Appeal Dismissed: No Substantial Question of Law Found; Tribunal's Prior ALP Methodology Stands Unchallenged.

The HC concluded that the appellant/revenue's appeals were closed due to the absence of a substantial question of law. The appellant failed to challenge the Tribunal's prior order, which endorsed the TNMM and Berry ratio for determining the ALP of international transactions. The issues in the current appeals mirrored those from previous years, negating the need for further consideration.

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Issues Involved:
1. Delay in filing/re-filing the appeals.
2. Determination of the Arm's Length Price (ALP) for international transactions using the Transaction Net Margin Method (TNMM) and Berry ratio method.
3. Impact of the Bilateral Advance Pricing Agreement (BAPA).

Summary:

1. Delay in Filing/Re-filing the Appeals:
The appellant/revenue sought condonation of delay in re-filing the appeals, but there was a lack of clarity as to whether they were seeking condonation for filing or re-filing. Despite the COVID-19 disruption, the appeals were delayed significantly. The applications for condonation of delay in re-filing were filed much later than their dated affidavits. The court noted the considerable delay and ambiguity surrounding the appellant's request.

2. Determination of ALP for International Transactions:
The controversy centered on the commission earned by the respondent/assessee from international transactions with its Associated Enterprises (AEs), referred to as indenting transactions. The Tribunal had previously determined that the TNMM was the most suitable method for determining ALP and that the Berry ratio method was appropriate for calculating the Profit Level Indicator (PLI). The Tribunal's detailed analysis highlighted significant differences in volume, products, and geographical locations between AE and non-AE transactions, making the Comparable Uncontrolled Price (CUP) method unsuitable. The Tribunal remanded the matter to the Transfer Pricing Officer (TPO) to benchmark the international transactions using TNMM and Berry ratio as PLI.

3. Impact of the Bilateral Advance Pricing Agreement (BAPA):
The respondent/assessee argued that a BAPA executed with the Central Board of Direct Taxes (CBDT) governed the parties. The court noted that the BAPA was executed on 02.08.2016, and this agreement impacted the assessment.

Conclusion:
The court concluded that the appellant/revenue did not appeal against the Tribunal's order dated 22.10.2018, which had established TNMM and Berry ratio as appropriate methods for determining ALP. The Tribunal's subsequent order on 21.05.2019 followed the same principles. Given the lack of a substantial question and the appellant's failure to challenge the earlier order, the appeals were closed. The court emphasized that the issues in the current appeals were similar to those in previous assessment years, thus no new substantial question arose for consideration.

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