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DATE: October 13, 2014 (Date of pronouncement)
DATE: October 18, 2014 (Date of publication)
AY: 2008-09
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CITATION:
CUP cannot be applied on hypothetical or imaginary value but a real value on which similar transactions have taken place is required. TPO has no jurisdiction to question commercial expediency of transaction

(i) One of the very basic pre condition for use of CUP method is availability of the price of the same product and service in uncontrolled conditions. It is on this basis that ALP of the product or service can …

AWB India Pvt Ltd vs. DCIT (ITAT Delhi) Read More »

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DATE: October 14, 2014 (Date of pronouncement)
DATE: October 15, 2014 (Date of publication)
AY: 2005-06 & 2006-07
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CITATION:
Expenditure by way of royalty for use of technology cannot be disallowed on the ground of being capital in nature or for non-business purpose

The arrangement between the assessee and the Australian company has been duly signed by both the parties. The rate per piece has also been specified therein. The royalty has been paid in actual. MACNAUGHT is not a related concern of …

Groz Engineering Tools Pvt. Ltd vs. DCIT (ITAT Delhi) Read More »

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DATE: October 13, 2014 (Date of pronouncement)
DATE: October 14, 2014 (Date of publication)
AY: 2005-06
FILE: Click here to view full post with file download link
CITATION:
Advertisement expenditure incurred by agent to popularize the business of the channel run by the foreign principal is allowable as there is a direct business between the expenditure and the assessee's business as agent. The fact that the foreign principals also benefited does not entail right to deny deduction under section 37(1)

The main grounds on which the revenue has questioned the order of the tribunal are (a) non disclosure in form 3CEB of the fact that the principal is also a beneficiary of the advertising expenses; (b) that the advertising and …

CIT vs. N.G.C. Network (India) P. Ltd (Bombay High Court) Read More »

Posted on by editor
COURT:
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COUNSEL:
DATE: October 13, 2014 (Date of pronouncement)
DATE: October 14, 2014 (Date of publication)
AY: 2009-10
FILE: Click here to view full post with file download link
CITATION:
TPO cannot question commercial expediency of payment to AE. RBI approval to a transaction implies it is at arms' length price

We are of the opinion that the TPO was incorrect in going into the business expediency of payment of royalty and arriving at the conclusion of the quantum of the royalty. We find support for this proposition in the decision …

DCIT vs. Owens Corning Industries (India) Pvt. Ltd (ITAT Hyderabad) Read More »