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2018 (4) TMI 444 - AT - Income TaxTPA - intragroup services in lieu of which assessee made payments to its associated enterprise - Assessee is engaged in providing of software development services, software deployment services, consultancy services, training services, software sublicensing and AMC activities - Held that:- On perusal of the order passed by this Tribunal in assessee’s own case for assessment year 2007-08 as well as 2008-09, it is observed that the issue has been set aside to Ld.TPO for considering evidences filed by assessee and to decide the issue as per law. In the facts of the present case before us, it is submitted that assessee already filed all relevant details before Ld.TPO and DRP which have not been considered while deciding this issue. We direct Ld.TPO to examine these evidences filed by assessee to establish the fact of having availed such services from AE and to decide the issue as per law. Addition in respect of interest paid by assessee on advances received from associated enterprises - Held that:- Set aside this issue to be decided in the light of evidences/invoices placed on record by assessee before Ld.TPO and TP Report in respect of receivables as well as payables. In the event it is established that the receivables as well as payables relate to assessee & AE inter se, then netting off shall be granted. On the contrary if it is established that only receivables are in the nature of loan then interest at the market rate shall be applied. Adjustment of provision of software development services and software consultancy services - Held that:- As we have already set aside the ground relating to management fees being ground No. 4 to Ld. AO for verification of the issue in the light of the evidences already placed on record, this ground now becomes infructuous. Disallowance of software license fees - revenue v/s capital expenditure - Held that:- We are at loss to appreciate as to how the assessee can be said to have created an 'Intangible asset' by paying the Licence fee to its AE in respect of sales made. Such payment @ 45 % of the invoice value was the obligation of the assessee ab initio without which it could not have procured the license of ENTERPRISE suite for sale in India. This amount can be loosely characterized as cost of goods transferred to the customers in India, which has necessarily to be allowed as a revenue expenditure. Similar view has been taken by the tribunal in its order for the immediately preceding year. We, therefore, overturn the impugned order on this score and direct the deletion of addition
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