TaxTMI 
TaxTMI 
2026 (9) TMI 1335
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....ated 31.10.2013 passed by the learned Income Tax Appellate Tribunal [the Tribunal] in IT [TPA] No.1510/BANG/2012 for the Assessment Year [AY] 2008-09. The respondent [Assessee] had preferred the said appeal before the Tribunal, impugning the order dated 12.10.2012 passed by the Assessing Officer [AO] under Section 143(3) of the Act. 2. The Assessee had disclosed certain transactions with its Associated Enterprise [AE]. In view of the above, the AO had made a reference to the Transfer Pricing Officer [TPO] under Section 92CA of the Act. The learned TPO passed the order dated 28.10.2011 making a transfer pricing adjustment in the sum of Rs. 128,79,01,373/- in respect of Arm's Length Price [ALP] for spare replacement services rendered b....
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....eselling them to the AE's customers in India. The learned TPO held that given the FAR [Functions, Assets and Risks] analysis, the Resale Price Method [RPM] is the most appropriate method. 8. The Asseesee disputed that its functional profile was that of a trader. It claimed that it provided product replacement services and, therefore, the international transactions should be benchmarked with other service providers, not with an entity engaged in trading activities. 9. The FAR analysis furnished by the Assessee set out that it is a captive service provider for its AE and assumes no risks. It explained that the AE had supplied equipment to the customers in India and AE undertakes the services of providing the replacement parts from its A....
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....tory, and sells the goods to customers. And, in view of its finding, the learned TPO rejected TNMM as the most appropriate method and used RPM instead. 13. The learned Tribunal examined the Assessee's functional profile and did not concur with the TPO's finding. The Tribunal accepted that the functions of the Assessee were not akin to those of a trader. The Tribunal noted that a trader purchases goods by transfer of ownership and is free to fix the resale price and choose the customers to whom the goods are sold. The Tribunal found that the Assessee has no right to fix the resale price or to select its customers to whom the products are sold. The Assessee procures the spare parts to be supplied and earns 1% mark up on the cost of imp....
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....icant difference between the three comparables adopted by the TPO and the assessee in terms of FAR? 2. Whether on the facts and in the circumstances of the case the tribunal was right in directing the AO to delete Tata Elexi Ltd. from the list of comparables if it is found that the segmental data of the comparable are not available without appreciating that the comparable satisfies all the qualitative and quantitative filters adopted by using the segmental results? 3. Whether on the facts and in the circumstances of the case the ITAT was right in holding that the assessee is covered by the amendment of the proviso to section 92C of the Act for the assessment year 2008-09 and directing the AO to give the benefit of the amen....
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....o be perverse, no question of law would arise. 19. This Court had held that the question as to whether comparables have been rightly selected or the filters for arriving at the correct list of comparables have been applied, would not give rise to any substantial questions of law. 20. The Department preferred an appeal against the judgment rendered by this Court, which is tagged along with the batch of matters, where this Court has followed the earlier decision in Softbrands (supra). 21. The Supreme Court did not accept the proposition as set out by this Court in Softbrands (supra). The Supreme Court held that the Tribunal has to follow the guidelines stipulated under Chapter X IT Act and Rules 10(a) to 10(e) of the Income Tax Rules....