Case Law Details
Court: Income Tax Appellate Tribunal
Citation: ACIT Vs. Vedaris Technologies (Pvt.) Ltd. [2010-TII-10-ITAT-DEL-TP]
Brief:- Overview:- The Delhi Bench of Income Tax Appellate Tribunal (“the Tribunal”) in its recent ruling in the case of ACIT v. Vedaris Technologies (Pvt.) Ltd [2010-TII-10-ITAT-DEL-TP] has held that selection of comparable uncontrolled transactions (“comparables”) for determining arm’s length price (“ALP”) should be done with reference to Rule 10C(2) of the Income-tax Rules, 1962 (“the Rules”).
The Tribunal also asserted that under the Transactional Net Margin Method (“TNMM”) appropriate adjustments should be made to account for differences between the controlled and uncontrolled transactions, which could have a material impact on the net profit margin. However, adjustments should not be ad hoc, instead should be supported by facts, documentation and back-up data.
Facts
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