Remand is not a power to be exercised in a routine manner and should be used sparingly, says ITAT

The Income Tax Appellate Tribunal (ITAT) has emphasised that the power to 'remand' a case back to a lower authority is not a routine procedure and should be exercised with caution. This ruling came during the adjudication of appeals concerning Microsoft India (R&D) Pvt. Ltd. for the assessment years 2011-12 and 2012-13, following directions from the Hon'ble High Court of Delhi. The High Court had previously considered substantial grounds of appeal related to transfer pricing and the classification of software development services.

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘I-1’ BENCH,
NEW DELHI [THROUGH VIDEO CONFERENCE]

BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND
 SHRI KULDIP SINGH, JUDICIAL MEMBER

ITA No. 1479/DEL/2016
[Assessment Year: 2011-12]
 &
ITA No. 507/DEL/2017
[Assessment Year: 2012-13]

Microsoft India (R&D) Pvt. Ltd.,
807, New Delhi House,
Barakhamba Road,
New Delhi.
PAN: AABCM 6358 F
 [Appellant] 

Vs.

 DCIT,
 Circle-16(2),
 New Delhi.
[Respondent]

Date of Hearing : 09.06.2021
 Date of Pronouncement : 14.06.2021

 Assessee by : Shri Nageshwar Rao, Adv
 Ms Sherry Goyal, Adv
 Revenue by : Shri Surendar Pal, CIT-DR

ORDER

PER N.K. BILLAIYA, ACCOUNTANT MEMBER:-

 Pursuant to the directions given by the Hon'ble High Court of Delhi in ITA No. 247 of 2019 and 357 of 2019 order dated 04.01.2021, ITA No. 1479/DEL/2016 and ITA No. 507/DEL/2017 were heard for adjudication of the issues restored by the Hon'ble High Court of Delhi vide its order dated 04.01.2021.

2. Representatives of both the sides were heard at length. Decision of the Hon'ble High Court carefully perused and facts on record duly considered.

3. The underlying facts are that the decision of the Tribunal in A.Ys 2011-12 and 2012-13 were challenged before the Hon'ble High Court of Delhi and the Hon'ble High Court of Delhi, while deciding the appeals before it, had the occasion to consider the following substantial grounds of appeal for A.Y 2011-12:

““(a) Whether impugned order is perverse and bad in law to the extent it upholds substantial variations to determination of arm’s length price in transfer pricing study in the face of clear,unambiguous and express finding by Transfer Pricing Officer that “It is emphasized that Transfer Pricing study was not rejected at all”?

(b) Whether conclusion in impugned order classifying software development services rendered by Appellant as “High end” in nature for purposes of Chapter X of the Act is (a) contrary to facts and law as also material on record, (b) perverse as it does not consider all relevant material on record, selectively considers statements recorded by Respondent in the course of Advance Pricing Agreement proceedings and (c) unlawful and unsustainable in law as same arises from gross misinterpretation of facts, law and agreement between parties? 

To know more in details find the attachment file