2014 (5) TMI 739

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....cing adjustment in respect of the international transactions of the assessee company with its AE involving export of bathrobes. 3. The assessee in the present case is a company which is a joint venture between Indian Promoters (major being Welspun India Ltd.) and Viccnzo Zucchi S.P.A., Italy. It is engaged in the business of manufacture and export of bathrobes. The return of income for the year under consideration was filed by it on 31-10-2007 declaring total income of Rs. 1,30,65,646/-. In the said year, the assessee had exported bathrobes to its AE located in Italy for an amount of Rs. 18,55,51,843/-. In the TP study report filed by the assessee, these international transactions were bench marked by the assessee by following CUP method. ....

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....thmetic mean was more than the profit margin of 8.65% earned by the assessee, the TPO adopted the average profit margin of 15.32% of the comparables as the arm's length margin. In this regard, he rejected the contention of the assessee that the DEPB benefit from exports should also be taken into consideration as the part of sale proceeds to determine its profit margin. Accordingly, applying the average profit margin of 15.32% of the comparabled to the total cost of the assessee related to its exports to AE, the arm's length value of the exports of bathrobes of the assessee to its AE was determined by the TPO at Rs. 20,16,52,539/- as against the value of Rs. 18,55,51,843/- charged by the assessee and the difference of Rs. 1,61,00,696....

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....sp;      "17. After considering the rival submissions and perusing the relevant material on record, it is observed that the DEPB benefit was not taken into consideration by the AO/TPO for the purpose of working out the profit margin of the assessee whereas such benefit was taken into account in the comparable cases while working out their profit margin as found by the learned CIT(Appeals). Before us, nothing has been brought on record to controvert or rebut this finding recorded by the learned CIT(Appeals) and this being so, we find no justifiable reason to interfere with the decision of the learned CIT(Appeals) that the DEPB benefit received during the year under consideration should be considered as part of the tu....

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....e grounds raised in the Revenue's appeal, it is observed that the issues taken therein are arising from the order of the ld. CIT(A)-6, Mumbai dtd. 21-7-2011 whereby he disposed of the appeal filed by the assessee against the final order passed by the A.O. on 30-9-2010 u/s 143(3) of the Act as per the directions issued by the DRP u/s 144-C of the Act. 7. At the time of hearing before us, the ld. D.R. has raised a preliminary objection that the order passed by the A.O. u/s 143(3) of the Act as per the direction of the Dispute Resolution Panel was not an appealable order before the ld. CIT(A) and the ld. CIT(A) thus had no power to entertain and dispose of the appeal filed by the assessee against the said order. He has contended that the ....