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2020 (9) TMI 65 - AT - Income TaxTP Adjustment - determining the Arm’s length price of the international transaction of reimbursement of expenses paid to the associated enterprises determined by the ld TPO at Rs. Nil - HELD THAT:- As decided in own case [2020 (4) TMI 749 - ITAT DELHI] in the instant case, the assessee has incurred expenditure and not making payment of mark-up is not adverse to the entity in Indian Jurisdiction. The assessee has claimed the expenditure paid by the AE on its behalf. The contention of the TPO is that the assessee was not required to incur the said expenses. But it was under jurisdiction of the AO whether particular expenditure was incurred wholly and exclusively for the purpose of business and not in the domain of the TPO to hold that in view of the warranty etc., the assessee was not required to incur expenditure on firewall charges. Contention of the assessee seems plausible that motors were required to checked for content of moisture acquired in transport from India to the USA, i.e., the destination point and it was the responsibility of the assessee to provide defect free motors to the end customers. Thus, respectfully following the finding of the Hon'ble Delhi High Court [2012 (4) TMI 346 - DELHI HIGH COURT] we delete the transfer pricing adjustment. We direct the ld AO/ TPO to delete the adjustment arising on account of determination of ALP of the international transaction of reimbursement of expenses paid by the assessee to its associated enterprises on account of testing charges.
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