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2016 (7) TMI 1396 - HC - Income TaxTPA - computation of ALP - transactions of intra-group services - Held that:- Obligation under the Indian law is to compute the income from an international transaction between two AEs having regard to its ALP and the same is required to be strictly determined as stipulated. The contention, that the foreign AE be considered as a tested party and then foreign companies be considered as comparable for determining the ALP of the international transaction, having no statutory sanction, is sans merit and hence jettisoned. To sum up, we hold that the methodology adopted by the assessee for computation of ALP in respect of its international transactions of intra-group services by choosing foreign AE as a tested party is completely unfounded and deserves to be and is hereby rejected in entirety. We hold that the argument of the ld. AR for selection of foreign AE as a tested party is neither legally sustainable nor acceptable on the yardstick of his own contention. We, therefore, direct that the assessee itself should be considered as a tested party. In doing the exercise of determination of the ALP, the TPO/AO, having due regard to the discussion made above, will first adopt the assessee as tested party and then decide about the most appropriate method after considering the availability of the relevant data. Needless to say, the assessee will be allowed a reasonable opportunity of being heard. Disallowance by denying depreciation in respect of vehicles given on lease - Held that:- Issue of depreciation of leased vehicles requires restoration to the file of AO. See M/s ICDS. LTD. Versus CIT-A [2013 (1) TMI 344 - SUPREME COURT] Interest on sticky loans and advances could not be charged to tax. See Hon’ble Supreme Court in the case of UCO Bank vs. CIT (1999 (5) TMI 3 - SUPREME Court)
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