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2018 (3) TMI 299 - AT - Income TaxAdjustment made to export turnover on account of freight, telecommunication and insurance, on-site fees and marketing fees - Held that:- Justification in excluding the above mentioned expenditure both from the export turnover as well as from the total turnover while calculating deduction under section 10A of the Act. Allowing deduction u/s. 10A - Held that:- As decided in Black and Veatch Consulting Pvt. Ltd. [2012 (4) TMI 450 - BOMBAY HIGH COURT] deduction under section 10A has to be given at the stage when the profits and gains of business are computed in the first instance. The Tribunal was right in holding that the deduction under section 10A in respect of the allowable unit under section 10A has to be allowed before setting off brought forwarded losses of a non-section 10A unit. Transfer pricing (TP)adjustments - comparable selection criteria - Held that:- We find that the assessee in engaged in the business of software development, that it had adopted TNMM for benchmarking the IT's, thus companies functionally dissimilar with that of assessee need to be deselected from final list. Seven comparables have to treated as invalid comparables for the year under consideration, as stated earlier. We find that if the above referred seven comparables are not included in the final list, then the average margin of the assessee is within the range of (+/-)5%. Therefore, we hold that adjustment made by the TPO and confirmed by the FAA have to be deleted. - Decided in favour of the assessee.
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