Income Tax Appellate Tribunal Kolkata Landis+Gyr Limited, South 24 Parganas vs Dcit, Circle1(A), Kolkata, Kolkata on 17 October, 2018 IN THE INCOME TAX APPELLATE TRIBUNAL "C" BENCH : KOLKATA [Before Hon'ble Shri J. Sudhakar Reddy, AM & Shri S.S. Viswanethra Ravi, JM ] I.T.A No. 524/Kol/2017 Assessment Year : 201213 M/s Landis + Gyr Ltd. vs DCIT, Circle1(1), Kolkata [PAN: AAACV 9922 B] (Appellant) (Respondent) For the Appellant : Shri Kamal Sawhney, AR For the Respondent : Shri G. Mallikarjuna, CIT, DR Date of Hearing : 25.07.2018 Date of Pronouncement : 17.10.2018 ORDER Per S.S. Viswanethra Ravi, JM This appeal by the assessee Asst Years 201213 of the Learned Dispute Resolution Panel (DRP) dated 08.12.2016 in which directions are given to the Learned AO u/s 144C(5) of the Income Tax Act, 1961 (hereinafter referred to as the 'Act'). 2. Ground No. 1 to 5 are relating to confirmation of transaction of payment of management services fees amounting to Rs. 5,03,65,604/. 3. Heard both and perused the material available on record. It is noted that the issue raised in Ground No. 1 to 5 was decided by this Tribunal in assessee's own case by its consolidated order dated 03.08.2016 for A.Y.'s 200708 and 200809. The relevant portion of which is reproduced herein below: 2 ITA No.524/Kol/2017 M/s Landis + Gyr Ltd. A.Yr.201213 "6.3.4. Payment of Management Service fees Manufacturing (Domestic) Segment The assessee submitted that it had received varied nature of management services under a Service Agreement entered into with its AE. For the purpose of compliance with the transfer pricing documentation requirements, the assessee documented in its transfer pricing study report and submitted in the course of assessment, the management services framework wherein the description of services received, payment terms, details of cost allocation mechanism, evidences of benefits received from such services etc were explained to the revenue. These are enclosed in Page 39 and Pages 294 to 295 of the Paper Book. We find that the assessee had considered payment of management service fee to be a different class of transaction, distinct from other international transactions. Accordingly, based on functional analysis, AE was determined as the least complex party and accordingly determined to be the tested party for the purpose of the analysis. Further , TNMM was determined to be the MAM. We find that the assessee undertook to identify comparable companies rendering similar services and the international transaction was determined to be at Arm's Length. These are enclosed in Pages 295 303 of the Paper Book. The ld TPO while passing the order u/s 92CA(3) of the Act ignored the separate transaction level analysis undertaken by the assessee for justifying the Arm's Length nature of the international transaction and instead went ahead and clubbed the transaction under the TNMM analysis undertaken by ld TPO with respect to manufacturing segment. Moreover, when the ld DRP remanded back the case to the file of the ld TPO for analysis of the separate transaction level analysis and providing ground wise observations for arguments raised by the assessee before the ld DRP, the ld TPO did not offer any adverse comments with respect to economic analysis carried out by the assessee for transaction pertaining to the payment of management service fees. These are enclosed in pages 307311 and Pages 294303 of the Paper Book. The ld AR submitted that in the course of TP assessment for subsequent years i.e AYs 200910, 201011 & 201112 , the said transaction has been considered to be at Arm's Length by the ld TPO (for AY 200910) and also confirmed by the ld DRP (for AY 201011 and AY 201112) wherein, same economic analysis has been adopted by the assessee to determine the Arm's Length Price of the transaction. We hold that the study made by the assessee with regard to payment of management service fees which has been accepted by the revenue in the subsequent years, should be applied for the Asst Year 200809 also to put an end to this controversy. H