« From the Courts » Open DEMAT Account in 24 hrs  Karnataka High Court restrains Bengaluru-based Institute of Chartered Tax Practitioners India from enrolling candidates for its courses  Attachment on Cash Credit of Assessee under GST Act: Delhi HC directs Bank to Comply Instructions to Vacate  Income Tax Addition Made Towards Unsubstantiated Share Capital Is Eligible For Section 80-IC Deduction: Delhi High Court  Inordinate delay in income tax appeal hearings  Income Tax leviable on Tuition Fee in the Year of Rendering of Services: ITAT  Supreme Court invoked its power under Article 142 of Constitution to validate notices issued under section 148 as notices issued under section 148A. However the same shall be subject to amended provisions of section 149.  ITAT refuses to stay tax demand on former owner of Raw Pressery brand  Bombay HC sets aside rejection of refund claims by GST authorities  [Income Tax Act] Faceless Assessment Scheme does not take away right to personal hearing: Delhi High Court  Rajasthan High Court directs GST Authority to Unblock Input Tax Credit availed in Electronic Credit Ledger  Sebi-taxman fight over service tax dues reaches Supreme Court «  HC notice to Centre, state over advocates’ access to family... Airport Authority of India vs. CIT (Delhi High Court – Full... » Ranbaxy Laboratories Ltd vs. CIT (Delhi High Court) January, 06th 2012 AOs self-determination of ALP without referring to TPO is erroneous & prejudicial to interests of revenue   The assessee entered into international transactions with its AEs, the value of which exceeded Rs. 5 crores. The AO passed an order u/s 143(3) in which he recorded the finding that he had examined the transactions and found them to be at arms length and no transfer pricing adjustment was required to be made. The CIT thereafter passed an order u/s 263 on the ground that in view of Instruction No. 3 of 2003 dated 20.5.2003, the AO ought to have referred the issue to the TPO instead of himself determining the arms length price of the transactions and that the assessment order was consequently erroneous and prejudicial to the interests of the revenue. On appeal, the Tribunal (114 TTJ (Del) 1) upheld the revision order. On further appeal by the assessee, HELD dismissing the appeal: Though s. 92CA enables the AO to refer an international transaction to the TPO if he considers it necessary or expedient to do so, Instruction No. 3 dated 25.5.2003 makes it mandatory for the AO to make a reference to the TPO if the aggregate value of the international transaction exceeds Rs. 5 crores. This Circular, having been issued u/s 119, is binding on the AO. The AO ought to have referred the matter to the TPO having regard to the fact that Specialized Cell was created to deal with complicated and complex issues arising out of the transfer mechanism. The AOs omission to follow the binding Circular amounted to making assessment without conducting proper inquiry and investigation and resulted in the order becoming erroneous and prejudicial to the interest of the Revenue. The observations in Sony India 288 ITR 52 (Del) (while upholding the constitutional validity of the aforesaid Circular) that the said Circular was a Guideline which did not take away the discretion of the AO was made in a different context.