2018 (12) TMI 986

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.... 3. Ground Nos. 2 to 6, with all its sub grounds, relates to the addition of Rs. 6.63 crores made on account of transfer pricing to the income of the appellant by holding that its international transaction relating to reimbursement of expense to its Associated Enterprise [AE] does not satisfy the Arm's Length Price. 4. Briefly stated, the facts of the case are that the appellant company was incorporated on 24.04.2007 as an indirectly wholly owned subsidiary of Wal-Mart Stores Inc, USA. The company provides various types of consultancy services and assistance to entities in India in connection with development, operation and management of wholesale business, retail business and related operations. 5. While going through the transfer....

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....in the contention of the ld. counsel for the assessee. The Tribunal in ITA No. 1090/DEL/2014 for assessment year 2009-10 had the occasion to consider an identical issue and restored the matter to the file of the TPO by observing as under: "Our above findings are based upon the submission of the Ld. AR to which we are prima facie convinced specially in view of a settled position of law that how an assessee conducts his business is entirely his prerogative and it is not for the Revenue authorities to decide what is necessary for an assessee and what is not and that when evaluating the arm's length price of a service, it is wholly irrelevant as to whether the assessee benefits from it or not, the real question which is to be determini....

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....carefully pursuing submission in this case, no upward adjustment is proposed to the income of the assessee in relation to the international transaction which was the subject matter of 6 benchmarking. Hence, the upward adjustment of Rs. 13.07.20.653/- made in the original order for the expat support services u/s 92(A(3) is thus reduced to NIL. AO is requested to take the necessary action." 11. In the light of the findings of the co-ordinate bench and that of the TPO, we are of the considered opinion that the transfer pricing adjustment of Rs. 6.63 crores deserves to be deleted. We direct accordingly. Ground Nos. 2 to 6 with all its sub-grounds are allowed. 12. Ground No. 8 relates to adhoc disallowance of 10% of the total staff welfare....