Performance Guarantee as Indemnity: No Arm's Length Adjustment Needed; Assessee Justified in No Fee Charge for AE Contract.

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Full Text of the Document

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....Adjustment arising out of performance guarantee - The transaction is in the form of indemnity provided by the assessee - the contract which was awarded to its AE would get assigned in assessee’s favor wherein the assessee would be obligated to execute the contract on its own by using its own infrastructure, which would in turn, result in assessee deriving the entire contractual revenue and huge profits therefrom. There would be no need to make any adjustment on Arm’s Length principles. - assessee was justified in not charging any fees against the same - AT....