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2020 (12) TMI 1032 - AT - Income TaxTP Adjustment - payments made for intra-group services received by the Appellant - "most appropriate method" and Comparability analysis - HELD THAT:- We direct Ld. TPO to judge the requirement of services from viewpoint of assessee as a businessman. Therefore in this regard we are of view that assessee has to substantiate that these services are required by it. We note that assessee has entered into Intra Group Service agreement with AE, which is placed at page 467 of paper book Volume II. This goes to prove that services were required by assessee. We are of considered opinion that for these services, assessee has to demonstrate and satisfy Evidence Test or rendition test and benefit test, as envisaged u/s. 92(2) of the Act, and that, services provided by AE are neither duplicative nor shareholder's activity. Ld. AO/TPO is then directed to determine Arm's length price of these services based on documents submitted by assessee by determining "most appropriate method" and Comparability analysis. Protective assessment u/s. 40(a)(i) for non deduction of TDS on payment made towards managerial services - We note that Ld. TPO has made adjustment in respect of payments made towards managerial services, which has been remanded for denovo consideration based on evidences/documents filed by assessee. Assessee has deducted TDS on certain payments made to AE. It is the submission of Ld. AR that balance amount, pertains to other services. Ld. AR submits that such other payments cannot be termed as technical in nature. As we have remitted the transfer pricing adjustment on same issues to Ld. TPO for denovo consideration, this issue becomes academic at this stage.
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