2018 (5) TMI 2067

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.... to the assessment year 2009-10. 2. The first issue raised in this appeal through ground no.3 and the additional grounds is against addition of Rs. 2,51,63,689/- made by the Assessing Officer on account of transfer pricing adjustment. 3. Briefly stated, the facts of the case are that the assessee is engaged in provision of software development services, software deployment services, software consultancy services, software sub-licensing, training services and AMC activities. The assessee reported certain international transactions in Form No.3CEB. The Assessing Officer made reference to the Transfer Pricing Officer (TPO) for determining the arm's length price (ALP) of the international transactions. The TPO computed transfer pricing ad....

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.... for fresh determination of the ALP in respect of the international transaction of `Management fee', by following the orders of the Tribunal for the assessment years 2007-08 and 2008-09. As regards the international transactions of Provision of Software development services and Software consultancy services, the Tribunal treated those grounds as infructuous in view of no transfer pricing addition having been made as the same was embedded in the transfer pricing addition of 'Management fee'. 5. The ld. AR contended that the amount of transfer pricing adjustment as computed but not separately added in respect of Software development services and Software consultancy services etc. is the consequence of the first step of determination of the....

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....for which no addition was made in the final assessment order though the amount of transfer pricing adjustment was computed by the TPO. Needless to say, the assessee will be allowed a reasonable opportunity of hearing in such fresh proceedings. 6. The only other issue which survives in the instant appeal is in respect of capitalization of software licence fee. The facts apropos this ground are that the assessee debited a sum of Rs. 2,84,13,756/- on account of software licence fee. On being called upon to justify the deduction, the assessee stated that Aircom, UK granted a non-exclusive licence to it for marketing and sale of the licenced software, namely, 'ENTERPRISE suite' on the condition that Aircom, UK shall be paid 45% of the gross s....