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2022 (5) TMI 1541 - ITAT DELHITP Adjustment - Specified Domestic Transactions [SDT] undertaken by the assessee qualifying for ALP principle envisaged under the Act - assessee alleged that Section 92BA(1) has been omitted by the Finance Act, 2017 and, therefore, the impugned order should lapse and become invalid in law. HELD THAT:- The undisputed fact is that as per sub-clause (1) of section 92BA of the Act, the assessee has undertaken the transaction which has exceeded the prescribed limit. It is also not in dispute that vide Finance Act, 2017 w.e.f. 01.04.2017 the said sub-clause (1) of section 92BA has been omitted. We find that the AO has made a reference u/s 92CA of the Act having observed that the assessee has entered into specific domestic transaction as the case is covered u/s 92BA of the Act. Respectfully following the decision of the co-ordinate bench [2017 (12) TMI 1719 - ITAT BANGALORE] which has been upheld by the Hon'ble High Court of Karnataka [2019 (12) TMI 1312 - KARNATAKA HIGH COURT] we have no hesitation in holding that the cognizance taken by the Assessing Officer u/s 92CA is invalid and bad in law. Therefore, the consequential order passed by the TPO and DRP is also not sustainable in the eyes of law. Applicability of provisions of section 40A(2) of the Act on the impugned transactions cannot be ruled out - As in the interest of justice and fair play, we restore this issue to the file of the Assessing Officer. The AO is directed to examine the impugned transaction in light of provisions of section 40A(2) of the Act after affording reasonable and sufficient opportunity of being heard to the assessee.
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