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TMI Blog2012 (12) TMI 1042X X X X Extracts X X X X X X X X Extracts X X X X ..... or doing the work similar to which it did for which it received freight revenue from its AEs. The crux of the matter is that in both the situations, the total receipts are taken on one hand, from which all the expenses incurred in connection with the transportation of cargo in both the countries are excluded. The remaining amount is distributed between the entity of origin country and the entity of destination country in equal share. As the assessee has earned/paid revenue from/to its AEs in the same proportion, in our considered opinion, the transactions have been recorded at arm’s length price and there was no justification for making such addition. We do not see any reason to interfere with the impugned order. - ITA No. 4427/Mum/201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad. The execution of this job involves lifting of cargo from the place of customers in India, sending it to the Indian port/airport, shipping or airlifting as the case may be to the country of its destination, collecting it from such port/airport of the other country and then supplying it to the ultimate buyer. In so far as the activities in India are concerned, these are done by the assessee and the activities abroad are executed by certain foreign entities, with whom the assessee has entered into contracts for this purpose. In the like manner, such foreign entities also undertake shipping/airlifting of cargo from their respective countries. The activities in India, similar to which are performed by such foreign entities in their coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y contractor. Various submissions were advanced in support of allocation of profit in the ratio of 50:50. The TPO was not convinced with the 50:50 sharing of the revenues. He rejected the assessee s contention and proposed the adjustment of ₹ 19.82 crores by applying the TNMM. 4. It was argued before the ld. CIT(A) that both origin company and destination company owned comparable assets for providing similar functions and bearing comparable risk. It was further argued that the sharing of profit in equal ratio was perfectly justified because of the similarity in the functional profits of both the AEs. The ld. CIT(A) got convinced with the assessee s submission and deleted the addition. The Revenue has come up in appeal against such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the expenses incurred in connection with the transportation of cargo in both the countries are excluded. The remaining amount is distributed between the entity of origin country and the entity of destination country in equal share. As the assessee has earned/paid revenue from/to its AEs in the same proportion, in our considered opinion, the transactions have been recorded at arm s length price and there was no justification for making such addition. We do not see any reason to interfere with the impugned order. 7. The ld. Counsel for the assessee has placed on record copies of the orders passed by the Tribunal in the case of ACIT vs. M/s Agility Logistics Pvt. Ltd. for assessment years 2004-05 to 2006-07. In these two separate orders, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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