TaxTMI 
TaxTMI 
2020 (9) TMI 324
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....Resolution Panel, Mumbai, pertaining to the assessment years 2010-11 and 2011-12. IT(TP)A no.1873/Mum./2015 ITA no.818/Mum./2016 Revenue's Appeals For A.Y. - 2010-11 &2011-12 2. The first common issue as raised in grounds no.1 to 4, in both these appeals is assailing the decision of learned DRP in accepting Comparable Uncontrolled Price (CUP) method as applied by the assessee to be the most appropriate method and thereby deleting the addition made on account of transfer pricing adjustment. 3. Brief facts are, the assessee, as stated by the Revenue authorities is a resident company offering comprehensive portfolio of international and domestic and specialized freight handling services. During the impugned assessment year, the assessee....
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....e at 22.76%. Thus, it was claimed that the transactions with the AEs are at arm's length. 4. The Transfer Pricing Officer, however, did not accept the submissions of the assessee and rejected CUP method applied by the assessee. Holding that TNMM is the most appropriate method, the Transfer Pricing Officer proceeded to benchmark the transaction with the AE by applying TNMM with operating profit (OP)/ total cost (TC) as the PLI. Out of seven comparables selected by the assessee, the Transfer Pricing Officer rejected certain comparables and ultimately proposed adjustment of Rs. 51,35,70,591, in assessment year 2010-11 and Rs. 14,53,03,285, in assessment year 2011-12. In terms with the adjustment proposed by the Transfer Pricing Officer, the A....
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....rofit sharing ratio of 50:50 is prevalent both in respect of agreement entered into between group companies with unrelated parties as well as the assessee. The same view was expressed by the Tribunal in assessment year 2005-06 vide ITA no.6004/Mum./2010, dated 25th January 2012, in assessment year 2007-08 vide ITA no. 8648/Mum./2011, dated 13th April 2012, in assessment year 2008-09 vide IT(TP)A no.7508/Mum./2012, dated 23rd July 2013 and in assessment year 2009-10 vide IT(TP)A no.1189/Mum./2014, dated 19th November 2014. There is no dispute between the parties that the facts on the basis of which the Tribunal has decided the issue in the preceding assessment years remain unchanged in the impugned assessment years as well. In fact, learned ....
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....her transactions. Accordingly, after rejecting the books of account, the Assessing Officer computed the gross profit rate and proposed additions of Rs. 10,70,21,929, in assessment year 2010-11 and Rs. 2,67,86,959 in assessment year 2011-12 on identical reasoning. The assessee challenged the aforesaid additions before learned DRP. 9. After considering the submissions of the assessee and perusing the evidences furnished, learned DRP did not find any wrong doing by the assessee and accordingly deleted the additions made by the Assessing Officer. 10. While the learned Departmental Representative has strongly relied upon the observations of the Assessing Officer, the learned Counsel for the assessee has drawn support from the observations of l....