2011 (1) TMI 1214

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....The total demand created was Rs. 2,72,65,238 which included interest of Rs. 61,70,149 under section 234B of the Income-tax Act. The assessee paid a total sum of Rs. 98,76,636 against the above demand and the balance outstanding is Rs. 1,73,88,602 which includes interest of Rs. 61,70,149. The Learned AR for the assessee argued that while making TP adjustments the assessee had applied Resale Price Method (RPM) to determine the arm's length price and on this basis no adjustment was required. The TPO however though he held that RPM was the most appropriate method observed that the assessee had used expected gross profit margin while computing its gross margin which was nothing but a notional figure. He therefore adopted Transactional net margin....

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....e assessee had not filed the financial accounts of the comparable cases as was clear from letter dated 20-10-2010 of the Addl.Commissioner (TP) written to the Assessing Officer a copy of which has been placed on record. As regards the research and development expenses, it was submitted that the Assessing Officer in para 3.6 of the order had given a clear finding that the nature of the business of the assessee was processing and marketing of vegetable seeds and the assessee was neither producing nor developing any kind of seeds and therefore expenditure did not relate to the business of the assessee. It was accordingly urged that the stay petition of the assessee should be rejected. 3. We have perused the records and considered the rival co....