TaxTMI 
TaxTMI 
2026 (8) TMI 888
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.... Order of the ITAT gives rise to the following three Substantial Questions of Law: "A. Whether on the facts and circumstances of the case, finding of Hon'ble ITAT in para 44 is perverse in holding that the Bilcare Ltd is not functional comparable (i) ignoring the finding of TPO given on page 13 to 16 of TP order (ii) wrongly assuming that food and drink products are not perishable (iii) rejecting Bilcare on the ground that it is not using aseptic technology while none of the comparables initially selected by the assessee nor finally decided by the ITAT are using aseptic technology & ignoring that the assessee had also selected comparables which manufacturing paper products and providing packing soluti....
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....ter, working capital adjustment and selection of comparables are decided in its favor, losing the sight of the fact that the assessee is not home if the grounds raised by the Department in its appeal are decided in favor of the Department, because the same are not academic as they are very much material and the assumption of the Hon'ble ITAT that they are not material based on the statement of the assessee's counsel?" 2. At the outset, Mr. Sharma fairly stated that Question (C), as projected in the above Appeal, will not arise for our consideration in the present matter as this is not an issue in the Appeal filed by the Assessee before the ITAT, namely Appeal No. 1610/PUN/2013. This question, if at all, would arise in the Appeal ....
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....e a functional comparable to that of the Assessee for bench marking. The ITAT further noticed that the absence of segmental data for Bilcare Ltd. was also another aspect which warranted the said company being deleted from the list of comparables. The ITAT also took into consideration the differences in packaging material for various industries' products and noted that the products manufactured by the Assessee are paper based products while those of Bilcare Ltd. primarily include "wraps". Considering the facts as more particularly described at paragraph 22 (wrongly mentioned as paragraph 21) of the Impugned Order, the ITAT came to the conclusion that Bilcare Ltd. cannot be considered as a good comparable for benchmarking of the Assessee, who....
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.... the list of comparables and which was not disputed or challenged by the Respondent Assessee. We find that this argument does not carry the case of Revenue any further. Merely because segment wise details were available for the previous year does not necessarily mean that the same would apply even for the current year. There are various variables that would come into the picture if segment wise details are available. In a given case, it could even be that though the segment wise details are available the profit margins for each segment therein vary greatly from year to year. Therefore, to include an entity in the list of comparables for the current year when no segmental details are available, merely because segmental details were available....
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....e of the Revenue that the facts as recorded by the ITAT for exclusion of Karur KCP Packaging Ltd. are in any way incorrectly recorded. In fact the submissions in this regard of the Assessee, and which are reproduced in the Impugned Order at paragraph 22, clearly set out that a major quantity of paper bags sold by the said Karur KCP Packaging Ltd. were to cement industries and that the product manufactured by the Karur KCP Packaging Ltd. was totally different from the product manufactured by the Assessee. Once these are the facts, we find that the exclusion of Karur KCP Packaging Ltd. from the list of comparables, on facts, cannot be faulted. Accordingly, we find that even Question (B) as projected by the Revenue does not give rise to any su....