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TMI Blog2012 (6) TMI 237X X X X Extracts X X X X X X X X Extracts X X X X ..... ng his powers u/s 133(6) -remand these two issues to the file of the AO to re-consider the same as per the guidelines issued - in favour of assessee by way of remand. Adjustment sought by the appellant towards receivable, marketing and credit risk borne by the comparables - assessee has claimed the risk adjustment which is not allowed by the TPO on the ground that the assessee also has the risk of having a single customer – Held that:- the assessee had acquired the business earning income out of the said transaction by cost plus basis, thus, it can be seen that the assessee has not encountered the risk of having a single customer, whereas the same cannot be said as regards the comparables - the comparables were dealing in open market and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rounds of appeal; "1. The order passed by the ld. AO based on the directions issued by the DRP is bad in law. 2. The ld. AO relied on the directions issued by the DRP. The DRP has upheld the order of the TPO. 3. The order of the TPO suffers from errors and is unjustified on account of the following; a. The TPO erred in making an order u/s 92CA and directing adjustments towards shortfall to arm's length price to the extent of Rs. 62,55,873/- b. The TPO erred in rejecting the documentation maintained by the appellant and conducting a fresh search of the comparables. c. The TPO erred in obtaining the information and documents not available in public domain by exercising his power u/s 133(6) of the IT Act, 1961 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation maintained by the assessee and conducting the search of the comparables and also obtaining the information and documentation not available in public domain by exercising his powers u/s 133 of the IT Act, 1961. We find that the sub-ground (a) is general in nature and needs no adjudication. Sub-ground- (b) is rejected as not pressed by the learned counsel for the assessee. As regards sub-ground-(c) (d) are concerned, we find that these issues are covered by the decision of the co-ordinate Bench of this Tribunal (to which one of us i.e. JM is a signatory) in the case of Genisys Integrating Systems (India) (P.) Ltd. v. Dy. CIT [2012] 20 taxmann.com 715 wherein this Tribunal has directed the AO to adopt the filter of turnover and als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... compared to the comparables adopted by the TPO. He drew our attention to the transfer pricing analysis adopted by the assessee and the risk adjustment claimed by the assessee at 5.5% as compared to its comparables. He submitted that the comparables adopted by the assessee and also TPO are prone to various risks such as market risk, technical risk etc., and these risks are taken into consideration, the net margin of these companies would come down substantially which would be on par with the ALP adopted by the assessee. Thus, according to him, the TPO ought to have allowed the risk adjustment before making comparison of the net margin of the assessee and comparables. 6. The learned DR however, opposed the contention of the assessee and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'single customer risk' meaning, if the single customer refuses to have any dealings with the assessee, the assessee would lose all of its business and there would be no profit at all. But, as we see it, the risk of having a single customer is anticipated risk which may or may not happen. What we have to see is the position in the relevant period whether the assessee had encountered such a risk during the relevant period. 7.1 As seen from the records, the assessee had acquired the business and also earned income out of the said transaction by cost plus basis. Thus, it can be seen that the assessee has not encountered the risk of having a single customer, whereas the same cannot be said as regards the comparables. As pointed out by the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .com 100. Respectfully following the same, we direct the AO to exclude the amount of Rs. 1,05,858/- from the export turnover as well as the total turnover for the purpose of computing the deduction u/s 10A of the IT Act. 10. As regards the additional ground of appeal, we find that this issue is also covered by the decision of this Tribunal in the case of Genisys Integrating Systems (India) (P.) Ltd., ( supra ) and also in the case of Tatra Vectra Motors Ltd. v. Dy. CIT [2012] 20 taxmann.com 131 (Bang.) to which one of us is a signatory. Respectfully following the same, we direct the AO to give plus or minus 5% variation for the purpose of computing the ALP. This ground of appeal is partly allowed for statistical purposes. 11. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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