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The Tax Publishers Kailash Jewels (P.) Ltd. v. ITO [ITA No. 137 (Delhi) of 2016, dt. 22-3-2016] : 2016 TaxPub(DT) 2086 (Del-Trib) TP benchmarking for a job worker Facts Assesseee a SEZ unit eligible for section 10A deduction, had during the assessment year had purchased gold with utmost fineness from its AEs from Dubai and was also found to have sold processed, converted gold into ornaments to its AE as export. Two transactions were reported as import and export with the AE. TP benchmarking was done adopting cost plus margins as cost of gold as per bill of entry + freight + labour at pre-determined rates + insurance. At the time of TP hearing the assessee used CUP method by indicating the processing charges of competitors. TPO forced TNMM and made additions. DRP upheld the addition. On further appeal - Held by the ITAT in favour of the assessee that since they were only a job worker, CUP was the Most Appropriate Method. Department assailed the earlier order of the ITAT in the assessees case, which was not found acceptable on facts by the ITAT.

The Tax Publishers

Kailash Jewels (P.) Ltd. v. ITO [ITA No. 137 (Delhi) of 2016, dt. 22-3-2016] : 2016 TaxPub(DT) 2086 (Del-Trib)

TP benchmarking for a job worker

Facts

Assesseee a SEZ unit eligible for section 10A deduction, had during the assessment year had purchased gold with utmost fineness from its AEs from Dubai and was also found to have sold processed, converted gold into ornaments to its AE as export. Two transactions were reported as import and export with the AE. TP benchmarking was done adopting cost plus margins as cost of gold as per bill of entry + freight + labour at pre-determined rates + insurance. At the time of TP hearing the assessee used CUP method by indicating the processing charges of competitors. TPO forced TNMM and made additions. DRP upheld the addition. On further appeal -

Held by the ITAT in favour of the assessee that since they were only a job worker, CUP was the Most Appropriate Method.

Department assailed the earlier order of the ITAT in the assessees case, which was not found acceptable on facts by the ITAT.