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2016 (3) TMI 1210 - AT - Income TaxTPA - comparables selected by the TPO for determination of Arm's Length Price - Held that:- Referring to software development services undertaken by assessee companies dissimilar with that of assessee need to be deselected from final list of comparables. Benefit of tolerance range of +/- 5% as per the proviso to Section 92C(2) of the Act. If the difference of the price of the international transactions and average price of the comparables is within the tolerance range then the benefit of proviso to Section 92C(2) of the Act is available to the assessee. Accordingly, we direct the A.O./TPO that while computing the ALP after excluding certain comparables as directed by us, the benefit of the proviso to Section 92C(2) of the Act has to be considered. Exclusion of expenditure incurred by the assessee in foreign currency from export turnover - Held that:- Following the case of CIT v M/s Tata Elxsi Ltd. & Others [2011 (8) TMI 782 - KARNATAKA HIGH COURT] we direct the Assessing Officer to exclude the expenditure in the foreign currency from total turnover as well. Disallowance of computer software expenses by treating the same as capital in nature - Held that:- hWen the expenditure in the case of the assessee is towards application software then by following the decision of the co-ordinate bench of this Tribunal in the case of Broadman Communications Technologies Pvt. Ltd. [2015 (6) TMI 1122 - ITAT BANGALORE] we decide this issue in favour of the assessee.
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