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2017 (4) TMI 960 - AT - Income TaxTransfer pricing adjustment - selection of comparable - Held that:- Assessee is rendering software development research and other related services to its parent company, thus companies functionally different from the assessee need to de-selected from the final list of comparable. MAT adjustment - provision for gratuity and leave encashment - Held that:- The assessee has filed a revised computation of book profit as per the provision of Sec.115JB during the course of assessment proceedings, claiming that provision for gratuity and leave encashment forming part of the audited financial statements, was ascertained liabilities as it was recognised on the basis of actuarial valuation and is not in the nature of unascertained liabilities as referred in Explanation to Sec 115 JB of the Act. The AO has declined to delete the said adjustment and did not accept the assessee’s revised computation on the ground that the assessee has not filed the revised return of income. Even though the A.O. could not have entertained the said claim but it does not impinge upon the appellate authorities to entertain such a claim if all the facts are there on record. This has been so clarified by the Hon’ble Supreme Court itself in the case of Goetz India Ltd. (2006 (3) TMI 75 - SUPREME Court). Thus, we remit this matter back to the file of the AO to consider the assessee’s claim and if the claim is found admissible under the provisions of the law, then he shall allow the same after giving assessee opportunity to explain its case.
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