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Tax Publishers Asstt. CIT v. EYGBS India (P) Ltd. [ITA No. 2984/Bang/2018, dt. 31-8-2020] : 2020 TaxPub(DT) 3413 (Bang-Trib.) Addition under section 92C(4) -- Claim of deduction under section 10AA post APA -- Advance Pricing Agreement *Facts:* Assessee in their TP return had offered income voluntarily to align with the Arm's length price (ALP) subsequent to which they entered into an APA with the CBDT by which their ALP stood further increased/revised. Consequentially in the revised return to be filed as per law they made further additions as per the APA and then claimed section 10AA benefit on the same. The assessing officer disallowed the deduction under section 10AA alleging that the assessee had purposefully offered additions only in anticipation of TP adjustments and that the additions made deeming under TP provisions cannot be extended to the definition of income under section 2(24) thus ineligible for section 10AA benefit. On appeal the deduction of section 10AA was allowed by the Commissioner (Appeals). Aggrieved it was the department who went in higher appeal - Held against the department/in favour of the assessee that they were eligible for the deduction under section 10AA consequential to the APA. *Editorial Note:* The plea of the department is what makes this case interesting especially the counter saying that it was in anticipation of addition under TP provision that voluntary offering was made to ALP and then section 10AA deduction was claimed by the assessee besides the fact that an addition under TP cannot fall under section 2(24) thus ineligible for section 10AA benefit. It was subsequent to this vide APA the voluntary offering to ALP stood enhanced as well. Reference be made to decisions of IBM India (P) Ltd. v. Asstt. CIT [IT(TP)A No. 725/Bang/2018, dt. 31-7-2020] : 2020 TaxPub(DT) 3023 (Bang.-Trib.) and in Dell International Services India Private Limited v DCIT [IT(TP)A No. 879/Bang/2018, dt. 24-6-2020] : 2020 TaxPub(DT) 2644 (Bang-Trib)

Tax Publishers

Asstt. CIT v. EYGBS India (P) Ltd. [ITA No. 2984/Bang/2018, dt. 31-8-2020] : 2020 TaxPub(DT) 3413 (Bang-Trib.)

Addition under section 92C(4) -- Claim of deduction under section 10AA post APA -- Advance Pricing Agreement

Facts:

Assessee in their TP return had offered income voluntarily to align with the Arm's length price (ALP) subsequent to which they entered into an APA with the CBDT by which their ALP stood further increased/revised. Consequentially in the revised return to be filed as per law they made further additions as per the APA and then claimed section 10AA benefit on the same. The assessing officer disallowed the deduction under section 10AA alleging that the assessee had purposefully offered additions only in anticipation of TP adjustments and that the additions made deeming under TP provisions cannot be extended to the definition of income under section 2(24) thus ineligible for section 10AA benefit. On appeal the deduction of section 10AA was allowed by the Commissioner (Appeals). Aggrieved it was the department who went in higher appeal -

Held against the department/in favour of the assessee that they were eligible for the deduction under section 10AA consequential to the APA.

Editorial Note: The plea of the department is what makes this case interesting especially the counter saying that it was in anticipation of addition under TP provision that voluntary offering was made to ALP and then section 10AA deduction was claimed by the assessee besides the fact that an addition under TP cannot fall under section 2(24) thus ineligible for section 10AA benefit. It was subsequent to this vide APA the voluntary offering to ALP stood enhanced as well.

Reference be made to decisions of IBM India (P) Ltd. v. Asstt. CIT [IT(TP)A No. 725/Bang/2018, dt. 31-7-2020] : 2020 TaxPub(DT) 3023 (Bang.-Trib.) and in Dell International Services India Private Limited v DCIT [IT(TP)A No. 879/Bang/2018, dt. 24-6-2020] : 2020 TaxPub(DT) 2644 (Bang-Trib)