TaxTMI 
TaxTMI 
2011 (10) TMI 482
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....sfer Pricing Officer (TPO) before deciding the issue in favour of assessee and grossly erred in not calling for a remand report or obtaining comments of the TPO. 2. Short facts apropos are that assessee, engaged in power generation, had international transactions with an associated enterprise called Marubeni Corporation, Tokyo (MC) which was holding 26% of the shares in the assessee. During the course of assessment proceedings, a reference was made under Section 92CA(1) of the Act to the TPO for determination of Arms Length Price with particular reference to transactions reported in Form No.3CEB filed by the assessee for the impugned assessment year. A notice under Section 92CA(2) of the Act was issued to the assessee by the TPO requirin....
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....t. Assessee also made a submission that sufficient opportunity had not been given to it to furnish all the requisite documents. However, the A.O. was not impressed. According to him, assessee did not maintain the documents statutorily required to maintain as per sub-sections (1) and (2) of Section 92D read along with Rule 10D of Income-tax Rules. He, therefore, levied penalty of 2% on the total value of international transaction of Rs. 94,05,68,268/-. 4. In its appeal before ld. CIT(Appeals), argument of the assessee was that it had maintained all required documents in support of international transactions, which were produced before TPO as well as Assessing Officer. As per the assessee, there could not have been any better evidence than....
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....essing Officer. 5. Now before us, learned D.R., strongly assailing the order of ld. CIT(Appeals), submitted that there was a gross failure on the part of the assessee in not maintaining the documents prescribed under Rule 10D. Further, according to him, just because assessee had produced certain approvals of Electricity Board of Government of Tamil Nadu and Customs authorities, it would not be sufficient to come to a conclusion that required documentation as prescribed under Rule 10D was maintained by the assessee. Further, as per the learned D.R., not recommending any change in the value of international transactions adopted by the assessee would not by itself be a sufficient ground to excuse the assessee from non-maintenance of records....
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....interest held therein by other enterprises; (b) a profile of the multinational group of which the assessee enterprise is a part along with the name, address, legal status and country of tax residence of each of the enterprises comprised in the group with whom international transactions have been entered into by the assessee, and ownership linkages among them; (c) a broad description of the business of the assessee and the industry in which the assessee operates, and of the business of the associated enterprises with whom the assessee has transacted; (d) the nature and terms (including prices) of international transactions entered into with each associated enterprise, details of property transferred or services pro....
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.... length price, including details of the comparable data and financial information used in applying the most appropriate method, and adjustments, if any, which were made to account for differences between the international transaction and the comparable uncontrolled transactions, or between the enterprises entering into such transactions; (k) the assumptions, policies and price negotiations, if any, which have critically affected the determination of the arm's length price; (l) details of the adjustments, if any, made to transfer prices to align them with arm's length prices determined under these rules and consequent adjustment made to the total income for tax purposes; (m) any other information, data or d....
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.... Record of the actual working carried out for determining ALP Assumptions, policies and price negotiations if any which have critically affected the ALP Details of adjustments if any made Detailed justification for ALP We are also furnishing certain additional information as desired by you as below : 1. We are unable to provide the published financial statements of associate enterprises, as we have not been favoured with the same. 2. Copy of the Engineering, Procurement and Construction (EPC) contract is in Annexure 7. Copy of the 8-year operational spares contract is in Annexure 8. 3. ....