TaxTMI 
TaxTMI 
2015 (12) TMI 1838
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....ly and disposed of in this consolidated order. Appeal wise adjudication is given in the succeeding paragraphs of this order. ITA No.8722/M/2010 (AY 2006-2007) 2. This appeal filed by the assessee on 14.12.2010 against the orders of the DRP / TPO / AO. In this appeal, assessee raised four grounds in toto. 3. Ground no.1 relates to the Transfer Pricing issue. In this ground, the issue needs to be adjudicated is whether the Profit Split Method (PSM) is the most "appropriate method' when data is not available on the CUP method as most appropriate method. A ground was also raised on the issue of correctness of 5% as the Arm's Length Price (ALP) in benchmarking the transactions with Associated Enterprise (AE). Similar issues are raised i....
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....ested on this basis (8.78% ie Rs. 2,72,38,290/- is the profit relatable to the assessee) works out to Rs. 2,10,33,668/-. During the DRP proceedings, assessee submitted that the CUP method is the most appropriate one in this kind of transactions but no data could be found for benchmarking the transactions. Therefore, assessee offered the profit of 2%, which was actually received from the AE. In this regard, assessee also submitted that the TPO failed to analyse the PSM, which he proposed to apply and finally choose to apply ad-hoc percentage of 10% as against 2% received by the assessee. On going through the submissions of the assessee, DRP observed that the TPO has not followed any standard method of TP adjustment and eventually resorted to....
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....ALP studies, TNMM is the most appropriate method for determining the ALP of international transactions in the cases of companies engaged in providing agency and marketing support services. He also mentioned that CUP method is the most appropriate, when there is no data available then the TNMM is the next best appropriate method. 6. On the other hand, Ld DR for the Revenue relied on the orders of the Revenue Authorities ie DRP / TPO / AO. 7. During the rebuttal time, Ld Counsel for the assessee filed another judgment in the case of Sumitomo Corporation India Private Limited vs. DCIT ( ITA No.5095/Del/2011) wherein, in cases of indenting services, the CUP method is approved as the most appropriate method of accounting. Further, he broug....
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....Limited vs. ACIT (ITA No.7977/Mum/2010). He also brought our attention to the Tribunal's order in the case of Sumitomo Corporation India Private Limited (supra) and submitted that this is the case where the internal CUP was approved as most appropriate, where the rate of percentage of commission of 2.26% was found to be the ALP. However, Ld Counsel for the assessee submitted that ALP in the present case may be finalised with the Bench and requested for not remanding the matter to the Revenue for one more round. 9. On the other hand, on this issue of rate of commission, Ld DR for the Revenue argued for considering 5% as an appropriate ALP as held by the Tribunal in the case of Bayer Material Science Private Limited (supra). 10. We have....
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....54 of the Act, we find the AO should act upon the application at the earliest possible. Accordingly, relevant grounds are allowed in principle. 12. Ground no.5 is general in nature and same is dismissed as such. 13. Ground no.2 relates to the addition u/s 40(a)(ia) of the Act for want of effecting TDS on the payments made, which are actually the case of reimbursement of expenses. In short, Ld Counsel for the assessee submitted that some employees of the company "Genius' were now deputed to the assessee. These employees were paid salaries after complying with the TDS provisions. These expenses were reimbursed by the assessee to Genius and TDS has not affected as they are undisputedly reimbursement of expenses. Revenue Authorities did n....
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....n this appeal, assessee raised five grounds in toto. 17. Ground no.3 relates to the TP issues, which were already referred and adjudicated while dealing with the appeal for the AY 2006-07. Since, the TP issues involved in this ground and that of the of the ones decided by us in the above paras for the AY 2006-07 are identical, therefore, our decision given therein squarely applies to the instant ground too. Considering the same, Ground no.3 raised by the assessee in the instant appeal for the AY 2007-08 is partly allowed. 18. Ground nos. 4 and 5 relate to the applicability of the TDS provisions. Identical issues were also decided by us in the above paragraphs of this order while dealing with the appeal for the AY 2006-2007. Considerin....