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2012 (6) TMI 572 - AT - Income TaxComputation of deduction u/s 10A - assessee submitted that the AO excluded communication charges from the export turnover without reducing from the same from the total turnover Held that:- As decided in Commissioner of Income-tax Versus Tata Elxsi Ltd.[2011 (8) TMI 782 (HC)]that when certain expenses incurred towards telecommunication charges attributable to the delivery of the computer software outside India are reduced from the export turnover, then they are to be reduced from the total turnover also - in favour of assessee. Transfer pricing adjustment - the assessee's case handed to the TPO for the determination of Arm's Length Price (ALP) - assessee contested that TPO has not adopted a uniform and consistent policy for adopting or rejecting the comparable for both the software services and the IT enabled services - Held that:- In the case of some of the comparable, TPO has stated to be in the business activity of software development, but they have not given any details or any bifurcation of their development and trading activities separately - if the activity of product development would be compared with the software development services offered by the assessee which are both functionally different grave injustice would be done - TPO cannot adopt or pick and choose different methodology or different filters for analyzing the transfer pricing adjustment for the same or similar type of activities - remand the issue to the file of the AO/TPO to reconsider the ALP adjustment in the light of these observations. If any information is sought to be used against the assessee, the same has to be furnished to the assessee and thereafter, taking into consideration the assessee's objections, if any, only then can the TPO proceed to take a decision. If the assessee seeks an opportunity to cross examine the party, the assessee shall be provided such an opportunity. standard deduction of plus or minus 5% to be given to the assessee, while making the transfer pricing adjustment - in favour of assessee for statistical purpose.
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