TaxTMI 
TaxTMI 
2020 (4) TMI 909
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....lution Panel (DRP). 2. The grounds numbered as 1 to 7 are general in nature. The grounds numbered as 8 to 13 are related to Transfer Pricing Adjustment. Ground No.14 relates to the disallowance made u/s 40(a)(ia) of the Act. 3. The assessee herein is a subsidiary of M/s Kennametal Inc., USA. As mentioned in the order of TPO, it is engaged in the business of manufacture of sintered products, dies & wear parts, round tools, carrier bodies, end mills, conforma clad and machine tools. The products manufactured by the assessee are supplied to various industries such as construction, mining, general engineering and machine tools. The assessee is having two segments, viz., Manufacturing Segment and Trading Segment. The TPO has made transf....
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....stems Ltd. 21.26% 17.54% 2 Hottco Tools Ltd. 5.19% 4.93% 3 I T L Industries Ltd. 10.65% 9.63% 4 Jainex Aamcol Ltd. 9.80% 8.92% 5 Kulkarni Power Tools Ltd. 6.06% 5.71% 6 Micromatic Manufacturing Systems Pvt. Ltd. 6.57% 6.16% 7 Mitsubishi Heavy Inds. India Precision Tools Ltd. 21.65% 17.80% 8 Solitaire Machine Tools Ltd. 14.62% 12.75% 9 Rane Brake Lining Ltd. 3.70% 3.57% 10 Federal-Mogul Anand Bearings India Ltd. 6.03% 5.68% 11 Birla Precision Technologies Ltd 7.17% 6.69% 12 Bharat Fritz Werner Ltd. 2.80% 2.72% Average 9.62% 8.51% Accordingly, the TPO made transfer pricing adjustment o....
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....tion of this filter by the TPO has been found acceptable and hence objections of the assessee are rejected." While the objection of the assessee was with regard to the threshold limit, we notice that the Ld DRP has given its decision of adoption of RPT filter, which is not the objection of the assessee. 10. With regard to the plea of the assessee for inclusion of four comparable companies, the Ld DRP has observed as under:- "7.5 On perusal of the order of the TPO, it is found that above 4 comparables qualified all filters adopted by the TPO and are functionally comparable. Panel finds that objections and submissions of assessee made before TPO have been considered and countered by the TPO correctly. Therefore assessee's objec....
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....l observations, i.e., without addressing specific grounds urged in respect of each of the companies. We have noticed that the assessee, in its Transfer Pricing study, has made adjustment towards under utilization of capacity. However, the said adjustment was not given by the TPO. Hence, we are of the view that the Ld DRP was not justified in declining to adjudicate this claim of the assessee. As noticed earlier, the Ld DRP has not adjudicated the issue relating to selection of PLI. 14. In totality, we are of the view that the Ld DRP has passed a nonspeaking order. In this view of the matter, we are of the opinion that all the issues relating to Transfer pricing adjustment need to be restored to the file of Ld DRP/AO for adjudicating all ....