Tax Dispute Resolved: Transfer Pricing Adjustment, Deduction Claims Validated with 3% Margin Tolerance Under Specified Sections

The ITAT addressed transfer pricing and tax deduction matters. In the TP adjustment, the tribunal remanded the case to the TPO/AO to determine arm's length pricing using TNNM method, with a 3% tolerance range for operating margin. For weighted deduction under section 35(2AB), the tribunal allowed the assessee's claim consistently with a prior year's order. Regarding additional depreciation under section 32(iia), the tribunal directed the AO to comply with DRP's instructions and allow the depreciation claim, criticizing the AO's failure to implement previous directions. The decision emphasizes procedural compliance and consistent interpretation of tax regulations. .....

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