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TMI Blog2018 (7) TMI 579X X X X Extracts X X X X X X X X Extracts X X X X ..... n 40(a)(ia) of the Act. In view of this, we do not find any merit in the argument of the Ld. AR and uphold the order of the lower authorities. Thus, this ground of appeal of the assessee is dismissed. - I.T.(TP)A. No.447/Coch/2016 - - - Dated:- 5-7-2018 - SHRI CHANDRA POOJARI , AM AND GEORGE GEORGE K., JM For The Assessee : Shri R. Srinivasan, CA For The Revenue: Shri A. Dhanaraj, Sr. DR ORDER Per CHANDRA POOJARI, ACCOUNTANT MEMBER: This appeal filed by the assessee is directed against the assessment order passed u/s. 143(3) r.w.s. 92CA(3) of the I.T. Act dated 27/01/2016, consequent to the direction of the DRP u/s. 144C(5) of the Act dated 25/08/2016. The relevant assessment year is 2012-13. 2. The assessee has raised the following grounds of appeal: 1. The Dispute Resolution Panel, Bangalore is not justified in rejecting the claim of the appellant for the Glazing Loss in the commodity exported. 2. The Dispute Resolution Panel, Bangalore did not properly appreciated the fact that your appellant company is mainly exporting the products ranging to 25% glaze, whereas the rate quoted by MPEDA is only 10-20% glaze. 3. The Dispute Resolut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reject the arbitrary weightage claimed and to compute Arm's Length Price accordingly. The relevant portion of the showcause notice is reproduced below:- As per the Transfer Pricing (TP) document furnished for the A. Y. 2012-13, the taxpayer company has sold products to Associated Enterprises (AEsJ of ₹ 79,50,26,341/-. While going through the Transfer Pricing study submitted by you for A. Y 2012-13, it is seen that you have adopted Comparable Uncontrolled Price Method as the most appropriate method while benchmarking the international transactions undertaken with Associated Enterprises. You have compared your AE sale price with the rates published by The Marine Products Export Development weekly data released by MPEDA based on the type of the product is seen taken as the benchmark for arriving at arm's length price. However, you have claimed adjustments @3% to the sale price in each sale made to AE so as to bring it within the Arm's length price. However this is not in accordance with the transfer pricing provisions. You have claimed uniform adjustments @ 3% in all cases, without providing any clear rationale for the same. Adjustments have been claime ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on their export price to AE was rejected and ALP was determined accordingly. 4. On examination of the claims of the assessee, the PRIME rate sheets and other documents produced by the assessee and the order of the TPO, the DRP observed that the assessee could not controvert the findings of the TPO with evidence that it is exporting to its AE Cuttlefish of various glazes ranging from 15% to 25%. It was also observed that the assessee could not controvert the findings of the TPO that any loss that the assessee suffers by way of comparison of their 25% glaze product (with price of 20% glazed product published by MPEDA) will be duly compensated by the comparison of their 15% glaze produce (with price of 20% glazed product published by MPEDA). The DRP observed that the assessee could not give reasons why many of the invoices do not mention any details of the glaze of the product. Also, it was observed that the assessee had not produced any basis as to how the differences in glaze leads to a uniform 3% adjustment on all invoices. Further, the assessee could not give evidence as to higher glazing necessarily means lower price. According to the DRP, TPO had made adjustments as per each ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch meant that the price of Squid products with 10%, 15% and 20% glaze need to be adjusted in order to have a fair comparison with a squid product listed in MPEDA data without any glaze. It was submitted that the squid products on an average should be priced much lesser due to the glazes as compared to the squid price listed in MPEDA which do not show any glaze. To sum up, it was submitted that cuttlefish and squid products exported have this reduction in price due to glaze varying between 5% to 20%. Hence, according to the Ld. AR, it was only reasonable to claim an average reduction in prices, that too at a very nominal percentage of 3% in order to compensate for the glaze difference in the assessee s products and those listed in MPEDA data. 6. On the other hand, the Ld. DR relied on the orders of the lower authorities. 7. We have heard the rival submissions and perused the record. The TPO made adjustment after examining the invoice produced by the assessee that it has exported products having glazes ranging from 15% to 25%. The product of the assessee is having various glazes ranging from 15% to 25%, as such, the assessee s product could be compared with the price list publi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to EIA, will be given credit in their passbook by the respective regional EIA office, immediately on receipt of such information from the individual exporter. I mentioned that this was promised earlier, but the Director, EIC emphatically said that this will be complied with immediate effect. Implementing the above, I would request a) Each member to submit the details of TDS deductions made by their company on such monitoring fees to enable us to follow up with the Director, EIC and his team on giving credits, in the EIA passbooks with immediate effect, as promised. b) I would also request all the members to inform about any disallowances having taken place in their assessment by IT Authorities for not deducting such TDS from the EIA fees. I had written letters previously to all the members advising them to deduct TDS on payment of EIA monitoring fees. 1 got no response from any of the members. This gives a feeling that almost all the members barring a few are having no issue in their assessment with the IT authorities for not deducting TDS from EIA fees.. This may be so, but the fact remains that this matter can be brought up by IT authorities, any time. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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