9911796707
TMI Blog2012 (11) TMI 554X X X X Extracts X X X X X X X X Extracts X X X X ..... ricing adjustment after necessary examination and after allowing opportunity of hearing to the assessee - In the result, appeal of the assessee is allowed for statistical purposes. - ITA No. 8885 (Mum.) of 2010 - - - Dated:- 3-8-2012 - Shri D. Manmohan, And Shri Rajendra Singh, JJ. M.P. Lohia for the Appellant. Ajeet Kumar Jain for the Respondent. ORDER Rajendra Singh, Accountant Member This appeal by the assessee is directed against the order of AO dated 30.9.2010 passed in pursuance of direction under section 144C issued by The Dispute Resolution Panel-II. The assessee in this appeal has raised several grounds which relate to the transfer pricing adjustment made by AO as per direction of DRP, principle of na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and other car products, had entered into several international transactions which included import of base oil of Rs.10,40,94,103/- and import of additives for Rs.5,40,03,872/- from associate enterprises. Since the assessee had made transactions with associate enterprises, the AO had referred the issue of computation of arms-length-price to the Transfer Pricing Officer (TPO) under section 92CA. The assessee had conducted a transfer pricing study and selected six comparables which had yielded average operating margin of 3.56% against margin of 7.54% declared by the assessee on the transactions with associate enterprises. Therefore, as per the assessee, no adjustment was required to be made. The TPO, however, conducted his own study of prowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... water oil Co. (India) Ltd. 304.74 295.02 9.72 3.19 3.29 8. Universal Petrochemicals Ltd. 61.56 59.47 2.09 3.40 3.51 9. Balmer Lawrie Co. Ltd. 5.34 10. Gulf Oil Corporation Ltd. 3.78 11. Valvoline Cummins 1.33 Average 4.22 3.2 The AO computed the transfer pricing adjustment with respect to gross sales of Rs.119.04 crores. The AO computed the operating profit based on the profit margin of 4.22 % at Rs.5.02 crores against the operating profit of Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e regarding computation of adjustment of Rs.81.00 lacs required verification at the level of AO/TPO. The ld. AR stated that he had no objection to any such verification. 5. We have perused the records and considered rival contentions carefully. The limited dispute raised is regarding transfer pricing adjustment in relation to international transactions entered into by the assessee with associate enterprises. There is no dispute either regarding TNMM method followed by the AO or about variables selected for computation of transfer pricing adjustment. The only dispute raised by the assessee is whether the transfer pricing adjustment should be computed with respect to gross turnover of the assessee or should be limited to volume of transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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