--When can be made--Powers of Assessing Officer and Transfer Pricing Officer--Evidence of international transaction between associated concerns--Reference to Transfer Pricing Officer valid--Assessing Officer need not consider objections of assessee--Notice by Transfer Pricing Officer to assessee--Not valid-- Veer Gems v. Asst. CIT (Guj) . . . 35

S. 144 --Writ--Best judgment assessment--Rectification of mistake--Disallowance of interest paid on capital account and remuneration to partners--Opportunity of hearing--Contentions not raised before appellate authority cannot be raised for first time before High Court-- P. P. Abdul Khader and Co . v. CIT (Ker) . . . 17

S. 144C --International transaction--Arms length price--Determination--Reference to Transfer Pricing Officer--When can be made--Powers of Assessing Officer and Transfer Pricing Officer--Evidence of international transaction between associated concerns--Reference to Transfer Pricing Officer valid--Assessing Officer need not consider objections of assessee--Notice by Transfer Pricing Officer to assessee--Not valid-- Veer Gems v. Asst. CIT (Guj) . . . 35

S. 147 --Assessment--Duty of assessee to disclose primary facts--†Primary --Meaning of-- Remfry and Sagar v . CIT (Delhi) . . . 75

----Reassessment--Notice--Condition precedent--Licence fee for use of goodwill--Claim based on terms and conditions of licence agreement--Failure to file licence agreement in original assessment--Failure on part of assessee to furnish primary facts fully and truly at time of original assessment--Notice valid-- Remfry and Sagar v. CIT
(Delhi) . . . 75

----Reassessment--Notice--Notice need not contain list of documents required to be furnished, but not actually furnished, by the assessee-- Remfry and Sagar v . CIT
(Delhi) . . . 75

----Reassessment--Notice--Share application money--Information from Investigation Wing that assessee one of beneficiaries of accommodation entries--No evidence to show that Assessing Officer did not receive information and had not applied his mind to information--Share applicants confirming factum of application for shares and of funds for such shares in response to notice under section 133(6) at time of original assessment--Reassessment on ground information neither available with Department nor did assessee disclose information at time of assessment proceedings--Notice not valid-- Pardesi Developers and Infrastructure Pvt. Ltd . v . CIT (Delhi) . . . 8

----Reassessment--Notice after four years--Incorrect allowance of deduction in respect of royalty received from foreign enterprise--Incorrect allowance of deduction in respect of export profit--Incorrect allowance of deduction in respect of profits and gains from newly established undertakings--Assessing Officer raising specific queries and considering material before him--Club expenses specifically mentioned in tax audit report--Assessing Officer duty bound to go through before completing assessment--Notice not valid-- Ranbaxy Laboratories Ltd. v. Deputy CIT (Delhi) . . . 23

S. 148 --Assessment--Duty of assessee to disclose primary facts--†Primary --Meaning of-- Remfry and Sagar v . CIT (Delhi) . . . 75

----Reassessment--Notice--Condition precedent--Licence fee for use of goodwill--Claim based on terms and conditions of licence agreement--Failure to file licence agreement in original assessment--Failure on part of assessee to furnish primary facts fully and truly at time of original assessment--Notice valid-- Remfry and Sagar v. CIT (Delhi) . . . 75

----Reassessment--Notice--Notice need not contain list of documents required to be furnished, but not actually furnished, by the assessee-- Remfry and Sagar v . CIT (Delhi) . . . 75

----Reassessment--Notice--Share application money--Information from Investigation Wing that assessee one of beneficiaries of accommodation entries--No evidence to show that Assessing Officer did not receive information and had not applied his mind to information--Share applicants confirming factum of application for shares and of funds for such shares in response to notice under section 133(6) at time of original assessment--Reassessment on ground information neither available with Department nor did assessee disclose information at time of assessment proceedings--Notice not valid-- Pardesi Developers and Infrastructure Pvt. Ltd . v . CIT (Delhi) . . . 8

----Reassessment--Notice after four years--Incorrect allowance of deduction in respect of royalty received from foreign enterprise--Incorrect allowance of deduction in respect of export profit--Incorrect allowance of deduction in respect of profits and gains from newly established undertakings--Assessing Officer raising specific queries and considering material before him--Club expenses specifically mentioned in tax audit report--Assessing Officer duty bound to go through before completing assessment--Notice not valid-- Ranbaxy Laboratories Ltd. v. Deputy CIT (Delhi) . . . 23

S. 154 --Writ--Best judgment assessment--Rectification of mistake--Disallowance of interest paid on capital account and remuneration to partners--Opportunity of hearing--Contentions not raised before appellate authority cannot be raised for first time before High Court-- P. P. Abdul Khader and Co . v. CIT (Ker) . . . 17

S. 264(4) --Revision--Commissioner--Powers--Conditions precedent--Condonation of delay--Appeal to Commissioner (Appeals)--Order rejecting appeal--Further revision before Commissioner not maintainable-- K. H. Traders v. CIT (Ker) . . . 1

S. 271(1)(c) --Penalty--Furnishing inaccurate particulars--Short-term capital gains--Assessing Officer treating amount as income from business--Amount reported in return--Treating income under some other head not inaccurate particulars--Tribunal rightly deleting penalty-- CIT v . Amit Jain (Delhi) . . . 74

Income-tax (Appellate Tribunal) Rules, 1963 :

R. 29 --Appeal to Appellate Tribunal--Power to consider additional evidence--Management expenses--Tribunal can remit matter to Assessing Officer to consider additional evidence-- CIT v . Text Hundred India Pvt. Ltd. (Delhi) . . . 57

ITR'S TRIBUNAL TAX REPORTS (ITR (TRIB))

Volume 22 : Part 1 (Issue dated : 25-2-2013)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

Appeal to Appellate Tribunal --Power to admit additional evidence--State at which party can seek admission of additional evidence--Tribunal can suo motu require additional evidence even after conclusion of hearing--Income-tax (Appellate Tribunal) Rules, 1963, r. 29-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----Powers of Tribunal--No power to declare retrospective effect of amendment unconstitutional--Income-tax Act, 1961, s. 254-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

Charitable purpose --Registration of trust--Cancellation--Amendment of section 2(15) barring exemption where receipts exceed Rs. 10 lakhs--Not sufficient reason for cancellation of registration under section 12A(a)--Income-tax Act, 1961, ss. 2(15), 12A(a)-- Madras Motor Sports Club v. Director of Income-tax (Exemptions) (Chennai). . .175

International transactions --“Transaction --Definition--Arrangement, understanding or action in concert, whether formal or in writing--Transaction can be inferred from attending circumstances--Income-tax Act, 1961, s. 92F(v)--Income-tax Rules, 1962, rr. 10A, 10B-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----Arms length price--Burden of proof--Change of law--Is on assessee to establish that transaction recorded at arms length price--Primary duty of assessee to declare arms length price--If assessee does not, Assessing Officer free to determine arms length price on basis of material--Income-tax Act, 1961, ss. 92, 92B-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----Arms length price--Determination of cost of brand or logo promotion through advertisement, marketing and promotion expenses incurred by Indian associated enterprise for its foreign entity--Factors to be considered--Income-tax Act, 1961, ss. 92, 92B, 92C, 92CA, 92F(v)--Income-tax Rules, 1962, rr. 10A, 10B-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----Arms length price--Determination--By any of five prescribed methods--Combination of one or more of five methods not permitted--Express reference to any method not necessary if in substance computation was by any of prescribed methods--Income-tax Act, 1961, s. 92C-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----Arms length price--Determination--Provisions for allowance of business expenditure not applicable--Income-tax Act, 1961, ss. 37, 40A(2), 92C-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----Arms length price--Transactional net margin method--Operating profit from each international transaction in relation to total cost or sales or capital employed--No provision to set off negative adjustment with positive adjustment on account of different international transactions--Profit mark-up should be of comparable uncontrolled transaction--Bright line test employed to determine cost or value of international transaction--Proper--Restriction of comparable cases to two without discussing how other cases cited by assessee not comparable--Not proper--Arbitrary determination of mark-up at 13 per cent.--Not proper--Orders not void ab initio but defective--Orders set aside and matters remanded for decision afresh--Income-tax Act, 1961, ss. 92, 92B, 92C, 92CA, 92F(v)--Income-tax Rules, 1962, rr. 10A, 10B-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----Provision of services by one associated enterprise to another--Not restricted to services provided by assessee in regular course of business--Income-tax Act, 1961, ss. 92, 92B--Income-tax Rules, 1962, rr. 10A, 10B-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----Transfer pricing--Failure by assessee to furnish report in respect of transaction--Transaction coming to notice of Transfer Pricing Officer during course of proceedings--Amendment empowering Transfer Pricing Officer to consider it--Operates even for period prior to June 1, 2011--Income-tax Act, 1961, ss. 92CA(2B)-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

Interpretation of taxing statutes --Primary rule is strict or literal interpretation-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

Precedent --Effect of decision of Supreme Court in Maruti Suzuki India Ltd. -- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----Judgments of foreign courts only of persuasive value-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

 

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Income-tax Act 1961 :

S. 2(15) --Charitable purpose--Registration of trust--Cancellation--Amendment of section 2(15) barring exemption where receipts exceed Rs. 10 lakhs--Not sufficient reason for cancellation of registration under section 12A(a)-- Madras Motor Sports Club v. Director of Income-tax (Exemptions) (Chennai). . .175

S. 12A(a) --Charitable purpose--Registration of trust--Cancellation--Amendment of section 2(15) barring exemption where receipts exceed Rs. 10 lakhs--Not sufficient reason for cancellation of registration under section 12A(a)-- Madras Motor Sports Club v. Director of Income-tax (Exemptions) (Chennai). . .175

S. 37 --International transactions--Arms length price--Determination--Provisions for allowance of business expenditure not applicable-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

S. 40A(2) --International transactions--Arms length price--Determination--Provisions for allowance of business expenditure not applicable-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

S. 92 --International transactions--Arms length price--Burden of proof--Change of law--Is on assessee to establish that transaction recorded at arms length price--Primary duty of assessee to declare arms length price--If assessee does not, Assessing Officer free to determine arms length price on basis of material-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Determination of cost of brand or logo promotion through advertisement, marketing and promotion expenses incurred by Indian associated enterprise for its foreign entity--Factors to be considered-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Transactional net margin method--Operating profit from each international transaction in relation to total cost or sales or capital employed--No provision to set off negative adjustment with positive adjustment on account of different international transactions--Profit mark-up should be of comparable uncontrolled transaction--Bright line test employed to determine cost or value of international transaction--Proper--Restriction of comparable cases to two without discussing how other cases cited by assessee not comparable--Not proper--Arbitrary determination of mark-up at 13 per cent.--Not proper--Orders not void ab initio but defective--Orders set aside and matters remanded for decision afresh-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Provision of services by one associated enterprise to another--Not restricted to services provided by assessee in regular course of business-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

S. 92B --International transactions--Arms length price--Burden of proof--Change of law--Is on assessee to establish that transaction recorded at arms length price--Primary duty of assessee to declare arms length price--If assessee does not, Assessing Officer free to determine arms length price on basis of material-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Determination of cost of brand or logo promotion through advertisement, marketing and promotion expenses incurred by Indian associated enterprise for its foreign entity--Factors to be considered-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Transactional net margin method--Operating profit from each international transaction in relation to total cost or sales or capital employed--No provision to set off negative adjustment with positive adjustment on account of different international transactions--Profit mark-up should be of comparable uncontrolled transaction--Bright line test employed to determine cost or value of international transaction--Proper--Restriction of comparable cases to two without discussing how other cases cited by assessee not comparable--Not proper--Arbitrary determination of mark-up at 13 per cent.--Not proper--Orders not void ab initio but defective--Orders set aside and matters remanded for decision afresh-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Provision of services by one associated enterprise to another--Not restricted to services provided by assessee in regular course of business-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

S. 92C --International transactions--Arms length price--Determination--By any of five prescribed methods--Combination of one or more of five methods not permitted--Express reference to any method not necessary if in substance computation was by any of prescribed methods-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Determination--Provisions for allowance of business expenditure not applicable-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Determination of cost of brand or logo promotion through advertisement, marketing and promotion expenses incurred by Indian associated enterprise for its foreign entity--Factors to be considered-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Transactional net margin method--Operating profit from each international transaction in relation to total cost or sales or capital employed--No provision to set off negative adjustment with positive adjustment on account of different international transactions--Profit mark-up should be of comparable uncontrolled transaction--Bright line test employed to determine cost or value of international transaction--Proper--Restriction of comparable cases to two without discussing how other cases cited by assessee not comparable--Not proper--Arbitrary determination of mark-up at 13 per cent.--Not proper--Orders not void ab initio but defective--Orders set aside and matters remanded for decision afresh-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

S. 92CA --International transactions--Arms length price--Determination of cost of brand or logo promotion through advertisement, marketing and promotion expenses incurred by Indian associated enterprise for its foreign entity--Factors to be considered-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Transactional net margin method--Operating profit from each international transaction in relation to total cost or sales or capital employed--No provision to set off negative adjustment with positive adjustment on account of different international transactions--Profit mark-up should be of comparable uncontrolled transaction--Bright line test employed to determine cost or value of international transaction--Proper--Restriction of comparable cases to two without discussing how other cases cited by assessee not comparable--Not proper--Arbitrary determination of mark-up at 13 per cent.--Not proper--Orders not void ab initio but defective--Orders set aside and matters remanded for decision afresh-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

S. 92CA(2B) --International transactions--Transfer pricing--Failure by assessee to furnish report in respect of transaction--Transaction coming to notice of Transfer Pricing Officer during course of proceedings--Amendment empowering Transfer Pricing Officer to consider it--Operates even for period prior to June 1, 2011-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

S. 92F(v) --International transactions--Transaction --Definition--Arrangement, understanding or action in concert, whether formal or in writing--Transaction can be inferred from attending circumstances-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Determination of cost of brand or logo promotion through advertisement, marketing and promotion expenses incurred by Indian associated enterprise for its foreign entity--Factors to be considered-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Transactional net margin method--Operating profit from each international transaction in relation to total cost or sales or capital employed--No provision to set off negative adjustment with positive adjustment on account of different international transactions--Profit mark-up should be of comparable uncontrolled transaction--Bright line test employed to determine cost or value of international transaction--Proper--Restriction of comparable cases to two without discussing how other cases cited by assessee not comparable--Not proper--Arbitrary determination of mark-up at 13 per cent.--Not proper--Orders not void ab initio but defective--Orders set aside and matters remanded for decision afresh-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

S. 254 --Appeal to Appellate Tribunal--Powers of Tribunal--No power to declare retrospective effect of amendment unconstitutional-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

Income-tax Rules, 1962 :

R. 10A --International transactions--Arms length price--Determination of cost of brand or logo promotion through advertisement, marketing and promotion expenses incurred by Indian associated enterprise for its foreign entity--Factors to be considered-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Transactional net margin method--Operating profit from each international transaction in relation to total cost or sales or capital employed--No provision to set off negative adjustment with positive adjustment on account of different international transactions--Profit mark-up should be of comparable uncontrolled transaction--Bright line test employed to determine cost or value of international transaction--Proper--Restriction of comparable cases to two without discussing how other cases cited by assessee not comparable--Not proper--Arbitrary determination of mark-up at 13 per cent.--Not proper--Orders not void ab initio but defective--Orders set aside and matters remanded for decision afresh-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Transaction --Definition--Arrangement, understanding or action in concert, whether formal or in writing--Transaction can be inferred from attending circumstances-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Provision of services by one associated enterprise to another--Not restricted to services provided by assessee in regular course of business-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

R. 10B --International transactions--Arms length price--Determination of cost of brand or logo promotion through advertisement, marketing and promotion expenses incurred by Indian associated enterprise for its foreign entity--Factors to be considered-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Arms length price--Transactional net margin method--Operating profit from each international transaction in relation to total cost or sales or capital employed--No provision to set off negative adjustment with positive adjustment on account of different international transactions--Profit mark-up should be of comparable uncontrolled transaction--Bright line test employed to determine cost or value of international transaction--Proper--Restriction of comparable cases to two without discussing how other cases cited by assessee not comparable--Not proper--Arbitrary determination of mark-up at 13 per cent.--Not proper--Orders not void ab initio but defective--Orders set aside and matters remanded for decision afresh-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Transaction --Definition--Arrangement, understanding or action in concert, whether formal or in writing--Transaction can be inferred from attending circumstances-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

----International transactions--Provision of services by one associated enterprise to another--Not restricted to services provided by assessee in regular course of business-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1

Income-tax (Appellate Tribunal) Rules, 1963 :

R. 29 --Appeal to Appellate Tribunal--Power to admit additional evidence--State at which party can seek admission of additional evidence--Tribunal can suo motu require additional evidence even after conclusion of hearing-- L. G. Electronics India P. Ltd. v. Assistant CIT [SB] (Delhi) . . .1