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TMI Blog2019 (12) TMI 1533X X X X Extracts X X X X X X X X Extracts X X X X ..... ion has been taken at nil and equal adjustment is proposed. In both these transactions, we observe that no prescribed method has been followed by the TPO as envisaged by the provisions of section 92C of the Act. The Ld. DRP has also upheld the order of TPO while allowing some relief on the additions proposed. In our view the TPO is duty bound to propose additions/adjustments in ALP after following any of the methods as prescribed in section 92C of the Act. See M/S. JOHNSON JOHNSON LTD. [ 2017 (3) TMI 1520 - BOMBAY HIGH COURT] and M/S. KODAK INDIA PVT. LTD. [ 2016 (7) TMI 677 - BOMBAY HIGH COURT] In both the decisions, the Hon ble Bombay High Court has held that it is obligatory on the TPO to follow one of the method as mandated by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entry of write off of advances as a separate international transaction and computing the arm's length price of the alleged international transaction. 3. On the facts and in the circumstances of the case and in law, the Hon'ble DRP erred in directing and the learned AO 7 TPO erred in disallowing the write off of the bridge fees in entirety by the Appellant considering prudent accounting principles. 3. On the facts and in the circumstances of the case and in law, the Hon'ble DRP erred in directing and the learned AO 7 TPO erred in disallowing the Service fees in entirety in AY 2011-12 not giving cognisance to the commercial rationale and business realities considered by the assessee for payment of service fees. 4. On the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so took us through para No.6.2.4 of TPO s order wherein the ALP of the international transactions qua certificate fee for purchase of franchise amounting to ₹ 6,65,15,940/- was taken at nil and an adjustment of the same amount was proposed to be made in the aggregate value of international transactions repayment of the assessee that too without following any prescribed method under section 92C of the Act. 5. Similarly, the Ld. A.R. submitted that the Ld. DRP has grossly erred in upholding the order of TPO by ignoring the fact that no specific method as provided in section 92C was followed and giving the direction to the TPO /AO in para No.8.3.3 and 9.3.3. Finally, the Ld. A.R. submitted that the order passed by the TPO without foll ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the material on record. The only dispute raised before us that TPO has not followed any of the prescribed methods as mandated by the provisions of section 92C of the Act. We observe that in respect of advance given to AE which has been written off by the assessee, the TPO has taken the ALP of the international transaction of writing off of the bridge fee amounting to ₹ 3,32,54,170/- as nil and an equal adjustment has been proposed to be made in the aggregate value of international transactions reported by the assessee. Similarly, in respect of service fees for purchase of franchise, the ALP of the international transaction has been taken at nil and equal adjustment is proposed. In both these transactions, we observe that no prescri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rise to any substantial question of law. Thus, not entertained. Similarly, in the case of CIT vs. Kodak India Pvt. Ltd. (supra) the Hon ble Bombay High Court has held as under: 10. We must also record the fact that the ALP was arrived at by the Transfer Pricing Officer (TPO) by not adopting any of the methods prescribed under Section 92G of the Act. The method to determine the ALP adopted was not one of the prescribed methods for computing the ALP. It was not even any method prescribed by the Board. At the relevant time, i.e. for A.Y. 2008-09 Section 92C of the Act did not provide for other method as provided in Section 92C(l)(f) of the Act. The impugned order of the Tribunal holds that the method adopted by the Revenue to determin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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