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TMI Blog2018 (7) TMI 1847X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner of Income Tax) for A.Y.2003-04. 2. The proposed substantial questions of law framed in the Memorandum of appeal by the Appellants-Revenue are quoted below for ready reference:- "1. Whether the Tribunal on the facts and in the circumstances of the case was correct in holding that combined transaction approach is a correct method for Transfer Pricing analysis, when the trading activity and manufacturing activity are distinct and separate with different functions, assets and risk analysis and recorded a perverse finding? 2. Whether the Tribunal was correct in treating the provision for warranty costs as non-operating expenditure for the purpose of determining arm's length price after holding that, warranty forms part of operative ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cturing activities are closely inter-linked. It was also submitted that part of the trading activities were as a result of the manufacturing activities including warranty commitments. The learned counsel for the assessee also submitted that the data regarding comparable transactions were available only at entity / enterprise level and not at the individual level and that therefore the adoption of the combined transaction approach is correct. On the other hand, the learned Departmental Representative contends that functionally, assets and risks of both segments being different, therefore the combining or merging of both segments is inappropriate. The learned Departmental Representative also submitted that though the comparable companies have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uring segments, particularly when the assessee and the comparable companies are at par with regard to the nature and scale of combined activities. Needless to add that this finding / decision by its very nature has to be case-specific and year- specific as the decision is based on the facts and circumstances of this particular case and of this particular year and is not to be construed as laying down the principle in this regard. We, therefore, direct the Assessing Officer / TPO to compute the ALP at the entity / enterprise level by combining the trading and manufacturing segments". 5. This Court in ITA No.536/2015 C/w ITA No.537/2015 delivered on 25.06.2018 (Prl. Commissioner of Income Tax & Anr. Vs. M/s. Softbrands India Pvt. Ltd.,) has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Revenue do not give rise to any substantial question of law and the suggested substantial questions of law do not meet the requirements of Section 260-A of the Act and thus the appeals filed by the Revenue are found to be devoid of merit and the same are liable to be dismissed. 57. We make it clear that the same yardsticks and parameters will have to be applied, even if such appeals are filed by the Assessees, because, there may be cases where the Tribunal giving its own reasons and findings has found certain comparables to be good comparables to arrive at an 'Arm's Length Price' in the case of the assessees with which the assessees may not be satisfied and have filed such appeals before this Court. Therefore we clarify that mere dis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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