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2015 (12) TMI 684 - AT - Income TaxTransfer pricing adjustment - selection of comparable as loss making company - Held that:- When loss making company has been selected for comparison in TP study for necessary, which is profit making one, there is a need for more attention qua the conditions prescribed in clause (a) to (d) of Rule 10B(2) of IT Rules, 1962 for an ultimate judgment of comparability of impugned transaction. So, the persistent loss making means continuous loss making for more than 3 years but in the case before us i.e. Stovec has earned a margin of 2.39% in comparable segment in F.Y. 2003-04. Hence, it could not be considered as loss making, so the same should be excluded for computing operative margin of comparable companies for arriving at ALP in relation to international transactions pertaining to EOU operations. The Assessing Officer is directed accordingly. Commission on marketing of machines and commission of marketing of spares - Held that:- The Tribunal further held that the international transactions pertaining to receipt of commission from marking of machines benchmarked by the assessee aggregating with domestic operations using TNMM should not be rejected. Nothing contrary has been brought to our knowledge on behalf of Revenue. Facts being similar, so following the same reasoning, Assessing Officer is directed to grant of relief to the assessee for the year under consideration i.e. A.Y. 2006-07 on the line of A.Y. 2007-08 discussed above.
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