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2013 (8) TMI 826 - ITAT MUMBAIAdjustment of arm's length price - CIT revised order of TPO and enhanced assessee's income - Assessee used Cost Plus Method to determine International transaction relating to purchase and Net Margin Method for sale - TPO has applied TNMM as most appropriate method for bench marking - Held that:- The Commissioner of Income Tax(Appeals) has determined the ALP by taking the TNMM as most appropriate method but at the entity level of the assessee. The Commissioner of Income Tax(Appeals) has arrived at the arithmetic mean of the comparables operating profit at 8.33% against the operating profit at the entity level of the assessee at 4.71% - sale price of the assessee is within the tolerance limit of 5% as per the proviso to section 92C(2) of the Income Tax Act, which is clear from the working of the Commissioner of Income Tax(Appeals) - The operating cost of the assessee is within the 5% tolerance range of the ALP determined by the Commissioner of Income Tax(Appeals), therefore, no adjustment is called for on this account. It is pertinent to note that the Commissioner of Income Tax(Appeals) has determined the arm's length by considering the entity level results of the assessee which includes all the international transactions, therefore, when the over all price of the assessee is within the range of 5% of ALP being the arithmetic mean then no adjustment is permitted - Decided in favour of assessee. Computation of book profit u/s 115JB - The assessee in the return of income has not increased book profit computed u/s 115JB on account of diminution in value of investment debited to the profit and loss account, however, during the assessment proceedings the assessee conceded the adjustment in view of the retrospective amendment in section 115JB with effect from 1.4.2004 by the finance Act 2009 - Assessing Officer has not examined this issue from the angle of the actual written of the amount as the assessee conceded the same - Following decision of CIT Vs Yokogawa India Ltd. [2012 (9) TMI 390 - ITAT BANGALORE] - Matter remitted back for fresh adjudication.
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