2016 (8) TMI 1049

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....(hereinafter referred to as - the Tribunal). The appeal pertains to the assessment year 2006-07 and through the same, the assessee seeks to raise the following substantial questions of law :- "1. Whether the Tribunal erred in law in remanding the issue relating to transfer pricing adjustment by holding that the TPO had not given any reasons for rejection of the CUP method which finding is perverse and contrary to the record ? 2. Whether the Tribunal erred in not allowing the adjustment of abnormal operating expenses while determining the net operating margins of the Appellant while applying the TNMM method ? 3. Whether the Tribunal erred in considering Bajaj Auto Ltd. As perfect comparable ? 4. Whether the Tribunal erred in n....

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..... No. Nature of transaction Method used by Assessee Value of transaction received Value of transaction paid       Method PLI     1. Purchase of Motorcycle, Scooter Parts, Consumables and other supplies TNMM OP/Sales   18,48,17,733 2. Export of Scooters and Scooter parts CUP/TNMM OP/Sales 140,37,12,904   3. Purchase of fixed assets TNMM OP/Sales   21,37,15,816 4. Payment of export Commission CUP/TNMM -   7,44,24,255 5. Payment of royalty CUP/TNMM -   57,26,60,430 6. Payment of technical know-how fee CUP/TNMM -   18,88,50,000 7. Payment of tech....

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....h price and both have been applied by the assessee, then reasons as to why one over the other is being preferred, are required to be supplied by the TPO in the assessment order as the choice of one method over the other could work to the assessee's prejudice. Section 92-C(1) of the Act pertains to the determination of the arm's length price in relation to "an" international transaction. Section 92-F (ii) defines arm's length price to mean a price, which is applied or proposed to be applied in "a" transaction between persons other than associated enterprises, in uncontrolled conditions. If, for determination of the arm's length price, the assessee had applied more than one of the permissible methods, as recognized under Se....

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.... the passing of the fresh assessment order by the TPO, if the appellant is still aggrieved with the findings of the Tribunal qua this question, the appellant would be at liberty to raise this issue in the proceedings, which may ensue after the passing of the afore-referred fresh assessment order. The second question also shall be deemed to have been decided in the fresh order. Question no. 3 is not pressed by learned counsel for the appellant-assessee. Question no. 4 pertains to non-allowance of the claim by the appellant with regard to depreciation on moulds and question no. 5 to non-allowance of the claim of the appellant with regard to sales tool expenses. Qua them, the Tribunal has opined that the TPO reduced the rate of depreciat....