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| The Tax Publishers2021 TaxPub(DT) 0748 (Bang-Trib) INCOME TAX ACT, 1961
Section 92C
Foreign exchange gain arising from the fluctuation of foreign exchange has to be considered as operative in nature while computing the PLI.
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Transfer pricing - Computation of ALP - Treatment of foreign exchange gain -
Revenue filed appeal against the order of CIT(A) with regard to the Forex gain earned from Software Development Services considered as operating in nature while computing PLI. Held: Relying on Fidelity Business Services India Pvt. Ltd. [IT(TP)A No. 308/Bang/2017 dt. 17-12-2020 : 2020 TaxPub(DT) 5577 (Bang-Trib)], foreign exchange gain arising from the fluctuation of foreign exchange has to be considered as operative in nature while computing the PLI. Thus, CIT(A) had taken a correct view holding that the foreign exchange gain earned having nexus with international transaction as part of operating income.
Followed:Fidelity Business Services India Pvt. Ltd. [IT(TP)A No. 308/Bang/2017 dt. 17-12-2020 : 2020 TaxPub(DT) 5577 (Bang-Trib)].
REFERRED :
FAVOUR : In favour of assessee.
A.Y. : 2010-11
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