TaxTMI 
TaxTMI 
2020 (9) TMI 68
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.... 92C(4) of the Income Tax Act by unnecessarily inserting the wards 'Voluntary' before the 'enhancement of income' after the computation of income uls 92C(4). CIT(A) has erred in not realizing that the 1st proviso of section 92C(4) is triggered when the income computation for deduction u/s 10AA is enhanced only in the computation of income and no such entries are made in the books of account." 3. The assessee is a wholly owned subsidiary of EYGI B.V., Netherlands, engaged in the business of providing back office support services in the nature of Information Technology Enabled Services (ITES) to its Associated Enterprises ("AEs"). 4. The transaction of providing ITES to AE was an international transaction and the price rec....
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....he matter to the Transfer Pricing Officer [TPO] for determination of ALP of international transactions entered into by the assessee. In compliance with APA terms, the Assessee had filed the annual compliance report with the TPO on 14.06.2016, pursuant to which the TPO vide order dated 25.04.2017 accepted the international transaction entered by the Assessee, as at arm's length. 8. The assessee claimed deduction u/s. 10AA of the Act in respect of the voluntary TP adjustment made in the revised return of income in respect of TP adjustment voluntarily made of the SEZ Unit at Gurgaon which unit was eligible for deduction u/s. 10AA of the Act. The AO denied the revised claim of deduction u/s. 10AA. 9. The AO gave the following reasons for ....
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....Appeals). 13. We have considered the rival submissions. The first aspect which we notice is that according to the computation mechanism provided under the APA agreement, the assessee worked out the ALP adjustment of Rs. 11,47,09.000/- (Rs. 2.80.29.000 pertaining to the STPI unit and Rs. 8,66.80,000 pertaining to the Gurgaon SEZ unit), which has been offered to tax in Modified Return filed in accordance with APA terms. The ALP adjustment made by the assessee pursuant to APA is a Voluntary Transfer Pricing adjustment and is therefore eligible for deduction under section 10AA of the Act, as section 10AA(1) read with 10AA(7) of the Act uses the expression Profits and gains derived from the export of the unit which is wide in nature and covers ....
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....nclude ancillary income as well within its ambit:- * Hewlett Packard Global Soft Ltd. [2018] 403 ITR 453 (Karnataka) (FB); * Motorola India Electronics (P.) Ltd. [2014] 265 CTR 94 (Karnataka) * Riviera Home Furnishing [2016] 65 taxmann.com 287 (Delhi) * Maral Overseas Limited [2012] 136 ITD 177 (Indore - Trib.) (SB) * Hrithik Exports (P.) Ltd. [IT Appeal No. 219 of 2014, dated 13.11.2014 * Mercer Consulting (India) (P.) Ltd. [2014] 150 ITD 1'(Delhi Trib.) 16. We therefor hold that income offered to tax pursuant to voluntary Transfer Pricing adjustment should be regarded as profits of business for the purpose of computing deduction u/s. 10AA of the Act. 17. The next aspect which requires consideration is as to, whether ALP ....
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....nt as well as the AO have accepted in principle that the issue has been dealt with by the Jurisdictional High Court in the case of l-gate Global Solutions Pvt Ltd in order dated 17.6.2014 in ITA 453/2008 holding that the benefit of section 10AA is to be allowed in respect of Voluntary Transfer Pricing adjustment. following the order of Jurisdictional High Court in the case (supra). in the case of appellant also. the appellant is entitled to benefit under section 10AA in respect of Voluntary Transfer Pricing adjustment which stand on different footing as compared to the Transfer Pricing adjustment made by the TPO. It is held accordingly." 20. The aforesaid order of the CIT(Appeals) for AY 2013-14 on the said issue has been accepted by the d....