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2012 (10) TMI 434 - AT - Income TaxAddition on account of transfer pricing Whether AO issue notice u/s 133(6), to comparable companies to gather information in relation to transfer pricing If yes, information that was obtained u/s 133(6), whether the same was put across to the assessee Held that:- AO can collect information about comparable by issuing notices u/s 133(6). Any information obtained in the course of assessment proceedings has to be supplied to the assessee for its objections, if any. The absence of doing so leads to violation of fundamental principle of natural justice. Therefore case remand back to AO. Addition on account of foreign exchange fluctuation gain on export u/s 10A Whether forex gain from export is a part off profit used to calculate deduction u/s 10A - Held that:- Profit derived means profit of the business of the undertaking the same proportion as the export turnover bears to the total turn over of the business carried on by the undertaking. Profit has to be computed as normally understood without insisting on proximate connection between the business of undertaking and the profit. Therefore there is no dispute that foreign exchange fluctuation gain is in respect of export proceeds so amount represents income as it is in the revenue field. Allow in favour of assessee. Excess provision written back & miscellaneous income also constitute profit from business while claiming deduction u/s10A Disallowance of debonding charges Debonding charges treated as revenue expenditure by assessee Held that:- As the capital goods placed in the bonded area are subject to restrictions that they cannot be sold and they cannot be removed outside the area for use of self. This encumbrance is removed once the goods are cleared from the bonded area on payment of duty. The result is that the assessee can deal with the goods in any manner it desires including sale thereof. Therefore debonding charges should be treated as capital expenditure & added to cost/wdv of asset. Decision in favour of revenue.
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