2020 (9) TMI 68

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....has erred in interpreting the 1st proviso of section 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 providin....

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....SEZ unit). 7. During the Assessment proceedings, the AO referred the 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 c....

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....elied on the order of the AO, while the ld. counsel for the assessee relied on the order of the CIT(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 th....

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....een held that the word "derived by an undertaking of the business" in Section 10A and 10B are far wider to include 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 p....

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....y transfer pricing adjustment in the case of assessee for AY 2013- 14 came up for consideration before CIT(A) and it was held as follows:- "...... It is seen that appellant 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....