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2019 (8) TMI 612 - ITAT DELHIApplicability of provisions of Section 44BBB on domestic company - assessee filed return declaring loss whereas AO applied profit of 11% of the cost and computed the profit from business - HELD THAT:- We do not find any justification to accept the contention of the Ld. D.R. Once the provisions and Section 44BBB are not applicable to domestic company as in the case of assessee, therefore, there were no justification even to place reliance upon the same provision while making the addition against the assessee. A.O. has not given any reasons as to why the losses incurred by the assessee are not allowable deduction. Further the assessee has clearly explained that the parties to the contract are not associated concerns of the assessee, therefore, provisions on International Taxation Law would not apply in the case of the assessee. A.O. has not given any finding against the assessee as to how the provisions of transfer pricing are applicable in the case of the assessee. CIT(A) has examined the issue in detail and in his findings has specifically held that the consideration received by assessee from the contract awarded could not be termed as an international transaction. A.O. did not point-out to any material to show as to how the transaction were international transaction in the matter. Since the A.O. failed to point-out that any of the party to the contract were associated concern of the assessee, there were no justification to apply such provisions of Law against the assessee. In case there would have been any international transaction between assessee and other parties to the contract, the A.O. shall have to refer the matter to TPO for getting his Opinion into the matter. But, A.O. did not do anything and framed regular assessment against the assessee. Therefore, on this sole reason itself, the Ld. CIT(A) was justified in holding that such provisions are not applicable in the case of the assessee. The Ld. D.R. failed to point-out any error in the Order of the Ld. CIT(A) in deleting the entire addition. No justification to interfere with the Order of the Ld. CIT(A) in deleting the addition. - decided in favour of assessee.
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