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2013 (11) TMI 817 - AT - Income TaxDetermination of ALP by TPO – Selection of comparables – Held that:- Rule 10B(4) makes it clear that only the data relating to the relevant financial year has to be relied upon for computing the OP/TC margin of the comparable company. Therefore, when the current year data of the comparable companies were available on public domain, the TPO was not justified for using multiple data in violation of Rule 10B(4) of I T Rules - The average OP/TC margin of comparable companies, even after including Hinduja TMT Ltd., as a comparable, comes to 8% which is much below the margin of 11.03% shown by the assessee - No adjustment can be made to the arm's length price declared by the assessee – Decided against the Revenue. No opportunity to the TPO while disturbing the margins by adopting financials – Held that:- TPO has used multiple year data for arriving at the average OP/TC margin of the comparable companies. Whereas Rule 10B(4) of IT Rules specifically provides for considering the current year data of the comparable companies unless it falls within the exception as provided in proviso to Rule 10B(4). It is also a fact on record that current year data of the comparable companies were available in public domain. The CIT (A) has simply followed the statutory provision while determining the OP/TC margin of the comparable companies by applying the current year data, hence in these circumstances, the grievance of the department that no opportunity was granted to the TPO cannot be accepted – Decided against the Revenue.
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