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2019 (6) TMI 144 - AT - Income TaxTP Adjustment - working capital adjustment - Credit period ratio of 85 days of comparables the credit period ratio of the assessee is 1118 days - HELD THAT:- In principle, we agree with the contention of the learned Authorised Representative that adjustment on account of working capital has to be made while computing the margin of the comparables. The Tribunal, Kolkata Bench, in Dong Fang Electric India Pvt. Ltd. [2019 (4) TMI 1427 - ITAT KOLKATA] has laid down certain parameters for working capital adjustment. It is the contention of AR, that a working of margins of the comparables after providing for working capital adjustment following the parameters laid down in case of Dong Fang Electric India Pvt. Ltd. (supra) has been placed on record vide paper book Page no.–81. In view of the aforesaid, we direct the Assessing Officer/Transfer Pricing Officer to verify the computation of working capital adjustment made by the assessee and compute the margin of the comparables and determine the arm's length price of the international transaction. Accordingly, this ground is allowed. Inclusion of unutilized MODVAT credit to the value of the closing stock/opening stock u/s 145A - HELD THAT:- Tribunal in assessee’s own case [2018 (4) TMI 35 - ITAT MUMBAI] while deciding identical issue, in the order referred to above, has upheld the decision of learned Commissioner (Appeals) in directing the Assessing Officer to include the unutilized MODVAT credit to the value of closing stock and allow consequential effect to the opening stock.
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