Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2010 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2010 (4) TMI 840 - ITAT, DELHIArm’s length price adjustment - TPO concluded that Arm’s Length Price of international transactions relatede to commission on sales and payment of repair charges to AE’s on account of repair of equipment under maintenance contract has not been determined at all - grievance of the assessee is that if the TPO wants to determine the arms length price of international transaction with associate concern then he should work out the profit disclosed by the asesee on those receipts and compare that result with the comparables of independent cases, who have carried out similar international transactions with independent parties - Held that:- Force in the contention of assessee that the TPO ought to have considered the international receipts with the associate enterprises only while determining the profit shown by the assessee in such transaction if the PLI is lower than the one comes out from comparable cases only then he could make necessary adjustment. In the present case while working out the PLI shown by the assessee he included the domestic receipt which gives lesser figure and then compare this result with the comparable cases, after the comparison he applied the difference only to the international receipts. To our mind that is not the appropriate step permissible in law and the Ld. CIT(A) has rightly appreciated this aspect. Profit is more than the PLI determined by the TPO at 16.34%. Therefore there is no reason to examine the issue on the argument of assessee that TPO has not applied proper comparable while working out this PLI, because that issue will be an academic issue in the present case even if some of the cases are not of comparable then also PLI more than the one adopted by the TPO at 16.34 % canot be take on which is lower than the one shown by the assessee. The CIT(A) has though considered this aspect also before deleting the addition no reason to interfere in it, appeal of the revenue is dismissed
|