ITAT: Non operating income and expenses to be excluded from computing ‘net profit margin’ under TNMM

Non operating income and expenses to be excluded while computing ‘net profit margin’ under TNMM; Use of multiple year data rejected; TPO directed to consider working capital adjustment and grant standard deduction

Jul 14, 2011

ITAT: Invoking of section 92 (pre 2002) not justified

Invoking of section 92 (pre 2002) not justified

Jul 14, 2011

ITAT: Benefit of 5% variation from ALP allowed based on Circular No. 12 of 2001

Benefit of 5% variation from ALP allowed based on Circular No. 12 of 2001

Jul 14, 2011

ITAT: Internal CUP not suitable where uncontrolled transactions are undertaken with unrelated foreign entities

RPM to be applied only where Indian entity has purchased goods/services from foreign AE; internal CUP unsuitable for uncontrolled transactions with foreign unrelated entities

Jul 14, 2011

SC: Dismisses SLP, directs assessee to pursue DRP mechanism

Assessee to resort to Alternate Dispute Resolution Mechanism introduced in Budget 2009 i.e. DRP mechanism; Competent Authority should not reject assessee’s proposal because it has come after cut-off date

Jul 14, 2011

ITAT: Benefit of 5% variation available only when ALP is computed using different methods

Benefit of 5% variation from arithmetical mean not available when only one ALP used; Risk adjustment not allowable in absence of details of risk borne by assessee; Interest free advances

Jul 14, 2011

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