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2015 (1) TMI 773 - ITAT BANGALORETransfer pricing adjustment - payment of management fee unwarranted - Held that:- When the assessee claims that the assessee has paid the management fee to the AE, no doubt the burden is on the assessee to prove that it has received services from its AE. But when the assessee has produced such material before any of the authorities below it is also the duty of the authorities to consider the same before coming to any conclusion on merits. In view of the same, without verification of proper evidence, it not justified to come to the conclusion that payment of management fee of ₹ 1.55 crore is unwarranted. In view of the same, we set aside the order of the AO on this issue and remit the issue to the file of the AO/TPO for readjudication of the issue and re-determination of the arm’s length price in accordance with law. The assessee shall also be given an opportunity to produce all the relevant materials before the AO and the assessee shall co-operate with the AO for early determination of the arm’s length price by the AO/TPO. Decided in favour of assessee for statistical purposes. Disallowances in computation of deduction u/s 10A - Held that:- When two reasonable constructions are possible, then the construction in favour of the assessee must be adopted. Thus the decision of the Hon’ble Karnataka High Court in the case of Yokogawa India Ltd.(2011 (8) TMI 845 - Karnataka High Court ) holds the field stating that the income of the section 10A unit has to be excluded before arriving at the gross total income of the assessee - The issue of reducing expenditure incurred on telecommunication, insurance and in foreign currency both from the export turnover as well as total turnover is covered by the decision of the jurisdictional High Court in the case of Tata Elexsi (2011 (8) TMI 782 - KARNATAKA HIGH COURT ). - Decided in favour of assessee. Addition of various amounts as ‘income from other sources’ - Held that:- Interest on deposits which are deposited to obtain bank guarantee issued to the customs authorities, reimbursement of expenses by the customers on account of certain bills produced by the company on their behalf and recovery from the employees leaving the company without the giving notice period are part of the business income of the assessee and have to be considered for computation of deduction u/s 10A of the Act. - Decided in favour of assessee.
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