TaxTMI 
TaxTMI 
2026 (3) TMI 122
X X X X Extracts X X X X
X X X X Extracts X X X X
....ant Assessment Year ('AY') at Rs. 9,19,20,120/- as against income of Rs. 4,76,82,060/- returned by the Appellant. 2. That the Transfer Pricing Officer ("ТРО") and Dispute Resolution Panel ("DRP") erred in making an addition of Rs. 4,16,31,884/- to the income of the Appellant by computing the arm's length price ("ALP") of interest on non- convertible debentures ("NCDs") @ 12.13% as opposed to interest @ 12.51% - 13.20% paid by the Appellant. 3. That the DRP erred in not rendering findings on the alternate economic analysis submitted by the Appellant both before the TPO and DRP and instead remanding the matter for determination by the AO/TPO in violation of the mandate of Section 144C(8) of the Income tax Act, 1961 (the "Act") 4. That the TPO erred in alleging that the alternate economic analysis (internal CUP and external CUP) made by the Appellant was not submitted in the original proceedings before the TPO. 5. That TPO erred in making bald averments that the NCDs issued by the Appellant to its AEs were issued in completely different economic environment, different market conditions and on different agreements, witho....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nge of diversified and innovative products backed by superior customer experience. The Company provides easily accessible loans for products ranging from Mobile Phones, Laptops, Home Appliances, Electronics and Two Wheelers. 5. During the year under consideration, the assessee company has entered into the following international transactions:- Table-A International transaction Amount (INR) Method Used for Determining the Arm's Length Price Software development cost Homer 221,374142 TNMM License fee 4150945 Other Method Software development cost-SAP software 28226515 TNMM IT maintenance fee(Homer & SAP software) 146007608 TNMM Legal and Professional fees 80059305 TNMM IT support services for Homer software 8413186 TNMM Interest paid on Non-Convertible Debentures 2552354840 CUP Corporate Guarantee 15637398 Other Method Issue of share capital 9509999980 Other Method Software and IT services 163827779 Other Method IT maintenance fee of other software 92215367 Other method Reimbursement of expenses 30816428 Other method Reimbursement of SBLC charges 65005195 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 6937500 3. PPFC03BV Bonds 2250000000 12.51 365 281475000 272925000 8550000 4 PPFC03BV Bonds 4000000000 13.20 159 230005479 211361095 18644384 48569384 9. The ld TPO proposed an adjustment of Rs. 4,85,69,384/- on account of excess interest paid to NCDs, to its AEs. Out of these 4 comparables, the ld DRP deleted the ALP adjustment made in respect of PPFC03BV Bonds of Rs.1,87,50,00,000/-. Hence, in the final assessment order, the ld TPO's TP adjustment got sustained only for Sl Nos. 1, 3 and 4 of the aforesaid Table C. As per the filter applied by the ld TPO to consider only those comparable company where NCDs were issued during the FY 2017-18, the following NCDs would be completely outside the ambit of TP adjustment: - Sr. No. Name of the AE Face value of NCDs Coupon rate percentage 1. AB4BV Bonds 1875000000 12.90 2. PPFC03BV Bonds 2250000000 12.51 10. These two would be outside the ambit of TP adjustment and we order accordingly. Now what is left to be adjudicated is whether NCDs issued to AE PPFC03BV Bonds for R....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... case for AY 2020-21, vide order passed u/s 92CA(3) of the Act dated 28.07.2023. The said order is enclosed in pages 1170 to 1218 of the paper book-II. In fact, the ld DRP for AY 2018-19 in para 4.1 had specifically directed the ld TPO to consider the alternative approach adopted by the assessee by giving the fresh benchmarking analysis using Internal CUP to be examined on merits and pass a speaking order thereon. This direction was not even complied with by the ld TPO by stating that assessee had not given any benchmarking analysis using Internal CUP. This statement is factually incorrect as assessee had indeed filed the benchmarking analysis using Internal CUP vide letter dated 29.07.2021, which is enclosed in page 392 of the paper book-1. Hence, in the interest of justice and fairplay, we direct the ld TPO to benchmark the PPFC03BV Bond instrument issued by assessee for Rs.4,00,00,00,000 with coupon rate of 13.20 % by using Internal CUP as the MAM. As stated supra, there cannot be any TP adjustment in respect of AB4BV Bonds for Rs. 1,87,50,00,000/- with coupon rate of 12.90 % and PPFC03BV Bond for Rs.2,25,00,00,000/- with coupon rate of 12.5% as they had not passed the filters a....