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2014 (5) TMI 742 - AT - Income TaxValidity of DRP’s order u/s 143(3) r.w.s 144C of the Act – Rejection of transfer pricing documentation – Transfer pricing adjustment – Selection of comparables – Held that:- The Assessing Authority has to follow the directions of the DRP and this mandate is contained u/s. 144C(10) of the Act - the DRP has merely recorded a finding that Cyber Media (India) Online Ltd. is broadly comparable to the assessee company - The finding appears to be a finding necessary for disposal of objections raised by the assessee to the proposed assessment order made by the assessing authority - it is not that same thing as directions of DRP which it is empowered to give u/a 144C(5) r.w.s 144C(10) of the Act - The peculiar finding so given by DRP was merely for the guidance of the assessing authority and not a binding direction - If the assessing authority committed any procedural lapse in taking guidance from the finding, such a lapse does not impinge upon the legality of the order framed within the powers vested in him under the Act - the assessment cannot be held to be void or infructuous in the case. The assessing authority is the best judge of the situation and has to arrive at its conclusion without any bias and on rational basis - The Appellate Tribunal shall by itself not embark enquiry afresh into the facts and comment upon the similarities or dissimilarities of the comparables on the basis of new pleas which in fact is under the domain of the assessing authority - It is also claimed by the assessee and has fairly being admitted by the Revenue that the assessee did not have reasonable and effective opportunity of explaining its case before the authorities – thus, the matter is remitted back to the Assessing Authority for fresh adjudication – Decided in favour of Assessee.
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