INCOME TAX ACT, 1961

Section 92C

Transfer pricing - Determination of ALP - Payment made to overseas AE towards technical, administrative and training support services - Assessee did not furnish detailed documentation maintained by it in proof of services received from AE

Assessee claimed deduction of payment made to its overseas AE towards technical, administrative and training support services. TPO determined ALP thereof at nil on the ground that assessee did not furnish detailed documentation maintained by it in proof of services received from AE, except providing service agreement copy and few copies of emails. Held: TPO specifically called upon assessee to give details of services rendered and how the same were utilized by assessee and its relevance for the assessee's business. The evidence filed by the assessee in this regard was in the form of e-mails between parties, reports, etc. As to how evidence filed by assessee was actually useful in its business had also to be highlighted as assessee would be the best person to know these facts which were within its knowledge. Filing of voluminous correspondence, reports, etc., would not be a proper way of discharge of assessee's burden to establish the ALP of expenditure in question. Therefore, assessee was directed to comply with queries raised by TPO in his show cause notice.

REFERRED :

FAVOUR : Matter remanded.

A.Y. : 2013-14

INCOME TAX ACT, 1961

Section 14A Section 44

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