2012 (3) TMI 510

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..... olution Panel ( DRP ) has erred in making an addition of ₹ 21,856,752 to the total income of the appellant on account of adjustment in the arm s length price of the international transaction entered by the appellant with its associated enterprises. 2. The TPO/AO has erred in rejecting the comparables selected by the appellant and in conducting a fresh search and selecting a new set of comparables for the determination of the ALP of the impugned international transaction. 3. The TPO/ AO has erred in (a) Rejecting the data used by the appellant which was available to it at the relevant time and proceeding to use the data which was available only at the time of TP audit and (b) Using data for a single year (fo .....

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..... difficulties in meeting comparables proposed by TPO for its Transfer price working. Based on the limited information obtained from the companies to whom notices u/s 133 of the Act were sent, assessee has not been given proper opportunity. Without evaluating all the comparability factors/ parameters as specified in the Income-tax Rules, 1962, it would not be possible to consider these companies as comparables. Thus, TPO has adopted a distorted process while making T.P. additons. 2.1. While the AO in the initial phase requested for information from the identified companies mentioned in its notice, the TPO has not gathered complete information from these companies as specified under Rule 10B(2) for ascertaining comparability analysis. Be .....

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..... to the issue of margins earned by the comparable companies, is baseless and contrary to record Ld. counsel pleads that the TP adjustment made thus need to be reversed. Alternatively, if ITAT deems it fit, then the matter may be set aside, restored back to the file of AO with directions to TPO to make the transfer pricing report afresh, after giving the assessee an opportunity of being heard about the 133(6) information in respect of comparables. 3. Ld. DR, on the other hand, supported the orders of lower authorities. 4. We have heard rival contentions and gone through the relevant material available on record. It emerges from the record that: (i) Assessee was not provided opportunity to meet out the comparability factors and .....

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