Standards which are normally applicable to deductibility of expenditure cannot be applicable to enterprises governed by transfer pricing provisions, rules ITAT

Last updated: 12 June 2021
Quick Summary
The Income Tax Appellate Tribunal (ITAT) has ruled that standard rules for deducting expenditure do not apply to companies operating under transfer pricing regulations. This decision stems from an appeal concerning management fees paid by Spicer India Pvt. Ltd. The Assessing Officer (AO) disallowed a significant portion of these fees, deeming them shareholder services with no real benefit. However, the Commissioner of Income Tax (Appeals) deleted this adjustment, a decision upheld by the ITAT, which found reliance on previous tribunal rulings in the assessee's own case.

Court :
ITAT Pune

Brief :
This appeal by the Revenue against the order dated 06-03-2020 passed by the Commissioner of Income Tax (Appeals)-6, Pune [„CIT(A)‟] for assessment year 2015-16.

Citation :
ITA No.580/PUN/2020

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