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| The Tax Publishers2019 TaxPub(DT) 8101 (Del-Trib) INCOME TAX ACT, 1961
Section 92C
Where assessee demonstrated need for services along with evidence produced for availment of such services, and also established benefit derived from said services, then said services were neither deliberative in nature nor were shareholder activities, therefore, availment of intra-group services being inter linked with other international transaction, should be benchmarked on aggregate basis by adopting the Transactional Net Margin Method as most appropriate method.
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Transfer pricing - Computation of ALP - Intra-group services received from AEs - Services whether to be benchmarked on aggregate basis by adopting TNMM
Assessee received intra-group services from its AEs and it were allocated amongst group companies. While benchmarking international transaction with AEs, margin of assessee was worked out to 25.54% as against mean margins of comparables selected by assessee, at 14.79%. TPO alleged that assessee failed to establish its case of receipt of economic and commercial benefits from such payment. Held: Assessee demonstrated need for services and also produced evidence of availment of such services and also established benefit derived from said services. Those services were neither deliberative in nature nor were shareholder activities, therefore said availment of intra-group services being inter linked with other international transaction, should be benchmarked on aggregate basis by adopting the Transactional Net Margin Method as most appropriate method. Upward additions made by TPO were deleted.
REFERRED :
FAVOUR : In assessee's favour
A.Y. : 2010-11
INCOME TAX ACT, 1961
Section 92C
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