2018 (5) TMI 262

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....s of law, for our consideration: "(a) Whether on the facts and in the circumstance of the case and in law, the Tribunal has erred in directing the AO to compute the TP Adjustment proportionate to AE turnover, whereas the assessee has applied TNMM at entity level and therefore, adjustment would have to be computed at entity level. The law does not provide for a prorata adjustment when TNMM is applied at entity level?   (b) Whether on the facts and in the circumstance of the case and in law, the Tribunal was right by directing AO to include Diamond Tools and Gang Saw Blades segment of Rajasthan Udyog & Tools Limited as comparable segment when Rajasthan Udyog & Tools is functionally not comparable and diamond segment constitutes les....

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....n as proposed does not give rise to any substantial question of law. Thus, not entertained. 4 Re. Question (b): (i) The Transfer Pricing Officer (TPO) while arriving at the Arms Length Price (ALP), of the Respondent's transactions with its AE had excluded M/s. Rajasthan Udyog & Tools Ltd., from the list of comparables. This on the ground that it was functionally not comparable. This was accepted by the Assessing Officer in his Draft Assessment Order. (ii) Being aggrieved with the above, the Petitioner made an application to the Dispute Resolution Panel (DRP) which found that the functionally M/s. Rajasthan Udyog & Tools Ltd., was not comparable for the reason that Respondent is engaged in business of manufacturing of cutting to....

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....uestion as proposed does not give rise to any substantial question of law. Thus, not entertained. 5 Re. Question No.3: (i) The TPO excluded M/s. Hitco Tools from the list of the comparables on the ground that it was a persistent loss making unit. The same was accepted by the Assessing Officer in his Draft Assessment Order.   (ii) Being aggrieved, the Respondent filed an application to the DRP. By an order, the DRP upheld the view of the TPO. On further appeal, impugned order of the Tribunal has rendered finding of fact that M/s. Hitco Tools is not a persistent loss making unit. It was so only in the year 2005 but for the year 2006 and for the years subsequent to the year ending 31st March, 2010, M/s. Hitco Tools was making ....