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2018 (7) TMI 1090 - AT - Income TaxDisallowance of reimbursement of expenses incurred by assessee on behalf of its AE pertaining to travel cost, marketing cost etc. - Held that:- Assessee has paid for the cost incurred and that these amounts were charged to AE as reimbursements for actual cost incurred by assessee. We do not find any infirmity in the directions issued by DRP and direct Ld.TPO to compute the adjustment if any by considering actual reimbursement received from AE and actual cost incurred by assessee in operating income/expenditure. Assessee shall file all the requisite bills raised by upon AE relating to reimbursement of the expenses, along with vouchers/bills, proving details of total expenditure incurred by assessee, on behalf of AE. Ld.TPO shall then verify the same. In the event it is found to be reimbursements on actual, no adjustments are called for. AO shall allow the claim of assessee to the extent it is reimbursements of expenditure incurred by assessee on behalf of AE. Selection of comparable - Held that:- Assessee is a wholly owned subsidiary of Inductis LLC. It provides IT enabled back-office research and data analytics services to Exl Group Companies (which includes Inductis companies as well) thus companies functionally dissimlar with that of assessee need to be deselected. Disallowance under section 14 A read with rule 8D - Held that:- Under such circumstances respectfully following the decision of Hon’ble Delhi High Court in the case of Cheminvest Ltd versus CIT (2015 (9) TMI 238 - DELHI HIGH COURT) in our considered opinion Section 14 A cannot be invoked as assessee do not have exempt income for the year under consideration and the disallowance deserves to be deleted.
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