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2022 (5) TMI 1423 - AT - Income TaxTP Adjustment - ALP of international transaction of assessee - selection of MAM - Assessee seeked to change most appropriate method from TNMM to the ‘other method’ - adoption of ‘other method’ prescribed under Rule 10AB of the Income Tax Rules as the most appropriate method for benchmarking services income - HELD THAT:- We see no harm in allowing the assessee to change most appropriate method from TNMM to the ‘other method’. This is more so because, the original MAM i.e. e Transactional Net Margin Method adopted by the assessee in its Transfer pricing study report is without any analysis and learned Transfer Pricing Officer accepted the same without proper examination. DRP rejected only for the reason that now assessee cannot change the method which it has accepted as most appropriate method earlier. Further, whether the quotation can be accepted as benchmarking evidence under Rule 10BA is also supported by the decision of Hon'ble Delhi High court In Toll Global Forwarding Limited [2015 (12) TMI 1513 - DELHI HIGH COURT] as well as co-ordinate Bench in Gulf Energy Maritime Services Pvt. Ltd. [2016 (3) TMI 216 - ITAT MUMBAI]. In view of this, we hold that assessee can adopt ‘other method’ prescribed under Rule 10AB of the Income Tax Rules as the most appropriate method for benchmarking services income received by the assessee from its associated enterprises. Also assessee has submitted additional evidence in the form of comparables quotations from third party service provider in support of rates charged by the assessee. We find that these evidences at page no. 463 of the Paper Book is the rate quoted by Enser Communication Pvt. Ltd to the Associated Enterprises on 6th January 2020, of $ 10 per login hour. Similarly, at page no. 475 Rhombus on 14th September 2012 has quoted man hour rate of $ 8.5. Further at page no. 475 Synergies outsourcing Pvt. Ltd. vide quotation dated 28th January 2020 has also given the rate of $ 10 per man-hour. As these quotes are available with the Associated Enterprises for similar services, therefore, the FAR of these quotes are similar with the agreement of the assessee, hence, comparable. However, we hastened to say that website rates could not be accepted without proper examination of FAR and other comparability. But for the reason that As the rates charged by the assessee is higher than the rates quoted by third party suppliers which is permissible in the ‘other method’, we hold that the international transactions carried out by the assessee is at arm’s length. In view of this, we allow ground no. 1.3 of the appeal of the assessee.
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