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2020 (3) TMI 335 - AT - Income TaxTransfer pricing adjustment - MAM selection - TNMM or CUP - HELD THAT:- DRP rejected the assessee-company's contentions without assigning reasons whatsoever. The assessee also contends that the TPO as well as DRP had not assigned any reason as to why CUP method is not most appropriate method in the nature of transactions assessee company had with its AE. It was also submitted that TPO has not considered the alternative submissions of the assessee company that in case TNMM is adopted as the most appropriate method, same should be applied based on internal comparables rather than external comparables. Now, law is quite settled that internal comparables are more preferable to external comparables. Finally, learned authorised representative of the assessee submitted that the TPO had not considered the submissions of the assessee-company for adjustment towards unutilized capacity. AO also not followed directions of the DRP while passing final assessment order. In the circumstances, it was prayed that the matter may be restored back to the file of the AG for de novo consideration. CIT(DR) had no serious objections for restoring the matter back to the file of the AO/TPO for fresh analysis of TP study. In the circumstances, we remit the matter back to the AO to consider the above submissions de novo after affording due opportunity of being heard to the assessee company. Deduction u/s 10A - HELD THAT:- Ground raised by the revenue is covered against the revenue by the decision rendered by Hon’ble jurisdictional Karnataka High Court in the case of Tata Elixi Ltd [2011 (8) TMI 782 - KARNATAKA HIGH COURT] . Requirement of considering the issue of deduction of foreign expenses from both export turnover and total turnover shall arise only if the additional ground urged by the assessee is decided against the assessee, i.e., if the additional ground is decided in favour of the assessee by holding that there is no requirement of deducting foreign expenses from the export turnover, then the ground urged by the revenue shall become infructuous. AO has actually allowed deduction u/s 10B of the Act. The Ld DRP has referred to both sec.10B and 10A in its directions. The grounds urged by both the parties refer to sec.10A only. Thus, there is confusion about the section under which the deduction was claimed by the assessee. Disallowance of Provision for doubtful debts claimed by the assessee u/s 36(1)(vii) - HELD THAT:-Since the impugned claim has not been examined by the AO in terms of 36(1)(vii) of the Act, we restore this issue to his file for examining the same afresh. “Provision for Gratuity” is an ascertained liability eligible to be deducted from the Net profit for the purpose of computing book profit u/s 115JB - HELD THAT:- Provision for gratuity is an ascertained liability eligible to be deducted from net profit for the purpose of computing book profit u/s 115JB
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