Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2012 (10) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (10) TMI 404 - AT - Income TaxAdjustments made to the purchase price of imports from Associated Enterprises - rejection of CUP method claimed by the assessee - CIT(A) deleted the addition - Held that:- The assessee had furnished proper details to show comparable transactions of Non-AE parties which match with the transaction of the assessee with its AE. Persuing the chart reproduced from the order of CIT(A), it was observed that the rate of diamonds per carat varies between Rs. 38,561/- to Rs. 98,499/-. It was the submission of assessee that the transaction compared being in the immediate vicinity of the transaction entered into by the assessee with its AE is sufficient to prove that the price charged by its AE was comparable with price charged by Non-AEs. However, he could not produce details about the quality of the diamond mentioned with reference to invoices. Therefore, CIT(A) has wrongly accepted the CUP method and TPO was right in observing insuffciant details were furnished to prove the justification of applicability of CUP method. As the ALP can be worked out only with respect to international transaction of the assessee with its AE it is just and proper to restore this issue to the file of AO with a direction to verify the aforementioned calculations submitted by the assessee after giving the assessee reasonable opportunity of hearing and if the aforementioned calculations are correct then the difference being within the safe harbour of +/- 5%, no addition with regard to ALP should be made - in favour of revenue by way of remand.
|