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2016 (6) TMI 1293 - AT - Income TaxTPA - comparable selection - Held that:- Assessee has provided software development services to its Associated Enterprises, thus companies functionality dissimilar with that of assessee need to be deselected from final list. We direct the TPO to consider the risk adjustment of the margins of comparables for bringing them on par with the assessee. Nature of expenditure - web site creation expenses - revenue or capital - Held that:- Without going into the controversy of allowable revenue expenditure we are of the view that even if this expenditure is considered as capital in nature, the assessee is entitled for depreciation on the entire expenditure incurred once the work of web site creation is completed. The A.O has already allowed the depreciation for the asst. year 2010-11. Therefore, we uphold the orders of the authorities below treating the said expenditure as capital in nature, however, the assessee may claim depreciation on the entire amount from the year in which the work is completed and the asset has come into existence. Exclusion of freight charges, telecommunication charges, insurance charges, travelling and financial charges from the export turnover as well as total turnover while computing the deduction u/s. 10A - Held that:- Hon’ble Karnataka High Court in the case of CIT v M/s Tata Elxsi Ltd. & Others (2011 (8) TMI 782 - KARNATAKA HIGH COURT) had held that while computing the exemption u/s 10A, if the export turnover in the numerator is to be arrived at after excluding certain expenses, the same should also be excluded from the total turnover in the denominator.
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