TaxTMI 
TaxTMI 
2019 (10) TMI 1555
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....d. CIT(A)"] under section 250 of the Indian Income Tax Act ("the Act") is bad in law. 2. That on the facts and circumstances of the case, the Ld. CIT(A) grossly erred in interpreting the provisions of Section 246 of the Act thereby holding the appeal as not maintainable. 3. That on the facts and circumstances of the case, the Ld. CIT(A) grossly erred in not considering the legal and factual submissions made by the Appellant in regard to the fact that the adjustment made by Ld. AO / Ld. TPO would have a futuristic impact on the income of the Appellant. 4. That the Learned Deputy Commissioner of Income Tax, Circle-2(1), Gurgaon ["Ld. AO"] / the Learned Additional Commissioner of Income Tax, Transfer Pricing Officer-l(3), New Delhi ["....
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....aw material from AE while the actual purchases from AE were insignificant and immaterial; and 5.6 disallowing the development cost on the ground that the basis of charge and mark-up was not provided by the Appellant, even though the same was never requested by the Ld. TPO during the course of proceedings u/s 92 CA of the Act. That the above grounds of appeal are independent and without prejudice to each other. That the Appellant reserves its right to add, alter, amend or withdraw any ground of appeal either before or at the time of hearing of this appeal. 3. The appellant company is a Joint Venture which was set up in India between Inergy Automotive Systems SA, Inergy Automotive Systems SAS(France), Suzuki Motor Corporation (Japa....
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.....19,800,000. Transfer pricing approach of the assessee 2. Your TP report has aggregated this transaction with other international transactions like the purchase of capital goods. You have used the Transactional Net Margin Method (TNMM) as the most appropriate method and operating profit/sales (OP/Sales) as the profit level indicator. 3. Admittedly during the year you have not commenced commercial production and hence you have not earned any revenues. Hence, to give some meaning to the MAM that you have chosen you have projected your income for the next three years (FYs ending 2011, 2012 and 2013) and arrived at OP/Sales of 14.59%. 4. The average OP/sales of the comparables has been worked out to be 3.63%. Here you have used mult....
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....t in your TP report is unsupported by facts, the entire analysis that you have made in the TP report with reference to this transaction stands rejected. 10. It is a settled matter that the primary onus to establish the arm's length nature of any international transaction lies upon the assessee. In your case, that onus has not been discharged. Effectively there is no analysis in existence that supports that arm's length nature of this transaction. It can be said without any doubt that no independent party would have made such a substantial payment under such circumstances. 11. In your submission dated 4 November 2014, you have stated that none of the international transactions that you have undertaken have any impact on your in....
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....al. The assessee strongly contended that the payment of development cost is not an international transaction. This objection of the assessee was dismissed by the TPO who was of the firm belief that explanation to section 92B2 clearly holds the impugned transaction as an international transaction. The TPO questioned the benchmarking of payment of development cost the TPO was of the opinion that the assessee failed to explain the basis of the transfer price of Rs.1.98 crores and further failed to explain the basis of 5% mark up that the AE has charged it. 7. The TPO finally concluded by holding that the assessee has not carried any benchmarking process in the international transaction related to the payment of development cost of Rs.1.98 cro....
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....nt of loss computed or the status under which he is assessed is appealable . The order which is intended to be appealed against should have anyone or more of the above mentioned consequence only then such order becomes appealable. This provisions is in-corporated because in any assessment order, there may be number of observations made by the A.O which may not be of any consequences but appellant might not agree with those observations. If such order are made appealable then a number of infructuous litigation would arise which is avoidable. The provisions of Act are very clear with the income assessed, tax demanded, loss computed or status of assessment and if none of these exists, the order is not appealable. In the present case the A.O ha....