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2015 (1) TMI 94 - ITAT DELHITransfer pricing adjustments - Determination of arm's length price - Held that:- It is well settled legal position that the ALP adjustments can only be made in respect of international transactions with the AEs and cannot extend to the transactions with non AEs. There are large number decisions of the coordinate benches, including in the case of Alstom Projects India Ltd Vs ACIT [2013 (8) TMI 442 - ITAT MUMBAI], holding so. In the case of CIT Vs Stratex Networks India Pvt Ltd (2013 (5) TMI 277 - DELHI HIGH COURT), Hon’ble jurisdictional High Court has also accepted this position. Learned Departmental Representative, even as vehemently relying upon the stand of the TPO, does not dispute this legal position but he contends that the factual elements embedded in this contention, at least on computation aspect, need to be verified by the TPO. That is only arithmetical part giving effect to this principle. We see no harm in this exercise. - it fit and proper to uphold the stand of the CIT(A) in principle but remit the matter for the limited purposes of verifying the computation of excluding transactions with non- AEs in calculating the ALP required to be made under the TNMM method. To this extent, the matter is restored to the file of the TPO. - Decided in favour of Revenue.
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