INCOME TAX ACT, 1961

Section 92CA(4)

Transfer pricing - Reference to TPO - Power of AO to deviate from TPO's order -

Question arose for consideration was whether AO was not satisfied with the TPO's opinion on any point determined by the latter could deviate from TPO's order and proceed in his own way. Held: A conjoint reading of the earlier and existing sub-section (4) of section 92CA makes it explicitly manifest that whereas under earlier provision, report of TPO was not binding on the AO and he could compute total income of the assessee by just having regard to ALP determined by TPO. If the AO was not satisfied with the TPO's opinion on any point determined by the latter, could deviate from TPO's order and proceed in his own way. However, w.e.f. 1-6-2007 legal position has undergone change and now AO is bound by the order passed by TPO as he is required to compute total income in conformity with the ALP determined by TPO.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2009-10

INCOME TAX ACT, 1961

Section 92C

SUBSCRIBE FOR FULL CONTENT