2022 (8) TMI 893 - ITAT DELHI

TP adjustment - comparable selection - functional dissimilarity - HELD THAT:- Companies functionally dissimilar and diversified services with that of assessee software service provider need to be deselected from final list.

Disallowance of expenses on non-deduction of tax - Non deduction of TDS Freight charges u/s 194C and Expense on hotel accommodation u/s 194I - As submitted deduction u/s 10A of the Act shall be computed on the assessed income after considering all the allowances/disallowances made by the AO during the assessment proceedings - HELD THAT:- AO, on the basis of the TDS Survey, conducted and order passed by the ITO, TDS made addition on account of Freight charges and expense on hotel accommodation by invoking the provisions of section 40(a)(ia) of the Act. Without going into the merit of the addition, we find the alternate argument of the ld. Counsel for the assessee acceptable according to which once the assessee is entitled to deduction u/s 10A of the IT Act, then, such higher assessed income on account of disallowance made by the AO is eligible for deduction u/s 10A. Since the assessee is entitled to deduction u/s 10A of the Act, therefore, the assessee is entitled to deduction u/s 10A of the Act on such enhanced assessed income due to disallowance of the expenditure on account of freight charges and expenses on hotel accommodation. We, therefore, allow the ground of appeal by the assessee.