INCOME TAX ACT, 1961

Section 92C

Transfer pricing - Determination of ALP - Payment of management service fee to AE - TPO determined nil ALP without applying any prescribed method

Assessee claimed deduction of management service fee paid to its AE abroad. TPO determined ALP thereof at nil without adopting any of the methods provided in section 92C , for the reason that assessee had failed to provide adequate documentary evidence in support of various services which were availed of by it from AE. Held: Assessee placed on record sufficient documentary evidences, viz., copy of service agreement, bifurcated details of regional management charges paid to AE, copies of invoices raised by AE towards regional management charges, etc., in order to substantiate rendition of regional management services by its domestic AE. Accordingly, it could not be said that assessee had failed to place on record any evidence in support of its claim of having received services from its domestic AE. Therefore, adjustment carried out by TPO and that too, without following any of the methods provided in section 92C was not justified.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2013-14

INCOME TAX ACT, 1961

Section 36(1)(vii)

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