2012 (5) TMI 314 - ITAT DELHI

Transfer pricing - arm's length price - extraordinary expense - selection of comparable - held that:- Since the adjudication on this issue has resulted in operating margin of the assessee at 17.80% which is higher than the operating margin of 17.09% earned by the comparable companies selected by the TPO, international transactions undertaken by the assessee satisfies the arm's length criteria. - In such scenario, as agreed by both the counsel, adjudication of another Transfer Pricing issue in this regard is infructuous.

Expenditure on activity of the shifting of office versus re-establishment of business - held that:- The said expenses incurred on relocation of the office are essentially revenue expenses in as much as it did not result in enduring benefit in the capital field - allowed as revenue expenditure.

Recruitment expenses - revenue or capital - held that:- the assessee incurred an aggregate amount of Rs. 20,70,000/- as recruitment expenses, being expenses incurred in relation to hiring of employees, which were paid to consultants and for advertisement and other incidental expenses as revenue expenditure. We agree that the aforesaid expenditure are essentially on revenue account and did not result in either an enduring benefit in capital filed or creation of capital assets - Decided in favor of assessee.