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TMI Blog2024 (3) TMI 1008X X X X Extracts X X X X X X X X Extracts X X X X ..... with section 144(3) of The Income-Tax Act, 1961 (The Act) dated 26th may, 2016, was partly allowed. 02. The assessee aggrieved with the same has raised following grounds of appeal:- "Based on the facts and circumstances of the case, and in law, Torrecid India Private Limited (hereinafter referred to as 'the Appellant) respectfully craves leave to prefer an appeal against the order passed by learned Assessing Officer ("ld. AO") dated 26 May 2016 / Learned Commissioner of Income-Tax (Appeals) ("Ld. CIT(A)") dated 09 May 2022 under Section 250 of the Income-tax Act, 1961 ('the Act') on the following grounds: 1. Transfer Pricing Adjustment: INR 1,66,15,022/- * On the facts and in the circumstances of the case and in law, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Nilchem Industries Ltd. and accepting Golden Chemicals Pvt Ltd. as comparable companies to the appellant * On a without prejudice basis, based on the facts and circumstances of the case and in law, the Ld. CIT(A) erred in rejecting Nilchem Industries Ltd, which was selected by the assessee in its Transfer Pricing Study report. * On a without prejudice basis, based on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in not rejecting Golden Chemicals Pvt Ltd. as it has different financial year end as compared to the appellant. The above grounds of appeal are mutually exclusive & without prejudice to each other. The appellant prays for appropriate relief based on the said grounds of appeal and the fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed Price (CUP) method as the Most appropriate method [ MAM] selecting foreign Associated Enterprises as tested party prices compared by adopting internal comparables that Associated Enterprises has sold comparable products to assessee as well as other non-AEs under similar circumstances submitting the date of sales for the year. Thus, international transactions were stated to be at arm's length. 06. The learned Assessing Officer examined the detail of sales as well as copies of the invoices raised by Associated Enterprises on assessee as well as non-Associated Enterprises. He found that transactions are geographically located differently, the description in the invoices differs and assessee did not furnish comparable prices of the material ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee at a loss of Rs.1,16,90,237/-. Over and above, the transfer pricing adjustment and certain other corporate additions were made which is not part of appeal before us. 08. The assessee vide letter dated 13th May, 2016, conveyed that it did not want to agitate before the learned Dispute Resolution Panel and therefore, the assessment order was passed on 26th May, 2016, at a loss of Rs.1,16,19,237/-. 09. The assessee preferred the appeal before the learned CIT (A), wherein the transfer pricing adjustment was contested. Before the learned CIT (A), the assessee challenged MAM rejected by the learned Transfer Pricing Officer. The learned CIT (A) rejected the argument of the assessee and confirmed the action of the learned Transfer Pricing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -. 013. By ground no.2, assessee has also challenged that CUP method selected by it should be considered as the most appropriate method and further foreign Associated Enterprises selected by the assessee as a tested party is not accepted by the learned Transfer Pricing Officer. However, both these ground are not contested before us. 014. Therefore, now the only issue remains is with respect to the inclusion and exclusion of comparables accepting the Transactional Net Margin Method and PLI of OP/Sales as the correct parameters for benchmarking. 015. The assessee has objected the inclusion of Golden Chemicals Pvt. Ltd. in the comparability analysis having PLI of 8.88% by showing the annual report of Golden Chemicals Ltd. that the reporting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in its order. Further, it is the claim of the assessee that assessee does not file any claim before the learned CIT (A) for exclusion of Nilchem Industries Ltd. We find that in the remand report proceedings, the learned Transfer Pricing Officer included the above comparable company i.e. Nilchem Industries Ltd. having the margin of 10.78%. The assessee did not object to this comparable company for its exclusion but provided the correction in the margin. The learned Transfer Pricing Officer recomputed the margin of (-) 3.23%. Thus, we find that Nilchem Industries Ltd. is a comparable not in dispute between the assessee and the learned Transfer Pricing Officer, could not have been excluded by the learned CIT (A) when none of the parties conte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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