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2018 (6) TMI 468 - AT - Income TaxTPA - selection of comparable for determining the ALP - import of finished formulations from its AE - these formulations are in the nature of super speciality and temperature sensitive products for treating infertility, bed wetting etc.. - providing product developmental services on contract basis for its AE - extraordinary event. Comparable Celestial Labs Ltd. - Held that:- impact of the expenses incurred in connection with IPO as well interest income earned on escrow account wherein proceeds of IPO were kept shall be excluded while computing PLI of the said company for benchmarking international transactions of the assessee with its AE, as it is clearly visible that this extra-ordinary event of IPO happened in the relevant period under consideration before us. Thus, there is a need to further analyse the financial statements of Celestial Labs Limited. Comparable Tonira Pharma Ltd. - Held that:- The setting up of ETP/Waste disposal plants are in line with State Policy and this is not a valid reason for discarding comparable. However, perusal of the Audited Financial Statements for the year ended 31-03-2008 which is placed in file reveals that the said company has two units namely Ankleshwar unit and Nandesari unit. The Ankleshwar unit of Tonira Pharma Limited was hit by an extra-ordinary event of attachment of its inventory by the Excise and Custom Departments The Excise and Custom Department disallowed the clearances of finished goods from the said company’s Tonira Pharma’s Ankleshwar Plant due to litigation with Excise and Custom Department. - matter need to be restored to the file of the AO/TPO for fresh adjudication of this issue of selection of Tonira Pharma Limited as comparable for computing ALP of the international transactions entered into by the assessee with its AE of product development activity is concerned.
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