TMI Blog2013 (1) TMI 886X X X X Extracts X X X X X X X X Extracts X X X X ..... posal on merits, it is pertinent to mention that there was a mistake in the amount of addition deleted by learned first appellate authority in the ground of appeal taken by the revenue. The ld. AR did not raise any objection to the amendment of the amount. 3. Briefly stated, the facts of the case are that the assessee entered into certain transactions with its Associated Entities (AEs) and independent parties. The AO made reference to the TPO under section 92CA(1) of the Act for determination of the arm's length price (ALP) with reference to the international transactions reported by the assessee in Form 3CEB. The TPO observed that the assessee is engaged in the business of manufacturing of agro chemical products including generics a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relevant material on record. The undisputed facts of the case are that the assessee applied internal CUP method for benchmarking of the transactions with its AEs. The TPO rejected the internal CUP method and preferred TNMM in its place. First of all, we will try to find out as to whether the TPO was justified in not accepting the CUP method. Various benches of the Tribunal including Asstt. CIT v. MSS India (P.) Ltd.[2009] 32 SOT 132 (Pune) and Philips Software Centre (P.) Ltd. v. Asstt. CIT[2008] 26 SOT 226 (Bang.) have preferred the following of CUP method. It is obvious that when the price of similar goods or services as sold or provided to the non-AEs is available, such a price constitutes the best guide to find out whether the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the comparison is made by the assessee with the transactions entered into in the same year with Non-AEs. It is very difficult to find out comparable transactions entered into between two different entities or for that matter one entity entering into transaction with two different entities on same date. Whereas, it is possible to check up the dates of transactions in case of internal CUP method, such verification is ruled out in external CUP method. The essence of the matter is that the comparison should be made between the transactions entered into during the same financial year. Rule 10B(4) of IT Rules 1962 provides that The data to be used in analysing the comparability of an uncontrolled transaction with an international transaction s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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