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2019 (4) TMI 1305 - AT - Income TaxTP Adjustment - transactions related to contract revenue from projects - selection of MAM - as contended that the Ld. TPO & Ld. DRP erred in adopting the CPM (Most appropriate method) despite the fact that under the identical facts, this Tribunal in earlier years had approved TNMM as most appropriate method - HELD THAT:- We find that the method adopted by the TPO was also held to be correct method. The grievance of adopting this method of the assessee firstly is that it has been done with project to project basis not on the average of all projects. As per the assessee, project to project would not give a true picture as each project has its own life cycle. Secondly, it is stated that set off of surplus revenue/profit exceeding the arms length price and from the other projects has not been given while computing the ALP under a transaction by transaction analysis. We find merit into this contention of the assessee that Ld. TPO erred in comparing individual project margins of transaction with A.E. with aggregate margins earned from transactions with non A.E., which is improper as individual margins are being compared with aggregate margins that is impermissible under law, therefore, the impugned order is set aside. The A.O. is therefore directed to re-compute adjustment after comparing the margins of individual transactions with A.E. with individual transactions margins with non A.E. Comparing the individual transactions with A.E. with aggregate transactions with non A.E. would give a distorted picture of margins, hence, ground Nos.1 & 2 of the assessee’s appeal are partly allowed as indicated herein above.
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