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2018 (7) TMI 1878 - AT - Income TaxTPA - Comparable selection - functinal similarity - Held that:- Assessee has rendered Software Development Services to its AE thus companies functionally dissimilar with that of assessee need to be deselected from final list. Adherence to filters such as export earnings less than 25%, employee cost less than 25%, RPT more than 25%, Onsite revenue more than 60%. Some companies also lacks comparability based on scale of operations. Disallowing the claim of deduction u/s 10A - Disallowance of expenditure - allocation of expenditure between 10A units and non 10A unit - Held that:- disallowance has been made on an adhoc basis without pointing out any particular item of expenditure which is relatable to the non PSE division. It is also emerging from the record that the action of the Assessing Officer is based on similar addition made in assessment year 2008- 09. Before us, nothing has been brought out to show the finality of the addition made in preceding assessment year 2008-09. However, additions made on mere conjectures and surmises are unsustainable. Be that as it may, considering the entirety of circumstances, we deem it fit and proper to restore the matter back to the file of Assessing Officer, who shall reconsider the aforesaid addition afresh as per law
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