Wave Inc., a corporation incorporated in Country T, specializes in the manufacturing of computer hardware components and also owns the online social…

Wave Inc., a corporation incorporated in Country T, specializes in the manufacturing of computer hardware components and also owns the online social networking platform Attire. Smile Ltd., an Indian entity, generally imports computer hardware parts from Wave Inc. However, during the previous year 2024-25, Smile Ltd. did not procure any computer hardware parts from Wave Inc. Instead, on 24th July 2024, it made a payment of 5,50,000 to Wave Inc. for advertising its business on the Attire platform. However, Smile Ltd. neither deducted tax at source nor equalisation levy on such payment. On 9th November 2024, Wave Inc. sold 3,500 equity shares it held in XYZ Ltd., an Indian company, for a price of 102 per share. These shares were originally acquired by Wave Inc. on 15th April 2011 at a cost of 36.40 per share. The purchase and sale of these shares were carried out through a recognized stock exchange in India, and Securities Transaction Tax (STT) was duly paid on both the purchase and sale transactions. The Fair Market Value (FMV) of these shares on 31st January 2018 was assessed at 90 per share. CII for F.Y.2011-12 – 182; F.Y.2024-25 – 363. Smile Ltd. has received a draft order from the Assessing Officer under Section 144C of the Income-tax Act, 1961, following adjustments made by the Transfer Pricing Officer to the arm's length price for the Assessment Year 2024-25. However, Smile Ltd. does not prefer to file the objection against the draft order before the Dispute Resolution Panel; Instead, it wants to file an appeal before the CIT (Appeals) under section 246A against the final order received from the Assessing Officer. From the information given above, choose the most appropriate answer from MCQ 10 to MCQ 12 below: