9911796707
TMI Blog2015 (5) TMI 936X X X X Extracts X X X X X X X X Extracts X X X X ..... Our attention was not invited to any error on principle in the choice of the said companies as comparables. - Decided against assesse. - ITA No.116 of 2014 (O&M) - - - Dated:- 27-5-2015 - MR. S.J. VAZIFDAR AND MR. G.S. SANDHAWALIA, JJ. Ms. Urvashi Dhugga, Advocate for the appellant Ms. Shashi M. Kapila, Mr. Deepak Suri, Mr. Pravesh Sharma and Mr. Sanjay Kumar, Advocates for the respondent JUDGEMENT S.J. VAZIFDAR, ACTING CHIEF JUSTICE: This is an appeal against the order of the Income Tax Appellate Tribunal dated 08.08.2013 in so far as it directs the Transfer Pricing Officer (TPO) to consider Torrent Gujarat Biotech Limited and Standard Pharmaceuticals Limited as comparables for the purpose of determining the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imited, JK Pharmachem Limited, Kopran Limited and Torrent Gujarat Biotech Limited. (B) The TPO, however, rejected each of these companies in the transfer pricing study on various grounds. With respect to Torrent Gujarat Biotech Limited, the TPO held that the proportion of the main ingredient, Penicillin-G (PEN-G), as a raw material was negligible. After going through a detailed selection process, the TPO selected as comparables three companies namely, Aurobindo Pharma Ltd., Nectar Life Sciences Ltd. and Standard Pharmaceuticals Ltd. It is sufficient at this stage only to note that the usage of PEN-G by Standard Pharmaceuticals Limited in proportion to the other ingredients was only 5.23% i.e. less than the proportionate usage of PEN-G by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain other appeals by the common order which is impugned in the present appeal. The appellant/department contended that the CIT (Appeals) had wrongly rejected Aurobindo Pharma Limited as a comparable and the respondent/assessee contended that the CIT (Appeals) had wrongly rejected Torrent Gujarat Biotech Limited as a comparable. 7. The Tribunal held as appropriate comparables four companies, namely, Torrent Gujarat Biotech Limited, Aurobindo Pharma Limited, Nectar Life Sciences Limited and Standard Pharmaceuticals Limited. The Tribunal accepted the respondent s contention that where the facts are identical from year to year similar filters should be adopted for benchmarking international transactions. The Tribunal accepted the responde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view of its finding that a company ought to be considered as an appropriate comparable irrespective of its percentage of use of PEN-G to the total raw material. 9. Faced with this, Mrs. Dhugga contended that the Tribunal has erred in including Standard Pharmaceuticals Limited despite the department having conceded before the Tribunal that Standard Pharmaceuticals Limited was not an appropriate comparable in view of its relatively negligible use of PEN-G as compared to its total use of raw material or sales. We noted earlier that the TPO had himself considered Standard Pharmaceuticals Limited to be a comparable. The so called concession of the department was not binding either on the respondent or on the Tribunal. The Tribunal was called ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nancial year 2004-05 Torrent Gujarat Biotech Limited had a negative net worth. If the issue is raised before the authorities, while giving the matter appeal effect or in any other proceedings, it would be decided in accordance with law. The contentions of the parties including as to the maintainability of such a contention are kept open. 11. The issues that arise in this case do not raise a question of law much less a substantial question of law. The Tribunal s order is far from perverse or absurd. It was a possible view. It was in fact a view that the TPO himself took by selecting Standard Pharmaceuticals Limited where use of PEN-G was only 5.23% as against the 7.60% use of PEN-G by Torrent Gujarat Biotech Limited. The Tribunal s view w ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
