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2022 (2) TMI 1351 - AT - Income TaxTP adjustment - selection of MAM - Cost Plus Method (CPM) or Transactional Net Margins Method (TNMM) - HELD THAT:- AR at this juncture submitted that assessee do not object for the use of TNMM. Accordingly, ground no. 1 stands dismissed. Non considering the segmental results of international transactions, submitted before the DRP - as argued internal comparables available and sufficient data were filed before the DRP which were not considered for purpose of comparability analysis - HELD THAT:- Admittedly, the transactions in a controlled transaction with a related party and an uncontrolled transactions with unrelated parties will result into more appropriate bench marking of arm’s length price. Under the circumstances, if there is availability of sufficient data of internal comparables, the Ld.TPO first should have recourse to such internal compares before moving on to external comparables. Only on insufficiency of data in respect of internal comparables, support must be drawn from the external comparables. We therefore, direct the Ld.TPO to carry out detailed analysis of the international transactions using TNMM as MAM, based on the materials filed by assessee related to internal comparables. In the event the details filed are satisfactory, the determination must be confined to the internal comparables so filed by assessee. In the event, the details filed by assessee is not verifiable or not in accordance with law, the AO/TPO is open to carry out analysis in accordance with law. Ground raised by assessee stands allowed for statistical purposes.
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