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2011 (10) TMI 666 - AT - Income TaxTransfer pricing adjustments - providing non sufficient opportunity - Held that:- Since the main contention of the assessee is that the Transfer Pricing Officer has not given sufficient opportunity we are of the considered view that the matter may be set aside to the file of the AO with the direction to obtain fresh report from the T.P.O. and the T.P.O. is directed to recomputed the transfer price after giving reasonable opportunity of being heard to the assessee. Entitlement to plus or minus 5% adjustment as per section 92C(2) - Held that:- Only one price has been determined under (most appropriate method) for evaluating arms length price, the question of applicability of proviso 2 of section 92C(2) does not arise. Therefore assessee, was not entitled to the concession of plus or minus 5% as prescribed in the said provision. Deletion of motor car expenses and payments for acquisition of motor cars - Held that:- Observations of the AO were correct as the vehicles were used wholly and exclusively by the appellant and therefore the ownership also was lying with the appellant. That the lessor was claiming depreciation cannot be the ultimate test for ownership of the lessor. On the other hand the CIT(A) wrongly held that the ownership did not pass on to the lessee and thus the financial charges or lease rent should be allowed. This is wrongly found as the lessor might have sold the assets to the lessee or the user of the vehicle. Disallowance of provision for replacement guarantee - Held that:- The provisions are based on the previous years data and based on the sales and AO himself has allowed the provisions made by assessee in Assessement year 2004-05 while doing the assessment u/s 143 itself we are of the view that assessee is entitled to deduction of provisions. Disallowance of advances written off - Held that:- As in the interest of justice we consider it fit to restore this issue to the file of AO for fresh verification and decide the same as per law after giving a reasonable opportunity of being heard to assessee.
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