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| The Tax Publishers2020 TaxPub(DT) 3566 (Del-Trib) INCOME TAX ACT, 1961
Section 92C
Where TPO/DRP have made adjustment on substantive basis in assessment year 2010-11, since the proceedings in assessment year 2010-11 were sub judice, protective adjustment was made in assessment order making an addition which is in line with similar addition for assessment years 2011-12, 2012-13 and 2014-15 and MAP resolution was passed which was much after the order passed, by AO/TPO/DRP, therefore, matter was remanded back to AO/TPO for deciding the issue afresh.
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Transfer pricing - Computation of arm's length price - Protective adjustment on account of business restructuring -
Assessee was engaged in business of providing telecom services under ILD, ISP and Voice Mail/Audiotex Services license and earns service revenues from provision of such services. Since assessee had entered into certain international transactions, AO referred the matter to TPO for determination of ALP of international transactions. The TPO during the TP assessment proceedings noted that the assessee has entered into international transactions. TPO noted that BTGC India acquired a license to act as an international telecom carrier operating in India. Assessee carries international telecom traffic in and out of India. BTGC India provides Multiprotocol Label Switching ('MPLSâ€) and other telecom connectivity services. For providing network connectivity services to its customers, BTGC India also avails network connectivity services from its AE's. Rejecting the various explanations given by the assessee, TPO proposed an upward adjustment to total income of assessee. AO accordingly, in the draft assessment order, added the same to the total income of the assessee Held: TPO/DRP have made adjustment on substantive basis in assessment year 2010-11. However, since proceedings in assessment year 2010-11 were sub judice, protective adjustment was made in assessment order making an addition which is in line with similar addition for assessment years 2011-12, 2012-13 and 2014-15. MAP resolution was passed, which was much after the order passed by AO/TPO/DRP. Under these circumstances, it was deemed fit to restore the issue to AO/TPO for deciding the issue afresh in the light of the MAP resolution and the order passed by DRP in assessee's own case for assessment year 2014-15 and AO/TPO shall decide the issue as per fact and law after giving due opportunity of being heard to the assessee.
REFERRED :
FAVOUR : Matter remanded
A.Y. : 2013-14
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