INCOME TAX ACT, 1961

Section 92C

Transfer pricing - Computation of ALP - TNMM vis-à-vis CUP method -

Assessee-company reported certain international transactions in Form No. 3CEB. One of the reported international transactions was 'Payment of fees for Advisory and other services' and the assessee applied TNMM as the most appropriate method for demonstrating the said transaction to be at ALP. TPO did not accept the assessee's point of view on the ground that the assessee did not lead any evidence to demonstrate that the services were actually received. He, therefore, rejected the TNMM and applied the CUP method for such international transaction. Accordingly, he determined Nil ALP of the said international transaction and made TP adjustment. Held: In assessee's own case for earlier assessment years on identical issue, the application of TNMM as the most appropriate method had been accepted in preference to the CUP method as applied by TPO and after giving certain directions, the matter was remanded to the AO/TPO for deciding the issue accordingly. Since the facts and circumstances of the instant issue were mutatis mutandis similar to those of earlier years. In view of the same, the instant issue was remanded to the AO/TPO for deciding the same afresh in accordance with the directions given by Tribunal in the assessee's own case for the earlier assessment years.

REFERRED :

FAVOUR : Matter remanded

A.Y. : 2016-17

INCOME TAX ACT, 1961

Section 254(1)

SUBSCRIBE FOR FULL CONTENT