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2018 (5) TMI 1849 - ITAT CHENNAITP adjustment - comparable selection - consideration of appropriate risk related adjustment - HELD THAT:- Essential requirement for allowing a risk adjustment is that the assessee should have quantified and claimed the risk adjustment in its TP documentation based on a clear and logical workings, considering the risk profile of tested party and comparables companies and not based on surmises. Just because assessee was serving a single customer would not mean that it was bearing market risk different from any other competitor. As already mentioned by us, assessee had simply estimated risk adjustment at 5% without properly quantifying the difference in the risk profile between assessee and M/s. Suprajit Engineering Ltd. We are of the opinion that lower authorities were thus justified in not allowing the risk adjustment claimed by the assessee. Grounds of the assessee stand dismissed. Inclusion of loss on forex exchange as part of operating expenditure - HELD THAT:- This Tribunal in assessee’s own case for assessment year 2012-2013 , this issue is squarely covered by the judgement of Madras High Court in the case of CIT Vs. Pentasoft Technogies Ltd. [2010 (7) TMI 75 - MADRAS HIGH COURT] decide the issue against the assessee holding that foreign exchange loss is a part of operating expenditure 'Working Capital Adjustment' for Determination of arm's length price by the TPO’’ - non production sufficient data for proving its claim of working capital adjustment. - HELD THAT:- The basis of the calculation was the number of days of holding of the inventory, receivables and creditors of the comparables viz-a-viz the assessee. However, while working out the rate of interest for calculating working capital adjustment, assessee had considered the prime lending rate @18.5% and this is clear which gives the work-out of the working capital adjustment. There is nothing on record to show that the interest paid by the assessee or the comparables, on their respective loans were at the rate of 18.5% or the rates were significantly different. This in our opinion reduced the claim of working capital adjustment at 3.18%, to a mere estimate. Actual interest paid was never considered by the assessee. Hence, we are of the opinion that lower authorities were justified in taking a view that assessee had not produced sufficient data for proving its claim of working capital adjustment. We do not find any reason to interfere with the orders of the lower authorities. Ground of the assessee stands dismissed. Disallowance of employees contribution to Provident Fund/ remitted after the due date mentioned in the relevant statute, but before the due date of filing the return of income - HELD THAT:- The issue raised by the assessee is covered by the judgment of Hon’ble Jurisdictional High Court in the case of CIT vs. Industrial Security & Intelligence India Pvt. Ltd [2015 (7) TMI 1063 - MADRAS HIGH COURT]. Assessee having remitted the amount before due date of filing of return, by virtue of the above judgment of Hon’ble Jurisdictional High Court a disallowance could not have been made. Such disallowance stands deleted. Ground of the assessee is allowed.
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