2011 (3) TMI 565

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....sed in the light of the directions of by the Disputes Resolution Panel (DRP), issued under section 144C(5) and sub-section (8) and based on the order of the Transfer Pricing Officer dated 30-10-2009, passed under section 92CA of the Income-tax Act, 1961. 2. The first issue raised by the assessee in the appeal is against the Arms Length Price addition of Rs. 46,35,034 made by the assessing authority in the light of the order of the Transfer Pricing Officer while computing the income from foreign transactions with related parties. 3. The case of the assessee is that the Members of DRP failed to understand that the Transfer Pricing Officer did not appreciate any of the services rendered by the assessee company. The assessee company did n....

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....Rs. 46,35,034 has been added by way of adjustment under section 92CA. 5. On examination of the case, we find that there is no verifiable basis for determining the profit factor at 10 per cent of the cost as embodied in the agreement entered by the assessee and its associate concern. The argument of the assessee that the services rendered by the assessee are only basic services to its holding company and therefore the prices declared by the assessee are to be treated as reasonable, as the Arms Length Price cannot be accepted as an overwhelming proposition for the reason that the assessee has not placed before us any cost model and market potential of the products so as to accept or reject the bench mark profit of 10 per cent. It is the ca....