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2015 (12) TMI 961 - AT - Income TaxTransfer pricing adjustment - adoption of Most Appropriate Method (MAM) - Held that:- We direct the TPO to adopt RSPM as the MAM in this case. Transfer pricing adjustment of AMP expenses - Held that:- As agreed by both the parties this issue is set aside to the file of the AO/TPO for fresh adjudication in line with the propositions laid down by the Special Bench of the Tribunal in the case of L.G.Electronics India [2013 (6) TMI 217 - ITAT DELHI] Treating foreign exchange loss as an item of non operating expenditure - Held that:- The Ld.Counsel for the assessee agreed with the contention of the Ld.D.R. that safe harbour rules should not be the basis of decision making. In view of the above contentions, we modify the directions of the DRP to the extent that safe harbour rules should not be applied while considering foreign exchange fluctuation loss while arriving at net operating margins. Decided in favour of revenue Addition on prior period expenses - Held that:- None of the expenditure identified by the AO has been claimed in AY 2009-10, as the relevant provisions were made in AY 2008-09 and the said provision expenditure ahs been allowed by the AO in AY 2008-09. Thus, the addition proposed by the AO does not survive - Decided in favour of assessee. Relief granted by the DRP on account of provision for warranty - Held that:- On the ground that the assessee has made provisions of warranty on a consistent and rational basis, the dRP directed the AO to grant deduction. We find no infirmity in this finding. Hence this ground of the Revenue is dismissed. - Decided in favour of assessee. Disallowance made u/s 40(a)(ia) with respect to advertisement expenditure - DRP delted the addition - Held that:- The DRP recorded that the assessee had complied with the statutory requirement of deducting tax at source and hence the disallowance u/s 40(a)(ia) is not warranted. There is no infirmity in this finding and hence this ground of Revenue is dismissed.- Decided in favour of assessee.
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