TMI Blog2016 (5) TMI 1098X X X X Extracts X X X X X X X X Extracts X X X X ..... y to law, and therefore, same is directed to be deleted. Since we have deleted the adjustment on primary grounds, we are not deciding other grounds - Decided in favour of assessee. Increasing the books profits for the purpose of section 115JB by the amount of transfer pricing adjustment while computing the total income of the assessee under the normal provisions of the Act - Held that:- Only those adjustments are permissible to the book profit as have been prescribed u/s 115JB. The adjustment/additions made under the transfer pricing regulations are governed by altogether different sets of provision as contained in Chapter X of the Act. There is no such provision under the law that permits the AO to make adjustment on account of transfer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eferred to as DRP ) vide its order dated 27.09.2011, on the following grounds: 1.The learned Assessing Officer ( hereinafter referred to as AO ) and the DRP have erred in proposing a transfer pricing adjustment of ₹ 1,30,72,762 /- under section 92CA(3) of the Act, in respect of the international transactions entered into by the Appellant during the year ended 31 March, 2007. 2. The learned AO and the DRP have erred in rejecting the comparable companies selected by the Appellant to benchmark its international transactions. 2.1 The learned AO and DRP have erred in computing the amount of related party transactions entered into by the comparable company namely Goa Glass Fibre Limited and accordingly erred in rejecting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... venue. 3. The solitary issue raised in this appeal is with respect to transfer pricing adjustment. 3.1. During the course of hearing, Ld. Senior Counsel of the assessee submitted, at the very outset that only issue involved in this appeal is that same comparables have been accepted in all prior and subsequent years, there is no change in facts or business of the assessee and in any case no such allegation has been made in the orders by any of the lower authorities. But, in the impugned year i.e. A.Y. 2007-08, surprisingly, the TPO did not accept these very comparables mainly on the ground that they were dealing in different products. The DRP endorsed the order of the TPO without giving any proper reasoning. He drew our attention on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and of special bench in the case of Maersk Global Centres (India) P. Ltd. ACIT 147 ITD 83 (Mumbai Trib.) 3.3. We have gone through the orders of the lower authorities as well as orders of the preceding and subsequent years as were shown to us. 3.4. The brief facts are that the assessee company is joint venture between M/s. Owens Corning, Inc. USA and M/s. Mahindra Mahindra Ltd. The assessee was engaged in manufacturing and trading of Glass Fibre reinforcement products. The impugned year (i.e., A.Y. 2007-08) is the 5th year of transfer pricing reference u/s 92CA of the Act. The brief history as noted in the TPO s order is that no adjustment was made in any of the preceding four years. With the assistance of the parties, it has also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in of the comparables was 8.71% which was less than the margin shown by the assessee at 12.63%. The TPO suggested changing the PLI as OP/TC and if the PLI is taken as OP/TC the arithmetic mean margin of the comparables was 9.96% which was less than the margin shown by the assessee at 13.70%. Thus, undisputedly, on facts, the margin of the assessee was within the permitted range of ALP. We find that adjustment made by the TPO was contrary to law, and therefore, same is directed to be deleted. Since we have deleted the adjustment on primary grounds, we are not deciding other grounds. Accordingly, ground no.1 to 5 of the main grounds may be treated as partly allowed. 4. During the course of hearing Ld. Counsel also drew our attention on the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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