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2016 (4) TMI 1280 - AT - Income TaxTPA - comparable selection criteria - Held that:- the addition is to be confined only to the component of transactions with associate enterprises alone and not to the entire segmental results. Where separate data is not available, then the principle of proportionality is to be applied and where the data relating to control and uncontrolled cost price is not available, then proportionate sales relatable to international transactions with its associate enterprises i.e. controlled cost has to be worked out and the addition, if any, is to be confined to the component of international transactions with its associate enterprises alone and not to the entire segmental entity. Assessing Officer/TPO directed to consider profit margins of only engineering design services segment and the same be applied to benchmark the international transactions entered into by the assessee with its associate enterprises. The assessee was in the business of rendering designing and developing services relating to products in CAD/CAM of auto parts and also customer support servicing and techno marketing services to its associate enterprises i.e. TACO and Visteon International Holdings, USA, thus companies functionally dissimilar with that of assessee need not to be added to final comparable list. Erroneous computation of deduction under section 10A - claim of the assessee was rejected, in view of the assessee being agreed to exclude the expenditure incurred in foreign currency from export turnover and total turnover - Held that:- In view of the ratio laid down by the Hon’ble Bombay High Court in CIT Vs. Pruthvi Brokers & Shareholders Pvt. Ltd. (2012 (7) TMI 158 - BOMBAY HIGH COURT) the appellate authorities had power to consider the claim not made in the return of income. The Tribunal in turn, following the same directed the Assessing Officer to compute the deduction under section 10A of the Act as per law after giving an opportunity of hearing to the assessee. The learned Authorized Representative for the assessee pointed out that during the assessment proceedings relating to the instant assessment year i.e. 2009-10, this plea was raised before the Assessing Officer. However, following the consistency, since the issue has been set-aside to the file of Assessing Officer in the preceding year, we direct the Assessing Officer to compute the deduction under section 10A of the Act in accordance with law and in line with the directions of Tribunal in assessment year 2008-09. The Assessing Officer shall afford reasonable opportunity of hearing to the assessee. The ground of appeal No.11 raised by the assessee is thus, allowed for statistical purposes. The grounds of appeal raised by the assessee are partly allowed.
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