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2018 (10) TMI 583 - ITAT KOLKATATPA - ALP adjustment - methods prescribed under the Act for determination of the ALP of these inter-group services - determination of ALP of the international transaction of payments made under CCA, at NIL by the TPO - Held that:- The factual findings of the Ld. DRP that I.T. services were utilized by the assessee for its own business purpose and any independent enterprise would have to ask and pay for such services is not disputed. We agree with the view of the Ld.CIT(A) that there services are not stewardship services. The arguments and facts have been analysed in details. We do not find any infirmity on the same. Services were rendered and the assessee received benefits. Hence, we hold that the order of Ld.CIT(A) for AY 2009-10 & 2010-11 and Ld. DRP of AY 2011-12 are upheld. Coming to the submissions of the Ld.DR that the issue should be remanded back to the file of the TPO for fresh adjudication, we find that the payment in question was admittedly reimbursement of cost. When the issue of deduction of tax at source on the very same payments had come up before the Tribunal in the assessee’s own case for AY 2002-03 and the subsequent years, it was held that these were reimbursement of actual cost and hence no tax may be deducted at source on these payments. Moreover, the conditions specified in section 92CA r.w.s 92C(3) are not complied with the TPO. Hence, no purpose could be served in restoring the issue back to the file of TPO for fresh adjudication for determination of ALP. As decided in case of NALCO INDIA [2016 (3) TMI 639 - ITAT KOLKATA]The paragraph no. 7. 12 of the OECD Guidelines provides that there are some cases where an intra-group service perforated by a group member such as a shareholder or coordinating centre relates only to some group members but incidentally provides benefits to other group members.he incidental benefits ordinarily would not cause these other group members to be treated as receiving intra-group services because the activities producing the benefits would not be ones for which an independent enterprise ordinarily would: be willing to pay. But in the instant case no such benefits such as those mentioned in paragraph no. 7. 12 of the OEC]) Guidelines accrued to assessed under the agreement and hence, no incidental benefits accrued under the agreement. Accordingly, we are of the view that the first ground for confirming disallowance by CIT(A) that no independent documentary evidence had been furnished by assessed to show that the fact of actual services having been rendered to assessed and Nalco Pacific too could not substantiate the claim 6or provision of actual services with documentary evidence, has no leg to stand. Also in SCHNEIDER ELECTRIC INDIA PRIVATE LIMITED VERSUS DY. COMMISSIONER OF INCOME TAX, CIRCLE 1 (2) , VADODARA [2017 (6) TMI 392 - ITAT AHMEDABAD] held it cannot be open to the TPO to reject a method of ascertaining the arm's length price without fining a legally permissible method to substitute for the method of ascertaining ALP as adopted by the assessee. To hold that the arm's length price of these services was NIL under the CUP method. the TPO had to necessarily to demonstrate that the same services. whatever be its intrinsic worth. were available for NIL consideration in an uncontrolled situation: that is not. and that cannot be. the case. It is also not the case of the authorities below that the arm's length price of these services, under any other legally permissible method is, NIL There is thus no legally sustainable foundation for the impugned ALP adjustment. - decided against revenue
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