2016 (8) TMI 1510 - HC - Income Tax

TP Adjustment - Selection of MAM - Tribunal directing AO to restrict the adjustments only in relation to the transactions with the Associate Enterprise and not on the entire revenue of manufacturing segment - assessee has selected Transactional Net Margin Method and applied the same at entity level - whether if the overall margins are less than the arms length margin, the short fall must be on account of the Associate Enterprise transactions and not on pro-rata basis? - HELD THAT - The impugned order of the Tribunal decided the issue framed herein in favour of the respondent assessee by following its decision in CIT v. Thyssen Krupp Industries India (P.) Ltd. 2015 (12) TMI 1076 - BOMBAY HIGH COURT and in the case of CIT v. Tara Jewels Exports (P.) Ltd. 2015 (12) TMI 1130 - BOMBAY HIGH COURT . No distinguishing features in this case to the above two cases relied upon by the impugned order has been shown to us. Question as framed does not give rise to any substantial question of law.

Summary

Issues:
Challenge to the order of the Income Tax Appellate Tribunal regarding the Assessment Year 2008-09.

Analysis:
The appeal under Section 260A of the Income-tax Act, 1961 challenges the Tribunal's order dated 28th August, 2013. The substantial question of law raised by the Revenue pertains to the direction given by the Tribunal to restrict adjustments only in relation to transactions with the Associate Enterprise, rather than on the entire revenue of the manufacturing segment. The crux of the issue lies in the application of the Transactional Net Margin Method at the entity level and the determination of shortfalls in margins concerning Associate Enterprise transactions. The appellant Revenue concedes that the Tribunal's decision aligns with previous judgments in similar cases, namely CIT v. Thyssen Krupp Industries India (P.) Ltd. and CIT v. Tara Jewels Exports (P.) Ltd. The Revenue's appeals against these judgments were dismissed by the Court, establishing a precedent. As no distinguishing features have been presented to differentiate this case from the aforementioned precedents, the appeal is deemed to meet the same fate as the previous cases.

The learned Counsel for the appellant Revenue acknowledges the consistency in the Tribunal's decisions with past judgments, resulting in the dismissal of the Revenue's appeals against them. Given the lack of unique features in the present case to warrant a different outcome, the framed question does not give rise to any substantial question of law. Consequently, the Court concludes that the appeal is not entertained and is dismissed without any order as to costs.