Case Number: ITA 454/DEL/2021
Appellant: SABIC India Pvt. Ltd., Gurgaon
Respondent: DCIT Circle- 22(2), New Delhi
Assessment Year: 2016-17
Case Filed On: 2021-04-19
Order Type: Final Tribunal Order
Date of Order: 2021-06-08
Pronounced On: 2021-06-08
The case involved the appeal filed by SABIC India Pvt. Ltd. against the order of the Deputy Commissioner of Income Tax (DCIT), Circle- 22(2), New Delhi, dated 31st March 2021. The primary ground for the appeal was the transfer pricing adjustment of Rs. 361,32,20,620, which was challenged as being unsustainable in law.
The appellant raised several grounds in the appeal, including:
The assessee provided detailed arguments to justify the adoption of TNMM as the most appropriate method for benchmarking its international transactions related to marketing support services. The key arguments included:
The Income Tax Appellate Tribunal (ITAT) found that the TPO had discarded the TNMM method without assigning specific reasons and instead adopted the Other Method using inappropriate comparables. The ITAT noted that the TNMM method had been accepted by the revenue authorities in previous assessment years and that the TPO/DRP failed to justify the adoption of the Other Method.
The ITAT concluded that the lower authorities should have accepted TNMM as the most appropriate method for the appellant’s business profile. The tribunal directed the Assessing Officer (AO)/TPO to delete the transfer pricing adjustment of Rs. 361,32,20,620. Consequently, the appeal filed by the assessee was allowed, and the stay petition became infructuous.
Order Pronounced in the Open Court on 08/06/2021.
Accountant Member: N. K. Billaiya
Judicial Member: Sudhanshu Srivastava
Case Filed by SABIC India Pvt. Ltd., Gurgaon vs. DCIT Circle- 22(2), New Delhi – ITA 454/DEL/2021
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