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2016 (9) TMI 148 - AT - Income TaxTransfer pricing adjustment - MAM - Held that:- CUP method provides the most direct comparison for the purpose of determining the arm's length price of international transactions and is to be preferred over the other profit based methods. Accordingly in the instant case internal CUP method should be preferred over the external CUP method. Hence, we hold that in the instant case, the CUP Method (internal) is the most appropriate method in determining the arm's length price of the international transaction involving export of PCBs by the assessee to AE and accordingly, delete the adjustment made in the assessment order. Disallowance on account of diminution in the value of inventories - Held that:- In the instant case, the assessee inadvertently added back the negative balance of the opening and closing provisions made for diminution in the value of inventories in the return filed which should have otherwise reduced from the total income of the appellant. Later on, realizing the inadvertent mistake, the assessee filed a written submission before the AO dated 2nd March, 2015 praying before the AO to allow the deduction of the excess provision which was inadvertently added back. The same was turned down by the Assessing Officer on the alleged ground that the same could only be rectified by a revised return and as the appellant has not filed the revised return the same could not be entertained even after accepting the fact that the appellant should have been allowed with the claim. Now the question before us arises whether the deduction can be allowed without filing the revised return. We are inclined to reverse the order of authorities below and delete the disallowance made by the Assessing Officer / DRP amounting in respect of the negative provisions for diminution in the value of inventories.
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