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2016 (12) TMI 1414 - HC - Income TaxDetermination of arm's length price under Section 92C - whther net profit margin of the comparable company is required to be adjusted to bring the international transaction by the assessee Company and that of the comparable company at the same pedestal? - Held that:- Tribunal, after rightly observing that the adjustments in the net operating profit margin on account of any strike etc. was to be made in the profit margin of the comparable company, erred in rejecting the case of the assessee Company on the ground that the assessee had failed to bring on record any material to show that the profit of the comparable companies had been hit by a strike. The profit margin of the comparable company was required to be adjusted after taking into account a strike like situation as had taken place in the assessee company. Our order would show that qua question no. 1, we have upheld the order of the Tribunal remitting the matter to the TPO for fresh assessment in accordance with law. Questions no. 4 and 5 are also to be decided afresh. While deciding question no. 1, the second question would also be considered and decided by the TPO on making appropriate adjustments in the profit margin of the comparable company after taking into account a strike like situation in the comparable company as had taken place in the assessee Company.
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