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2011 (7) TMI 636 - ITAT MUMBAIAdjustment to arm's length price - international transaction relating to professional fee/training fee/service fee - case referred to T.P.O. - Held that:- The assessee in its TP study report had included M/s Vans Information Ltd. which is making continuous losses and more than 50% of its net worth has been wiped off, a fact brought on record by TPO and not objected to by the assessee. Further, the observation of the TPO that certain loss making companies have been included in to comparables as well as entities which are nowhere close to the assessee's business was also could not be controverted. Thus on being confronted by the TPO the assessee furnished fresh comparables according to which the mean profit comes to 34.96% as against 9.32% reported by the assessee. Even if the contention of the assessee that Hinduja TMT Ltd. which makes abnormal profit of 105.34% and whose turnover is 100.80 croresas against 6.01 crores in the case of the assessee cannot be included as a comparable is accepted still the OP/TC works out to 11.5% as found by the CIT(A) is against 9.32% disclosed by the assessee. Still he has deleted the entire adjustment made by the A.O./TPO which is not correct. As the T.P. issue was in the initial stages in this year and therefore a liberal approach should be taken. Considering the totality of the facts of the case the matter should go back to the file of the A.O. for fresh adjudication with a direction to give sufficient opportunity to the assessee to file fresh comparables of the financial year 2002-03 and make out its case properly - in favour of revenue for statistical purposes.
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