https://www.taxtmi.com/caselaws?id=764583 The ITAT DELHI ruled in favor of the assessee regarding TP adjustment on deemed international transactions. The TPO had deemed revenue for a 3-month period after cessation of service agreement with an AE, rejecting the assessee's TP study and selecting 18 comparables to compute ALP at 20.92% for the entire assessment year. The ITAT held that the assessee provided software services only from April 2011 to December 2011, with subsequent operations being business shutdown activities. The TPO's comparables were prepared on going concern basis while the assessee's financial statements were not, making the comparison inappropriate. The ITAT determined that TPO cannot levy tax on notional income from non-existent international transactions, citing Excel Industries Ltd. and Ravi Kumar Sinha cases. The ALP adjustment was deleted and assessee's grounds were allowed. en-us Fri, 10 Jan 2025 00:00:00 +0530 Mon, 21 Jul 2025 11:29:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=764583 The ITAT DELHI ruled in favor of the assessee regarding TP adjustment on deemed international transactions. The TPO had deemed revenue for a 3-month period after cessation of service agreement with an AE, rejecting the assessee's TP study and selecting 18 comparables to compute ALP at 20.92% for the entire assessment year. The ITAT held that the assessee provided software services only from April 2011 to December 2011, with subsequent operations being business shutdown activities. The TPO's comparables were prepared on going concern basis while the assessee's financial statements were not, making the comparison inappropriate. The ITAT determined that TPO cannot levy tax on notional income from non-existent international transactions, citing Excel Industries Ltd. and Ravi Kumar Sinha cases. The ALP adjustment was deleted and assessee's grounds were allowed. Case-Laws Income Tax Fri, 10 Jan 2025 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=764583