TaxTMI 
TaxTMI 
2021 (2) TMI 353
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....spute involved in the present appeal relates to addition of Rs. 26,33,69,103/- on account of transfer pricing adjustment. 3. Briefly, the facts are, the assessee is a resident company. As stated by the Assessing Officer, 99.99% of assessee's shares are held by TCL Overseas Holdings Pvt. Ltd., Hongkong and only one share is held by another company. The assessee is engaged in the business of trading in consumer electronic products such as television, digital video system, air conditioner, washing machines and consumer durable appliances. For carrying on such business activity, the assessee has imported completely built-in units (CBUs) with components and accessories from its associate enterprise (AE) for resale in India. Assessee had b....
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....entical, the issue may be restored back with similar directions. 5. The learned Departmental Representative agreeing with the aforesaid submission of the learned Counsel for the assessee, accepted for restoring the issue to the AO/TPO. 6. We have considered rival submissions and perused the materials on record. The main grievance of the assessee is with regard to applicability of TNMM at entity level for computing the margin. Further, the assessee has also raised objections against the comparables selected by the TPO. As we find, while deciding identical issue in assessee's own case in Assessment Year 2007-08 vide ITA No. 7129/Mum./2011, dated 15.05.2013, the Tribunal has restored the issue to the AO/TPO with the following observa....
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.... out if the loss had occurred during the normal course of business or because of some extraordinary factors which have affected the comparability of the transaction. Only in the later case the loss cases have to be excluded. No such exercise has been done. 7.1 We also find that both assessee and TPO have applied TNMM method at entity level which is not correct. The adjustment is required to be computed only with respect to international transaction and not in respect of the entire business transactions. The argument given by TPO and DRP that they have made the adjustment at the entity level because the assessee had also made entity level adjustment, cannot be accepted. Merely because the assessee had made mistakes in computing the ....
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....ut that the PL account placed at page 27 of the paper book does not show any purchase of CBUs. The learned CIT (DR) has also pointed out discrepancy in the figures of total income shown by the assessee which was 377 crore as given at page 72 of the paper book whereas the figure given at page 27 is Rs. 304 crore. Similar discrepancy has also been pointed out in case of margin of Salora International which as per the assessee was 3.30% whereas as per the TPO it was 3.08%. 7.2 Considering the various discrepancies as well as infirmities in the approach adopted by both the parties we consider it appropriate that a fresh transfer pricing study be undertaken for selecting proper comparables after careful study of functional profile of th....