2021 (3) TMI 229

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....which nine were not pressed. Such grounds, ergo, stand dismissed as not pressed. Only ground no.9 survives which concerns with restricting the transfer pricing adjustment only to the international transactions. 3. Briefly stated, the facts of the case are that the assessee, an Indian company, is a subsidiary of Rieter Group based in Switzerland. The assessee is engaged in manufacture of textile machines and related parts and components. It provides sales and after-sales support services for the textile machinery and equipments manufactured and sold by the Rieter Group companies in India. It also carries out installation and commissioning of the machines/equipments sold by the Rieter Group companies and also provides warranty support serv....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ctions. 4. We have heard the rival submissions through Virtual Court and gone through the relevant material on record. Primarily, we want to record that the assessee has disputed neither the selection of external TNMM, nor any of the three comparables chosen. The extant dispute is for restricting the transfer pricing adjustment to the international transactions alone and not extending it to the entity level transactions. 5. Section 92 is first section of the Chapter-X containing special provisions relating to avoidance of tax. Sub-section (1) of section 92 provides that: `Any income arising from an international transaction shall be computed having regard to the arm's length price'. Thus it is graphically clear that the ALP and the co....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ncurred by it in the operating cost base. However, the TPO included the same in the operating costs of the assessee and recomputed the adjusted PLI of the assessee at (-) 6.56%. The ld. AR submitted that the assessee has no objection to the inclusion of VRS expenses in its operating cost base for the purpose of determining its PLI. It was, however, submitted that the same methodology should be applied in respect of comparable Veejay Lakshmi Engineering Works Ltd. and the VRS expenses incurred by it should also be included in the operating cost base, which the TPO did not do. 9. We have heard both the sides and gone through the relevant material on record. The ld. AR has demonstrated with reference to the relevant material on record that ....