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2011 (9) TMI 453 - ITAT DELHITransfer Price - Calculation of "Arm Length Price" - Assessee selected Transactional Net Margin Method(TNMM) - Profit level Indicators were determined by dividing operating Income with Operating Cost - only dispute between the parties is inclusion of other income in the operating income of comparables and exclusion of miscellaneous expenses - Held that:- assessee has accepted almost all the objections of the Learned DR - Determination of Arm Length price is not a mathematical formula rather scientific mechanism - we are of the view that some element of guess work, estimation is always involved for determining the ALP of international transactions. The arithmetic mean of the comparables is 6.84% in the first analysis and 5.63% in the second analysis extracted supra. The average profit margin shown by the assessee is 1.96% which is within the tolerance band of +/- 5%. Thus appeal of revenue was dismissed.
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