Case Law Details
Lintas India Private Limited Vs ACIT (ITAT Mumbai)
ITAT Mumbai held that the TPO is not correct in arriving at the ALP as NIL on the ground that the need and benefit test is not satisfied by the assessee without giving any contrary findings with regard to the various documents including the TP study submitted by the assessee.
Facts- The case of the assessee was selected for scrutiny under CASS and the statutory notices were duly served on the assessee. Since the assessee had international transaction with its Associated Enterprises (AEs), a reference was made to the Transfer Pricing Officer (TPO) for determination of arm’s length price (ALP) of the international transaction.
TPO made TP adjustment of Rs.13,15,77,403/-. A draft assessment order was passed by the Assessing Officer incorporating the TP adjustments. Aggrieved, the assessee raised its objection before the DRP. DRP upheld the TP adjustment as well as the addition made by AO. AO passed the final assessment order as per the directions of the DRP against which the assessee is in appeal before the Tribunal.
Conclusion- Held that in our view the assessee has reasonably satisfied the various tests i.e. the need test, rendition test, benefit test, duplicate test and shareholder’s activity. Therefore we hold that the TPO is not correct in arriving at the ALP as NIL on the ground that the need and benefit test is not satisfied by the assessee without giving any contrary findings with regard to the various documents including the TP study submitted by the assessee. Accordingly we delete the TP adjustment made towards rendering of GIS services by the AE to the assessee.
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