TaxTMI 
TaxTMI 
2021 (6) TMI 547
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....Act. 2. The assessee has raised the following grounds :- "Grounds Relating to Transfer Pricing-Legal Issues 1. The learned Income Tax Officer, ward-7(1)(4), Bengaluru (hereinafter referred as "AO" for brevity), learned Additional Commissioner of Income Tax, (Transfer Pricing) 2(2), Bengaluru (hereinafter referred as "TPO" for brevity), and the Honourable Dispute Resolution Panel-2(hereinafter referred as "DRP" for brevity) ("AO", "TPO" and DRP collectively referred as "lower authorities" for brevity) have erred in passing the order which are bad in law 2. The learned AO has erred in passing the final assessment order without appreciating that he does not have jurisdiction over the Appellant. The Order passed without jurisdiction is ba....
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....ilters in the process of selecting comparables; b. Adopting a profit level indicator of Operating profit/ Operating cost without appreciating that the operating cost consists purchases from AE; c. Considering foreign exchange gain or loss as non-operating in nature; d. Adopting companies as comparables even though they are not comparable in respect of functions performed, risks assumed, assets utilized, size, turnover, unusual business circumstances, high margins, etc., e. Rejecting K Dhandapani and Co Ltd as a comparable on unjustified ground; f. Inappropriately computing the TP adjustment. 7. The lower tax authorities have erred in a. Not providing adjustments for transactional and entity wide differences between the Appella....
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.... independent and without prejudice to one another. The Appellant craves leave to add, alter, vary, omit, substitute or amend the above grounds of appeal, at any time before or at, the time of hearing, of the appeal, so as to enable the Income-tax Appellate Tribunal to decide the appeal according to law. The Appellant prays accordingly." 3. Ground Nos. 1 to 9 which are related to TP issues are not pressed before us on the reason that these issues are settled under MAP proceedings. Accordingly, these grounds are dismissed as not pressed. 4. With reference to ground No. 10(a), the facts are that the assessee claimed Rs. 5,71,804 as preliminary expenditure incurred towards ROC fees for authorised share capital. This was considered as capi....
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....tion. 7. The assessee was incorporated on 30.8.2010 and obtained PAN on 30.8.2010. The first board meeting of company was held on 30.8.2010. First GM was appointed on 1.9.2010. Equity capital was introduced on 15.9.2010. First Purchase Order was placed on YEC, Japan on 6.10.2010. Rent receipt from Regus Centre Services (Bangalore) Pvt. Ltd. for renting of office space at S 306, South Block, Manipal Centre, Dickenson Road, Bangalore was received on 10.10.2010. Key Management Personnel were appointed on 2.11.2010. Import/Export Certificate was obtained on 23.11.2010. Import invoice receive from YEC, Japan for import of goods in accordance with the first Purchase Order on YEC was received on 07.12.2010. The assessee pleaded before the AO th....
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....her, he relied on the judgment of the Hon'ble Delhi High Court in the case of Carefour WC & C India (P.) Ltd., 53 taxmann.com 289 (Del) wherein it was held as follows:- "The present assessee was engaged and incorporated for carrying on trading activities in different commodities. The word 'trade' even though not defined in the Act is used to denote operations of a commercial character by which a trader provides to customer for reward, some kind of goods or services. In other words, when the trader starts providing such goods and services, the business is said to have commenced but the same may not hold good for set up of a business, which is a stage before the commencement. To set up a business, the following activities become....
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....n. These are pre-conditions to start business which are not obtained by the assessee, as such the AO disallowed the expenditure since the assessee has not set up the business. 11. We have heard both the parties and perused the material on record. In this case, the reason for not allowing expenses is that the assessee has not set up business and business was set up only from the date of obtaining VAT registration. As seen from the facts of the case, the assessee was incorporated under the Companies Act on 30.8.2010 and made all arrangements to start the business from the date of introducing the capital on 15.9.2010 and took the premises for operation of its business from 10.10.2010. Key management personnel were also appointed on 2.11.2010....