Transfer pricing comparability under TNMM: foreign exchange loss on ECB excluded from operating cost, and a functionally dissimilar comparator removed.

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....Foreign exchange loss arising from External Commercial Borrowings and capital expenditure is treated as non-operating for TNMM PLI computation, because the loss is linked to financing and capital account items rather than ordinary business operations; the margin must therefore be recomputed after excluding that item. A comparable engaged in auto components and renewable energy was found functionally dissimilar to an assessee manufacturing hydraulic motors and motor components, so it was excluded from the comparables set. Disallowances based on additional evidence were remitted for fresh examination because the evidentiary material filed before the DRP was not properly considered, and the assessee must be given a reasonable opportunity.....