2026 (7) TMI 120

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....the Income Tax Act [hereinafter referred as "The Act"]. 2. The following grounds have been taken in this appeal: 1. The Learned Assessment Unit has erroneously added the Transfer Pricing Adjustment (downward adjustment) amounting to Rs. 32,66,222 even though the transactions are at arm's length price only. 2. Learned AO has erred in law and on facts in not properly appreciating and considering various submissions, evidence and supporting documents placed on record during the course of the assessment proceedings and not properly appreciating various facts and law in its proper perspective. 3. The learned Assessment Unit has not given full credit of TDS claimed by the assessee at the time of filing Income Tax....

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.... 32,66,222/- and determining the total taxable income at Rs. 41,34,775/-. The assessee had filed an objection before the Dispute Resolution Panel (DRP) and the DRP had allowed partial relief to the assessee but the adjustment made by the TPO was upheld. Pursuant to the order of DRP, the AO had passed the impugned assessment order making downward adjustment of Rs. 32,66,222/- and calculating tax payable at Rs. 97,870/-. 4. Shri Sanjay Devadiya, the Ld. AR of the assessee submitted that the terms & conditions of the loans raised from the AE was approved by the Government of India and the RBI. Therefore, the TPO was not correct in holding that the interest paid by the assessee to the AE was not at arm's length price. The Ld. AR submitted th....

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....al transaction of payment of interest to AE on ECB loan considering the "other method" as the MAM and the benchmarking was done on the basis of data taken from RBI website. As per the finding given by the Ld. DRP, the assessee had come up with only two comparable out of 1106 data comparable containing issuance of apparently similar loans. The TPO, on the other hand, had used CUP as the MAM and conducted a more scientific search by using the Bloomberg database for benchmarking the interest paid on ECB loan obtained from AE. The assessee had, however, requested the TPO to benchmark the transaction by using CUP method by considering PLI as Base Rate (Libor) + Interest rate Margin; which was rejected by the TPO as an afterthought. 7. For ben....