TaxTMI 
TaxTMI 
TaxTMI 
2025 (8) TMI 25
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 2.1 The Ld. TPO and the Ld. DRP erred in law and on facts in disregarding the certified segmental profitability between AE and Non-AE segment which has been adopted as a part of transfer pricing documentation maintained by the assessee while determining the ALP in relating to payment for the purchase of steel coils. 2.2 Further, the ld.TPO and the ld.DRP failed to consider the submissions and evidence provided by the assessee establishing the segregation of sales made to customers and basis of allocation of expenses with respect to the materials purchased from AE and Non-AE. 2.3 The Ld.TPO and the Ld.DRP erred in law and in facts in disregarding the principle of consistency and rejecting segmentation data without considering the fact that the same has been accepted in the previous and future years. 2.4 The Ld.TPO and the Ld.DRP has erred in law and in facts in disregarding the internal TNMM method for benchmarking the international transaction in arriving at the arm's length price, which has been accepted in the previous and future years. 3. Rejection of VAE Filter and erroneous selection of additional comparable companies 3.1 The ld.TPO and the Ld.DRP disregarded....
X X X X Extracts X X X X
X X X X Extracts X X X X
....crutiny and during the course of assessment proceedings, a reference was made to Transfer Pricing Officer. The TPO vide order u/s.92CA(3) of the Act, dated 19.07.2023 proposed an upward adjustment of Rs. 5,62,73,439/-. Later the TPO has passed a rectification order and reduced the quantum of adjustment from Rs. 5,62,73,439/- to Rs. 1,97,98,470/-. Subsequently, the Assessing Officer passed draft assessment order u/s.144C of the Act on 27.09.2023 making the TP adjustment. The assessee filed objections against draft assessment order before the DRP-2, Bangalore. The DRP-2, vide their directions dated 21.06.2024 issued u/s.144C(5) of the Act, in principle upheld TP adjustment except for directing the TPO to adopt the correct margins of the comparable. Thereafter, the AO passed final assessment order u/s.143(3) r.w.s. 144C(13) of the Act for AY 2020-21 and determined total income of Rs. 9,93,58,590/-. Aggrieved by the aforementioned order, the assessee filed this appeal which is taken up for adjudication. Broadly the assessee has raised the following grounds of appeal: a. Erroneous rejection of Segmentation provided by the assessee. b. Rejection of VAE Filter and erroneous selection ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....change in the facts of the case as compared to prior years. 7. Per Contra, the Ld. DR vehemently stressed on the various points mentioned by the TPO and also submitted that despite remand proceedings the assessee was not able to furnish the necessary documentation to support its segmentation and therefore, prayed for segmentation and internal TNMM should be rejected. 8. We have heard the rival contentions perused the material available on record gone through the orders of the lower authorities along with the paper books filed and case laws relied upon. We find that on an identical set of facts for AY 2015-16, the TPO while conducting the TP assessment has in principle accepted the basis of segmentation and has not made any adjustment. In our considered view, when the TPO has accepted internal TNMM workings on the same parameters in the past years, cannot now take a different stand and try to reject the same. Our view is supported by the decision of the Apex Court in the case of Radhasaomi Satsang Vs CIT 192 ITR 321 has held that: "...where a fundamental aspect permeating through the different assessment years has been found as a fact one way or the other and parties have allowe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e Tribunal decision in the case of Brillo Technologies Pvt Ltd Vs AO, NFAC reported in Taxsutra [TS-740-ITAT-2022(Bang)-TP] held as under: "14. Now coming to the issue of application of internal TNMM and other external comparables followed by the assessee, we notice that the coordinate Bench of the Tribunal in assessee's own case for the AYs 2011-12 & 2012-13 in ITA Nos. 518/Bang/2016 & 354/Bang/2016 by order dated 19.1.2018 has upheld the internal TNMM used by the assessee for determination of the ALP for international transactions. The relevant extract of this decision is as follows:- "7. Having carefully examined the orders of lower authorities and the documents placed before us, we find that the assessee has placed the relevant evidence with respect to scope of work, nature of services rendered for AE and non AE in the same countries. But these aspects were not examined by the TPO. Therefore, we set aside the order of the AO passed consequent to the order of the DRP and restore the issue to the AO/TPO to reexamine the issue of determination of ALP for international transactions in the light of the transactions made with non-AEs in the same countries. It is settled position....