Tribunal held that TPO as well as DRP have taken Nil ALP of international transaction of payment of ‘Application cost’ under CUP method however separate benchmarking of this international transaction was required. As no data for determining ALP of payment of application cost was available, nor it had been discussed by TPO, matter remitted to file of AO. As regards receipts of services the AO and TPO made addition without examining applicability of section 37(1) running in contradiction to ratio laid down in CIT v. Cushman & Wakefield (India) (P) Ltd. (2014) 367 ITR 730 (Delhi)(HC). Matter remanded to file of AO/TPO for deciding it in conformity with law laid down by High Court. (AY. 2009-10, 2010-11)
Denso India Ltd. v. Dy. CIT (2018) 167 DTR 73/ 193 TTJ 432 (Delhi)( Trib.)
S. 92C : Transfer pricing-Arm’s Length Price-Payment of application cost-TNMM method–TPO adopted CUP method and determined nil–Separate bench marking is required–Receipt for services-Addition was made without examining the provision of S.37(1)–Matter remanded.