2026 (7) TMI 1956

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... AO, for short) u/s. 143(3) r.w.s 144C(13) read with section 144B of the Income Tax Act, 1961 with the direction of Dispute Resolution Panel-1 dated 26.11.2025 u/s. 144C(5) of the Income Tax Act, 1961 for AY: 2022-23. 3. Heard and perused the records. Assessee, Molvizadah Sons India Private Limited ( in short 'MZS India' or "Appellant') was incorporated in India on September 13, 2017, as a wholly owned subsidiary of Molvizadah Sons Pte. Ltd. ('MZS Pte.?'). The Appellant is engaged in trading of Spices, Oil Seeds, Seeds, Dry Fruits and Confectionery ingredients to its AEs and third-party customers. 3.1 During the period under consideration, the Appellant sold spices and dry fruits to its Associated Enterprises (AEs&....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... Pursuant to the directions of DRP, the Ld. TPO passed an order giving effect dated 8 December 2025 wherein the proposed adjustment was reduced to IN 28,588,330. While passing this effect order, Ld. TPO, allowed the working capital adjustment as directed by the DRP. However, as regards the 2nd relief, Ld. TO summarily rejected the inclusion of the two selected comparables stating that "no reliable and complete financial data of DL Tanumal Pvt. Ltd. and Premier Pulses Ltd. is available in the public domain to enable application of the prescribed filters or to determine their functional comparability as mandated under Rule 10B. In absence of availability of financials and requisite segmental information, these companies fail the basic test of....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... with respect to filing of audited segments results is not correct." 5. Then ld. Counsel has then pointed out certain arithmetical mistakes made by ld. TPO is calculating segmental margins as Ld. TPO has inadvertently considered the sum of non-operating expenses attributable to the Non-AE export segment as INR 2,354,415 instead of INR 134,068 and thus submitted that even where the revised segment level profitability as computed by Ld. TPO is considered, after rectification of mistakes apparent from record, it shall support the Appellant's argument that it has earned better margins from its AE segment when compared with its Non-AE segment. Details of the revised segment level profitability (as computed by Ld. TPO), the mistakes appare....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....find from the same that the revised segment level profitability, as computed by Ld.TPO, after rectification of mistakes apparent from record, supports the argument that the margins earned by the Appellant from its AE segment i.e., (1.37)% is in excess of the margins earned by the Appellant from Non-AE segments i.e., (1.79)%. 7. Then, otherwise too where the computation of Ld. TO is considered, the subject transaction still meets the arm's length principle as per section 92C of the Act in light of the {+/- 1%} tolerance limit. We find that this contention has been affirmed by the co-ordinate bench in the case of the Appellant in the immediately preceding assessment year i.e., AY 2021-22, (supra) and the relevant extracts of the order ....